IT IS five years since the Archbishop of Canterbury announced that he wanted credit unions to out-compete Wonga, shortly after which it was discovered that the Church Commissioners had, however indirectly, been early-stage investors in the company.
They sold out their investment at a loss, but they may have escaped a much bigger one: the most interesting story in the press this week was the woes of Wonga, which has had to appeal for £10 million from its shareholders to keep trading. Yet this is a company that was hoping to float at a value of more than £770 million when the Archbishop first attacked it, and now is valued at about £23 million.
What happened? It certainly wasn’t credit unions. What brought Wonga down was two things, and I think the Church can claim a bit of credit for one of them: in 2014, the Financial Conduct Authority cracked down on the business, imposing limits on the total debt that anyone could owe, and limiting interest rates (now down to a maximum of a modest 1509 per cent).
The company wrote off £220 million in debts and interest for 330,000 people then. The next blow, which may prove to be fatal, came when other predators turned on the wounded legal loan-sharking business. The “claims management” companies responsible for all the junk mail and unsolicited calls that you get about PPI mis-selling have now moved into the market of Wonga customers.
The Guardian’s story on the decline and fall of Wonga states that nearly two-thirds of the claims against it at the financial ombudsman are now coming from claims-management companies. There were more than 2300 in the second half of last year alone.
This is gratifying news, but not entirely so. Every indication that we have is that poverty has worsened since the crackdown on Wonga. Foodbank usage is up. So, where are the desperate getting their money now? I would like to think that there were churches doing something about it, but, even at the time of the Archbishop’s announcement that he wanted to out-compete Wonga, it was obvious that the Church did not have the money, nor did existing credit unions have the reach.
IN FACT, the diocese of Leeds cannot even pay its own pensions (News, 3 August). Quite a lot of newspapers followed Harriet Sherwood’s Guardian story about the financial crisis there. Most took up the north-south angle. Kaya Burgess, in The Times, wrote: “Northern regions of the Church of England have been left to struggle financially while southern dioceses prosper, a bishop has said, calling the divide an ‘institutional sickness’.
“The Diocese of Leeds, the largest, is facing a financial crisis. A deficit of £3 million will force it to lay off staff and close its pension scheme.
“The Bishop of Burnley, the Right Rev Philip North, said on Twitter: ‘A northern diocese [is] in crisis because of a debt of less than 1 per cent of the funds held by some southern dioceses. This ‘crisis’ is no more than a symptom of a much deeper financial and spiritual institutional sickness.’”
Bishop Baines replied: “It is not a crisis. It is reality and we are attending to it — have been for some time. Not everything can be pinned on the South.”
I really like the way that bishops can now snipe at each other on Twitter in the confidence that journalists will pick up and amplify their messages.
THE main Times religious story of the week, though, was one about Muslim marriages and, in particular, the use of young women as bargaining chips for visas to Britain.
“British teenagers are being forced to marry abroad and are raped and impregnated while the Home Office ‘turns a blind eye’ by handing visas to their husbands, The Times has found.
“Officials received dozens of reports last year that women wanted to block visas for men they had been made to marry in countries including Pakistan, India, Bangladesh and the United Arab Emirates. In almost half of their cases the visas were approved, records show.
“Experts believe that there are thousands of victims in Britain as the vast majority are too afraid to come forward. Charities and campaigners say that the findings confirm their long-held suspicion that officials ignore reports from victims.”
Although the last big anti-Muslim story in The Times, about a fostering case in Tower Hamlets (Press, 8 September 2017, 10 November 2017), turned out to be pernicious nonsense, this one looks pretty solid. There was a really chilling interview, secretly recorded, with a Bradford lawyer, who advised a client how to get around the laws against forced marriage. It will be interesting to follow that story when it reaches the Solicitors Regulatory Authority.
THE GUARDIAN, however, had good news for the victims of sharia marriages, who, as things now stand, have no rights under English civil law if the marriage breaks down, since, if it is not registered civilly, it is treated as if it didn’t happen at all.
Harriet Sherwood picked up a court judgment, on which the paper then ran a leader, which showed a way round the dilemma. In this case, the judge decided that the marriage had had enough reality for him to declare it void from the beginning. So Muslim women can be properly divorced under English law, even if they were never properly married. This is a really elegant solution to dealing with the damage done by sharia courts without recognising their jurisdiction.