The changing face of Banking ...

Following the bailout of the Banks in 2008, one of the conditions set by the EU was that both LloydsTSB and RBS (Royal Bank of Scotland) are required to divest part of their Retail and Corporate business, to effectively create two new challenger Banks on the High Street – each Bank having significant market share.

A couple of months ago, we saw the launch of the UK’s 7th largest Bank ‘TSB’, a brand that first appeared 200 years ago.  RBS has also recently announced that Corsair consortium - which is backed by Church Commissioners for England and therefore the church's pension fund - had successfully bought a stake in the Williams & Glyn Bank.

The deal is significant as it will give the Church a role in high street banking, it was backed by the Church Commissioners and it is believed to be in attempt to establish an ethical dimension in the group's vision for the small business-focused Bank. Lord Davies, one of the executives has pledged to put lending to small business at its heart, give more funds to the community, cap its bonuses at 100% of annual salary [a pay policy driven by the Church] and to uphold “the highest ethical standards”.  John Maltby the new CEO has been quoted as saying “Williams & Glyn’s will commit to the highest standards of banking ethics and business conduct while providing increased customer choice in the UK Banking market”.

We will not see Williams and Glyn return to the high street until 2015 but it will be interesting to see what influence the Church and John Maltby have in its creation and how different it will be to the Top 5 high street Banks of today.

Emma Mitchell

Emma is a member of the congregation of St John's and works as a management consultant within Financial Services

Sky News report 27 September 2103

BBC News report 27 September 2013

Fossil Fuels

On 3 July Southwark Diocesan Synod debated a motion on disinvestment from fossil fuels. You can find the paper introducing the motion HERE.

The link also contains the Order Paper with a proposed amendment. The amendment was carried by a small majority. The amended proposal was carried.

THE FORTUNATE GENERATION?

“Baby boomers should take less from society because they are now ‘absorbing’ too much taxpayers’ money” is an extract from a recent speech by Richard Chartres, the Bishop of London. He also described baby boomers, usually defined as those who were born between 1945 and 1955, as being “the fortunate generation”.

When you first read his statement, it makes no sense because how can one group of people be taking more from society just because they were born between two dates in history? Does someone born on the 1^st January1945  take more out of society than a person born on the 31^st December 1944 or the 1^stJanuary 1956? Of course not, and as Bishop Chartres has implied that we have done rather well because of access to free university education, surely we are more likely to be high income earners and less dependent on the state than other generations?

On reading between the lines, I suspect what the Bishop is really saying is that there are too many of us and we are going to be a burden on the state because of the so called “demographic time bomb”. Since the war successive politicians have played a long game of “pass the parcel” with the present lot finding the demographic bomb in their laps with no one else to pass it to.

It seems that the bishop is being is used by politicians as a “Trojan Horse” to soften up the electorate for yet more attacks on the pension rights of the baby boomers and, of course, subsequent generations. They have already increased the age for women to receive their pensions from age 60 to 65 and for men and women then to age 66.The link between annual increases in the pension with the retail price index has been axed as has the usual practice of increasing age-related tax allowances in line with inflation. These attacks have been introduced with minimal opposition, and there is no reason to suppose that they won’t continue with the age being continually increased and the distinct possibility that pensions will be reduced in cash terms or certain groups will not be eligible at all for pensions.

Already Ed Balls has stated that an incoming Labour Government will introduce a cap on state pensions. What does that mean? I don’t know and I suspect neither does Ed Balls. He is testing the water to gauge the level of opposition (if any). It is very alarming that the party that is supposedly  strongly wedded to the rights of ordinary people is even contemplating a cap; this is however  not a party political matter, the whole of the political class can see massive savings in reducing pensions from a section of society that is seen as being passive, a “soft touch”.

This assault by government on the state pension could not have come at a worse time for millions of those approaching retirement as they discover that the pay-outs on their pension pots invested in personal pensions are typically only a third of those of ten to fifteen years ago. The take- ups of annuities are at an all-time low as people hang on  in the hope that rates improve, but if they wait too long and they die in the meantime, all the pot reverts to the insurance company with spouses and children being left penniless. I don’t know if it is just me that finds this situation to be very worrying as it obviously has consequences for families throughout the country, together with wider society.

It is therefore very disappointing that a leading figure of the Church of England seems to be siding with the government rather than the people on this issue.

Steven Clark 

Text of the speech

Church Times Report

Daily Telegraph Report

Daily Mail Report