Seeking anonymity

In the second of our series on faith in the financial crisis, the Director of the St. Paul's Institu

Each morning at the early service at St Paul’s Cathedral prayers are offered for different groups of City workers in turn. Everyone – office cleaners, financiers, insurance workers, restaurateurs, waiters, street cleaners, builders, and so on – is prayed for. As the credit crunch has bitten harder, so there have been more prayers: those affected are mentioned at the larger services of evensong every night and at the Sunday morning eucharist, attended by hundreds of people. It’s one of the ways the Cathedral can respond to the current situation. Most people don’t know we do it; but we do it, and it’s at the front line of our care.

The atmosphere around the Cathedral in the City, and even more so further east in The Wharf, is strange. There’s a studied air of "business as usual" but the feeling is different. More fear, more uncertainty, less busyness, more reflection. We don’t know who of the many people that come to the Cathedral for quiet prayer are there because of large or small financial worries. We don’t ask people, unless they want to talk, because a Cathedral can offer a great gift to the public: anonymity. It’s a big place and you can mind your own business if you want to. In the mornings, when we open up for Mattins at 7.30, a few people wander in to sit quietly for a moment or two on their way to work. The Cathedral is silent then, and beautiful.

The Cathedral is full of staff, clergy and lay who see themselves as there first and foremost for the people who visit. We are conscious that the City is shaky and that its workers are under horrendous pressure. There is always someone available from our pastoral team to spend time with anyone appearing at our doors in distress. The offices in the vicinity of the Cathedral can ask for passes so that their staff can visit whenever they want to; coming in and out as neighbours, as and when they wish, rather than attend as paying tourists.

The Cathedral is also addressing the broader ethical and social issues arising from the current crisis, seeking to make a serious and challenging contribution to how to emerge from its ravages wiser and better governed. What individual and corporate lessons in business ethics need to be learned? Will financial institutions need to constrain their global ambitions? What should risk strategies look like? What makes for genuine human flourishing? St Paul’s Institute for 21st century ethics is holding a series of debates in October on money: on global institutions and global governance; on the interplay between individual responsibility, rule making and ethics; corporate standard-setting; free markets; and the impact of the credit crunch on the third world. We will bring together practitioners in the financial world, moral philosophers, theologians, social historians and economists, in the Cathedral itself where we can host audiences of up to 2,500 people, for free and un-ticketed events. We can bring together people who wouldn’t otherwise meet - from business, the professions and other walks of life.

We are encouraged by senior figures in the City who advise us that we are playing an important part, as a large religious institution in the heart of the City, in evoking wisdom in the midst of a confusing and frightening time.

Claire Foster is Lay Canon at St Paul’s Cathedral in the City of London and Director of the St Paul’s Institute

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George Osborne's mistakes are coming back to haunt him

George Osborne's next budget may be a zombie one, warns Chris Leslie.

Spending Reviews are supposed to set a strategic, stable course for at least a three year period. But just three months since the Chancellor claimed he no longer needed to cut as far or as fast this Parliament, his over-optimistic reliance on bullish forecasts looks misplaced.

There is a real risk that the Budget on March 16 will be a ‘zombie’ Budget, with the spectre of cuts everyone thought had been avoided rearing their ugly head again, unwelcome for both the public and for the Chancellor’s own ambitions.

In November George Osborne relied heavily on a surprise £27billion windfall from statistical reclassifications and forecasting optimism to bury expected police cuts and politically disastrous cuts to tax credits. We were assured these issues had been laid to rest.

But the Chancellor’s swagger may have been premature. Those higher income tax receipts he was banking on? It turns out wage growth may not be so buoyant, according to last week’s Bank of England Inflation Report. The Institute for Fiscal Studies suggest the outlook for earnings growth will be revised down taking £5billion from revenues.

Improved capital gains tax receipts? Falling equity markets and sluggish housing sales may depress CGT and stamp duties. And the oil price shock could hit revenues from North Sea production.

Back in November, the OBR revised up revenues by an astonishing £50billion+ over this Parliament. This now looks a little over-optimistic.

But never let it be said that George Osborne misses an opportunity to scramble out of political danger. He immediately cashed in those higher projected receipts, but in doing so he’s landed himself with very little wriggle room for the forthcoming Budget.

Borrowing is just not falling as fast as forecast. The £78billion deficit should have been cut by £20billion by now but it’s down by just £11billion. So what? Well this is a Chancellor who has given a cast iron guarantee to deliver a surplus by 2019-20. So he cannot afford to turn a blind eye.

All this points towards a Chancellor forced to revisit cuts he thought he wouldn’t need to make. A zombie Budget where unpopular reductions to public services are still very much alive, even though they were supposed to be history. More aggressive cuts, stealthy tax rises, pension changes designed to benefit the Treasury more than the public – all of these are on the cards. 

Is this the Chancellor’s misfortune or was he chancing his luck? As the IFS pointed out at the time, there was only really a 50/50 chance these revenue windfalls were built on solid ground. With growth and productivity still lagging, gloomier market expectations, exports sluggish and both construction and manufacturing barely contributing to additional expansion, it looks as though the Chancellor was just too optimistic, or perhaps too desperate for a short-term political solution. It wouldn’t be the first time that George Osborne has prioritised his own political interests.

There’s no short cut here. Productivity-enhancing public services and infrastructure could and should have been front and centre in that Spending Review. Rebalancing the economy should also have been a feature of new policy in that Autumn Statement, but instead the Chancellor banked on forecast revisions and growth too reliant on the service sector alone. Infrastructure decisions are delayed for short-term politicking. Uncertainty about our EU membership holds back business investment. And while we ought to have a consensus about eradicating the deficit, the excessive rigidity of the Chancellor’s fiscal charter bears down on much-needed capital investment.

So for those who thought that extreme cuts to services, a harsh approach to in-work benefits or punitive tax rises might be a thing of the past, beware the Chancellor whose hubris may force him to revive them after all. 

Chris Leslie is chair of Labour's backbench Treasury committee.