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Community

Weirdness

13 May 2023

3 min read

When nuns held up a bank

A community fearing being left behind, takes novel action to help change its economic and social fortune. Ryan Gilfeather tells the tale.

Ryan Gilfeather

Ryan Gilfeather explores social issues through the lens of philosophy, theology, and history. He is a Research Associate at the Joseph Centre for Dignified Work.

A pile of coins in focus at the bottom of an out of focus glass tube.

Small value coins were at the heart of the nuns' actions.

Photo by Nick Fewings on Unsplash.

Days before Christmas 2001 a mob of nuns and priests held up a bank in Oxford Street. They were not stealing money but rather paying it in. The Nuns of St Antony’s Forest Gate, a 2000-person strong Catholic parish saved their collection money until they had a staggeringly vast quantity to deposit. On the day, they took the money in a van to an HSBC branch in Oxford Street, wheeled it in on trolleys, where they proceeded to deposit every single coin.

At the same time priests in their clerical collars, and worshippers from a range of congregations in East London queued up at the other desk to slowly and repeatedly enquire about opening savings accounts. All the while, other members of these institutions stood outside holding banners accusing HSBC of exploiting low paid workers, saying “Give HSBC a Living Wage for Christmas.” The entire branch was brought to a standstill. Anxious Christmas shoppers stood helpless and astonished as this spectacle frustrated their attempts to withdraw money.

They heard that wages were so bad that workers needed to take on multiple jobs, forcing them to choose between feeding their kids and seeing them.

These nuns, priests and other Christians planned this action to secure a liveable wage for all who work at HSBC, but they also had broader ambitions. The East London Communities Organisation (TELCO), a broad-based coalition of citizens from churches, mosques, and other faith and community groups began to organise for a pay rate which was enough to live on, the amount which is now known as the Real Living Wage (currently £11.95 in London; £10.90 everywhere else). Each of these citizens had been listening to the people in their institutions. They heard that wages were so bad that workers needed to take on multiple jobs, forcing them to choose between feeding their kids and seeing them, and preventing them from praying and worshipping. Motivated by the belief that all human beings are of equal value and dignity in the eyes of God, these Christian communities, alongside the other groups in TELCO began campaigning for a fair and just rate of pay.

The new neighbour

As these discussions were ongoing they could see the new HSBC tower slowly ascending above their East London skyline. Considerable amounts of government money had been spent on the infrastructure of Docklands, which would serve this tower. TELCO citizens discerned that if it was going to benefit those who lived in east London, there would need to be a living wage for everyone who would work in that building. Therefore, they decided to ask the bank to make contracts for cleaning and security at the new tower on the condition that workers be paid enough to live on, in East London (£6.30 at the time). A number of religious and civic leaders had written to the HSBC chairman, Sir John Bond, to request a meeting to discuss these poverty wages. However, they had heard nothing back.

At this point, the nuns at St Antony’s came up with their plan. Visitors and members of the 2000 strong congregation would leave coins in the collection when they light candles in church, and the nuns were accustomed to depositing them every Tuesday. However, they decided to keep hold of them for several months until they managed to fill that small van. Eventually, on 19 December they set out in it to Oxford Street, with priests and parishioners in tow, and brought this branch to its knees.

The action worked. Within an hour Sir John had agreed to meet with TELCO members at St Philip's Church, Plaistow, to discuss their demands that cleaning and security contracts pay a living wage. Negotiations continued until 2004, when HSBC agreed to the campaigner’s demands, ensuring that every contractor pays a living wage, sick pay, pension and free access to a trade union. This victory built great momentum for the movement for a Real Living Wage, which is now voluntarily paid by over 12,000 UK employers. Therefore, this life-giving campaign for economic justice finds its origins, in part, with a group of nuns saving up their small change, because their faith led them to believe in the inextinguishable dignity and value of all human lives.

Explainer

Comment

Economics

29 October 2024

6 min read

How to tax ethically to avoid a two-tier society

From income tax to property and inheritance taxes, which is fairer?

Laurence Fletcher

Laurence Fletcher is a journalist at the Financial Times.

Sarah Agnew on Unsplash.

Few doubt that Chancellor Rachel Reeves will be putting up taxes when she presents her first Budget on October 30th.

The political narrative of recent months has very much been of an alleged fiscal “black hole” of £22bn - or is it £40bn? - that somehow needs to be filled.

While the size of the shortfall and the identity of those responsible are both hotly disputed, and despite a lack of detail from the Treasury about what it actually consists of, the questions now being asked are not whether taxes will rise but which ones and by how much.

Months of speculation have focused on employer National Insurance, capital gains tax and freezing income tax thresholds as areas that Reeves could look to for the additional revenue.

But beyond the immediate issue of raising enough revenue to make good any shortfall, lies a deeper, trickier question about the way in which taxes should be levied for the good of society. If a government is to force people and companies to hand over their money, then what is the most ethical way to do this? Who should pay and who shouldn’t? How can tax be used to reduce inequality and build a better society?

Answering such questions is, of course, far from straightforward, because there are plenty of other factors in play.

For instance, some taxes are surely levied because they are simpler to collect. Take income tax - an unpopular measure introduced in 1799, then abolished before being reintroduced as a supposed temporary measure. It could certainly be argued that taxing people’s income - their attempt to get on in life and improve their lot in life - is less “fair” than taxing wealth that has been accumulated by someone’s ancestors years ago. Working hard and earning income is often surely a way of breaking down class divisions. But income tax - contributing 28 per cent of UK government tax take in 2023-24, according to The Institute for Fiscal Studies - has the advantage that it is relatively difficult for the average worker at a UK company to avoid it. Ease of levying it is surely a driver.

Equally, some taxes that might seem “fairer” have deliberately not been levied because of the difficulty in collecting them, and/or because to try to do so could be counterproductive.

A wealth tax, for instance, would be “economically damaging”, according to one of the UK’s highest profile tax experts Dan Neidle.

Or take the politically contentious issue of non-doms, a colonial era tax break allowing rich foreigners to avoid UK tax on overseas income. It would be fairer, the argument goes, to tax them on the whole of their income. If they are going to be resident in the UK, then surely they should be taxed like a UK resident whose home is here?

Former Chancellor Jeremy Hunt abolished this regime earlier this year but left a number of concessions that the incoming Labour government pledged to abolish. But non-doms are tax-sensitive and highly mobile, and a number of jurisdictions compete to attract them. Many are entrepreneurs and wealth creators that many countries need. Reports have suggested a clampdown could raise no money or even cost money and could drive people away.

“Housing is being treated as a commodity. The problem is, it’s not; it’s not just an asset. It has utility value and a communal and quasi-spiritual value, enabling people to feel rooted.”

Paul Williams

So, what can be done to use tax in an ethical way? Paul Williams, research professor of marketplace theology and leadership at Regent College, Vancouver and chief executive of the Bible Society, takes a Biblical perspective that he believes offers some solutions.

He takes as his starting point a story from the gospel of Matthew, where Jesus is asked whether people should pay taxes to Caesar. The question is a trap - either Jesus gives his backing to taxation that is highly unpopular with the Jewish people, or he rejects the tax in an act of rebellion against the Romans.

Jesus replies that they should “pay to the Emperor what belongs to the Emperor, and pay to God what belongs to God.” We are to pay our taxes to those in authority, but we are also to honour God.

While Williams believes that too much emphasis is placed on the Budget and political parties’ promises to be able to fix everything, and that a more radical rethink of our economy is required, he also sees room for positive tweaks to the current system.

One key area is the property market, the manifestation of so much inequality in society, with some people owning multiple houses while others cannot afford to buy one.

Williams argues that the ready availability of debt finance has allowed those who already hold assets to easily acquire properties, turning real estate into an investable asset class to the detriment of many of the poorer in society.

“The reason there’s so many homeless people and empty houses is due to debt finance. It makes it easy for a relatively small proportion of the population to acquire a large percentage of the assets.

“The system has allowed a structure in which a small advantage in the beginning can lead to big, big differences over time.”

Williams highlights parts of Devon and Cornwall that have been, he says, “completely ruined” by wealthy people from elsewhere buying second homes, leaving property “out of reach of anyone who lives and works there”.

Nevertheless, he believes taxation can be used in this area to help level the playing field.

He proposes a “pretty punitive” marginal rate of tax on ownership of more than one home. (Stamp duty only partly does the job and is a blunt instrument also affecting people moving homes, thereby makes mobility expensive).

“You want to disincentivise the way the housing market is used for speculation,” he said.

“Housing is being treated as a commodity. The problem is, it’s not; it’s not just an asset. It has utility value and a communal and quasi-spiritual value, enabling people to feel rooted.”

Buy-to-lets, meanwhile, are better than having empty second or third homes, but “wouldn’t it be better if occupiers could buy that house?” he adds.

Meanwhile, research by the Financial Times recently found a huge wealth gap between the average millennial and the top 10 per cent of millennials, who are benefiting from family wealth to accumulate substantial housing assets.

So, would increasing the rate of inheritance tax - one of the most hated of taxes - and/or lowering the threshold also help reduce some of this inequality? After all, how is it fair that one child in the UK is born to inherit large property wealth while another is born to inherit little or nothing? Or, even worse, that second child will only ever be able to afford to be the tenant of the first, paying them rent for the rest of their lives?

Williams is not a fan of inheritance tax per se, arguing that it is “not part of the package” in a Biblical image of a flourishing economy.

But he adds an important caveat: “the playing field is not level.

“There might be circumstances to impose a one-off tax on the very wealthy… if you want a transition to a more equitable society.”

Such steps are not easy to take. It is, he admits, probably “career suicide” for a politician to adopt such views. But if we are to take steps towards a fairer way of life, and avoid a two-tier society in decades to come, then maybe the conversation needs to shift this way. Perhaps the Budget could be the time to start.