The church in the crunch

Following huge losses during the financial crisis, the Church of England should return to the Christ

No-one is immune from the global economic crunch. That includes the Church of England, which has £5 billion tied up in assets, pensions and buildings. When the archbishops of Canterbury and York started to sermonise on short-term greed and the failures of market, they were embarrassed to discover that the Church had been playing the system in pretty much the same way as everyone else.

Initially, things looked good. Due to its share holdings, England’s Established Church gained hugely from rising oil, gold and copper prices, driven at least in part by speculators. In 2006-7 the Church Commissioners, accountable to parliament, set up a currency-hedging programme, in effect short-selling sterling to guard against rises in other currencies. The C of E invested £13 million in Man Group, the largest listed hedge fund manager. It also has a stock lending programme through JP Morgan Chase and has traded debts, in spite of the Archbishop of Canterbury's criticism of doing so exclusively for profit. The Church sold a £135 million mortgage portfolio last year.

Then things went pear-shaped. A week ago the Man Group was down 30 per cent in early trading after its profits slumped, potentially wiping £4 million off the value of the Church's holdings. The Commissioners have announced an average return on investments of almost 10 per cent a year over the last ten years. But most of these are in property and equities, which have taken a hammering as markets have fallen; so future prospects are not rosy. Exposure in banking (HSBC, TSB, RBS, and HSBOS, which has fallen a staggering 90 per cent) and mining (in defiance of ethical advice) is also costing the C of E dear.

It doesn’t have to be this way. The founder of Christianity once pointed out that “where your treasure is, there is your heart also”. Now is the right time for the Church of England to completely re-examine its asset and investment policies and to put its money where its message is. Given the performance of more ethical funds, that would also be a prudent move.

Many church groups are involved in alternative economic practices – co-ops, credit unions, ethical investment, fairer trade, local exchange schemes, micro credit, small loans for development, initiatives for monetary reform and more. Christianity, Judaism and Islam all have a history of critiquing usury, unjust profit from interest, and Jews and Muslims have set up non-interest based lending institutions.

Globally, churches have an opportunity to use their assets in new and creative ways, for economic change driven by human need rather than by greed. What is needed is the will. The earliest Christian communities were founded on principles of seeking to use material wealth for the common good, striving for equality and giving priority to the poorest. Today’s churches struggle to be so Christian, it seems. But as neo-liberal ideology quakes before stark reality, the wages of economic spin are proving deadly rather than ‘realistic’.

Simon Barrow is co-director of the religion and society think tank Ekklesia. He is author of ‘An economy worth believing in’.

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Who will win the Copeland by-election?

Labour face a tricky task in holding onto the seat. 

What’s the Copeland by-election about? That’s the question that will decide who wins it.

The Conservatives want it to be about the nuclear industry, which is the seat’s biggest employer, and Jeremy Corbyn’s long history of opposition to nuclear power.

Labour want it to be about the difficulties of the NHS in Cumbria in general and the future of West Cumberland Hospital in particular.

Who’s winning? Neither party is confident of victory but both sides think it will be close. That Theresa May has visited is a sign of the confidence in Conservative headquarters that, win or lose, Labour will not increase its majority from the six-point lead it held over the Conservatives in May 2015. (It’s always more instructive to talk about vote share rather than raw numbers, in by-elections in particular.)

But her visit may have been counterproductive. Yes, she is the most popular politician in Britain according to all the polls, but in visiting she has added fuel to the fire of Labour’s message that the Conservatives are keeping an anxious eye on the outcome.

Labour strategists feared that “the oxygen” would come out of the campaign if May used her visit to offer a guarantee about West Cumberland Hospital. Instead, she refused to answer, merely hyping up the issue further.

The party is nervous that opposition to Corbyn is going to supress turnout among their voters, but on the Conservative side, there is considerable irritation that May’s visit has made their task harder, too.

Voters know the difference between a by-election and a general election and my hunch is that people will get they can have a free hit on the health question without risking the future of the nuclear factory. That Corbyn has U-Turned on nuclear power only helps.

I said last week that if I knew what the local paper would look like between now and then I would be able to call the outcome. Today the West Cumbria News & Star leads with Downing Street’s refusal to answer questions about West Cumberland Hospital. All the signs favour Labour. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.