Memo to the PM: Time for a bold biblical vision for the UK economy
In this long read, Tim puts forward a clear, biblically inspired framework for redesigning the UK’s economy to tackle our deepest challenges. We need for a new and hopeful vision for this country.
Part 1: Telling the truth about the UK
As Boris Johnson whiled away his final weeks in No. 10 Downing Street, we heard daily from the two contenders to replace him as Prime Minister – Liz Truss and Rishi Sunak. Our news feed was full of promises for the future – cuts in income tax and VAT (but also securing fiscal stability, of course), reducing the size of the State (whilst also tackling huge NHS backlogs), delivering on the promise of Brexit (and protecting the Union) and so on.
There was an air of unreality about much of the discussion. I am struck by two things in particular.
Firstly, both candidates seemed to be indulging in a fair amount of backwards looking nostalgia for all things Thatcherite, even though it is 30 years since Margaret Thatcher was Prime Minister. Putting aside the awkwardness of whether a lady strongly wedded to ‘sound money’ would really have approved of half of the current promises being made, such nostalgia seems to betray a real lack of confidence in the future. Where is the confident vision of a better future? Where is the hopeful narrative for a brighter future?
The second thing that struck me forcefully as I scoured the daily news is just how small the vision for this country has become. The promises being made by the aspiring Prime Ministers looked suspiciously like tinkering at the edges. A few per cent here, a few cuts there. Where are the serious policies to tackle the huge issues facing the UK today?
What about climate change and living with a more volatile climate? What about our yawning regional divides – unchanged for generations? Or growing inequality and child poverty? What about the failure of successive governments (of all stripes) to address low productivity and low investment in industry and R&D?
What about generations of talents being wasted by an educational system that still treats vocational qualifications as an afterthought? What about our failing social care system for the elderly and the vulnerable?
Many of these issues have bedevilled our country for my entire adult life; sometimes I fear they will outlast me too. The UK remains the fifth wealthiest country in the world[1] but we seem quite incapable of addressing deep-seated issues. It can’t be a lack of knowledge – we have measured and analysed these problems to death. It isn’t a lack of systems or technical know-how either, as our nation abounds in these. So, why don’t things seem to change? What is the truth about our current situation?
What we seem to lack is vision and the will to change. There is no clear sense of direction and little confidence or political momentum to get there. We seem to be stuck.
Part 2: Telling the truth about markets
It is possible to construct a clear, compelling and attractive vision for the UK by drawing on Biblical principles. God’s blueprint for the people of Israel to thrive as a nation was designed to deliver strong extended families, healthy communities and a land that breathed easily.
The same ideas still work today, because the principles are timeless; God’s intentions for us have not changed. At the heart of God’s blueprint for us are the two commandments that Jesus identified as the foundations for life – to love God and to love our neighbour as ourselves. A national life built on this – with frameworks, programmes, policies and actions all reflecting this, will lead to flourishing and healthy relationships.
I want to offer a clear biblical vision for our economy which addresses core national challenges. In particular, there is one deep-seated challenge which needs to be faced. Over the last 40 years the ‘market’ has encroached upon almost every area of life.
To be clear, markets are wonderful things. Yet, whilst the market brings many benefits to us in the form of interesting work, wealth, technology and new opportunities, it has also been allowed to over-reach, encroaching upon matters that should never really be decided in the marketplace. When we witness working poverty, man-made climate change and companies that extract value, not create it, we see a marketplace in urgent need of reform. Markets are meant to work for people, not the other way round.
A core biblical insight is that the three main ‘factors of production’ (the building blocks of every economy) – labour, land and capital – were never meant to be traded in free markets. They are too important to be left to the arbitrary processes of the marketplace; they are more than just tradeable commodities. Our failure to put clearer boundaries on how we manage our land, employment and finance has led to many of the social and economic issues we struggle with today.
So, here is a new formulation of ancient truths. For the new Prime Minister, here is an agenda which sets out a clear, biblically inspired vision for how the UK could be a healthier, happier and more successful place. I have used the three factors of production as a simple framework to organise six principles.
Part 3: A compelling and hopeful biblical vision for a UK economy that works for all
A successful economic framework for the UK will deliver more than financial wealth measured as GDP; it needs to deliver these three national outcomes as a priority:
Family - Strong, healthy and well-connected extended families
Community - Integrated and prospering communities rooted in places with their own local character and offering a range of dignified jobs and opportunities
Planet - A bio-diverse environment that is sustainably managed and provides renewable energy
How can we do this? We need to re-engineer some important bits of our economy. These outcomes would be delivered through six core principles, as described here under our three headings.
Labour
Principle 1 – Dignified work
Principle 2 – Fair pay at all levels
Land
Principle 3 - Rooted and prospering communities
Principle 4 – A bio-diverse and sustainable environment
Capital
Principle 5 – Preventing the concentration of wealth
Principle 6 – Fair tax
Labour
Principle 1 – Dignified work
All work matters, from farming to advanced manufacturing, from social care of the elderly to cleaning, from business services to academic research. Jobs of the ‘head, hand and heart’ all matter[2] and not just for economic reasons; they possess inherent purpose and dignity not entirely measurable by wages or prices.
This has implications for education – we need to invest in all kinds of skills, vocational training as well as higher education. We need a step change in vocational education, further education and apprenticeships; we write off the futures of too many young people in this country.
It has implications for where we draw the boundaries of work. The sabbath principle still holds today – we all benefit from shared days off. We all need to be able to switch off, we cannot be ‘always on’. Employers, and the jobs they design, need to respect working boundaries and roles need to pay enough to make that financially possible. If employers cannot be persuaded to do this, then employment rights should be beefed up – we currently have some of the lowest employment standards in the western world and it’s not making us happy.
It also means that we cannot leave failing sectors to the market where they leave people struggling with poor working conditions and unable to deliver properly – sometimes stronger regulation or wholesale reform is required.
Our social care system is a sad and classic example. Good care for the elderly (and other vulnerable adults) is widely held to be a marker of a civilised society and yet, having been ‘opened up to the market’ this sector is also widely acknowledged to be failing[3], with patchy service levels, gaps in provision and low pay and poor working conditions for many carers. Dignity of work (and dignity of care) will only be secured with wholesale reform, and with stronger and better regulation of providers – or a new approach entirely. (With a more regional approach to the economy, as described below, it is also possible that families could be better positioned to provide more care for their relatives themselves.)
Principle 2 – Fair pay at all levels
The Bible speaks clearly about the importance of fair, honest and timely payment of wages. It also reserves some of its strongest language to condemn those who abuse power to accumulate excess wealth for themselves. The biblical vision is of workers earning enough to support their families and live meaningful lives, with no-one left destitute and the wealthy called on to consider others and also share what they have. The ancient practice of ‘gleaning’ by landowners is a fascinating insight into a mindset which did not seek to maximise income but accepted wider social responsibilities. Workers were actively included in the harvest to ensure that no-one was left behind.
Today in the UK we are now in the weird position of not only being one of the wealthiest countries in the world but also having accelerating working poverty; more than half of those who live in poverty also work for a living. How has it come to this? Low wages, the gig economy and, in some businesses, unbridled greed, have conspired to ensure that work doesn’t pay for a lot of people, even whilst shareholders in the same companies take home large dividends.
There is a clear need for a fairer settlement – a real living wage for all workers (yes, on statute, if necessary), ending zero-hour contracts for the low paid (maybe those earning less than £30k pa) and more moderate remuneration for those at the top (why does any CEO need to earn over 20 times more than this colleagues?). This is not about charity or envy or redistribution, it’s about justice and ensuring a fair share for all those who contribute to making each pie[4]. Do CEOs really ‘work harder’ than the cleaner who rises at 3am to empty the CEO’s bins and who also works just as many hours? Does he really deserve a salary 100 times larger? No, I don’t think he does, and, interestingly, few other people in the UK think he does either[5].
Can this be done? Yes. Some 20 years ago the Living Wage Movement didn’t exist, and yet today it is a national political force for good. So, I don’t think this is pie in the sky, I think it is a viable programme.
Land
Principle 3 - Rooted and prospering communities
The Bible has a very affirming view of ‘places’; they are all different, they have a history and meaning, they are where community happens. We live in an age where market forces have been allowed to operate in many sectors with little regard to impact or social implications. The closure of a major employer can devastate a town for generations. Our High Streets are hollowed out to become bland ‘nowhere-villes’. Residential properties are bought as investments for distant portfolios, not by locals who just want to live near their families. Local authorities and communities struggle to protect local heritage and character, or to provide services that make sense locally.
We need to rediscover the value of ‘local’ and what ‘rooted’ means. Stronger local government, together with active community groups and civic agencies, and more local and regional business investment (and re-investment of profits) could give every town and city a stronger ability to shape their futures. This would help to retain local character and difference but also to help to create local jobs and opportunities. In the longer term it could also reduce the need for younger generations to leave town, increasing the chances of building extended family networks within a region.
This would mean a marked shift to current policies and practices. What might it look like in practice?
Decentralisation of powers and funding from central government to local government (locally accountable) to give them ‘teeth’. You can’t build civic pride with one hand tied behind your back.
Incentives and mechanisms to boost investment in local and regional economies and create good jobs. Where are our regional banks and development agencies?
Local and regional eco-systems of further and higher education to retain younger generations
Stronger regulation of housing markets to prioritise purchase by owner occupiers, not investors, and preventing overseas purchasing of residential property
A new wave of house-building with a regional character, affordable for local people
Principle 4 – A bio-diverse and sustainable environment
Our stewardship of the earth should be responsible and sustainable, not exploitative. So, our economy needs to make a historic shift away from reliance on fossil fuels. What was once considered impossible is now within grasp as we increasingly rely on renewable energy, but it also needs to go further and include a move away from short-life/disposable culture. There is much still to do to build these concerns into how we do business in the UK.
Agriculture also needs to move towards regenerative farming practices, investing in the quality of soil and bio-diversity as well as managing the transition away from carbon reliance. This could also lead to healthier diets and more local sourcing of food. Brexit makes the complete renewal of our farming sector possible, if there is the vision and will to make it happen.
Capital
Principle 5 – Preventing the concentration of wealth
An underlying problem in marketplaces is that capital assets (including money and land) usually end up being very unevenly distributed between people. Some people accumulate a lot of capital whilst others are left with little or nothing, creating very unbalanced power relationships. Whilst equality of wealth is impossible, the issue here is that human nature being what it is, significant inequality of wealth can often lead to significant abuses of power and exploitation.
The Bible does not accept the abuse of power as a natural, inevitable and acceptable consequence of how society operates. It recognises the abuse of power as a problem and sets out practical ways to address it and ensure that capital is owned and used in a way which is fair. The Old Testament famously bans the use of interest on loans. Such an approach may not be readily achievable today, but the underlying biblical principle is the need to avoid the excessive accumulation of money and power in a few hands and the very negative consequences for relationships that can flow from this.
This is a complex area, but we must not shy away from engaging with it, as it is core to achieving a more biblical approach to our economy and our national life. There are three key points:
Preventing monopolies - Capital should not be allowed to accumulate to the extent that it leads to an excessive concentration of power in the hands of relatively few people, corporations or even governments. The financial flows of money in our economy are underregulated. The UK economy is often characterised as a ‘rentier economy’ now, where those with wealth are disproportionately able to generate more wealth – a system which works well for the lucky few and which is badly broken for the majority. Some businesses are now too big; they have too much power and we must not be afraid to take on monopolies, even if they are global and complex. This is an important area for further thought and imaginative biblically-inspired policy making.
Risk and reward should go together – Business partners and investors should not be able to outsource or offload their risks and impose them on others as this is fundamentally unfair. This means that in business, equity (i.e. investing in shares) is often a fairer route for joint endeavours than debt (i.e. loans with interest payable); risks and rewards should always be bound together.
Preventing excessive debt - Where debts occur, they should not be allowed to accumulate to a level, or persist for a length of time, where people are effectively enslaved by them leading to material and relational harm. In the Old Testament, lending money to the poor at high rates of interest is prohibited and people can only be bought out of their land temporarily, not permanently. Because of this, debts cannot build up endlessly and effectively enslave people who have no place of their own – their dignity and economic independence is retained.
Principle 6 – Fair tax
Our taxation system is complex, has many loopholes and is frequently unfair in who it catches and who it allows to escape. There seem to be different rules for different people.
We need a whole new mindset on tax. It is a way for societies to collectively fund infrastructure and public services for the common good. It is a tool to shape a fairer, greener, happier future. It is, on the whole, a good thing, although there also clearly need to be limits in how it is used.
Aggressive tax avoidance by wealthy individuals or large companies, together with the use of international tax havens, seriously distorts the way that markets work, results in unfair competition and can have significant negative social consequences. It is a big deal. Some estimates suggest that $240 billion of corporate taxes alone are lost each year around the world through unethical tax practices[6]. There is no place in Christian business behaviour for such tax avoidance.
More ambitiously, we need a new framework for taxation in the UK which incentivises the kinds of behaviour we want to see – such as creating jobs – and taxes ‘bad’ things like carbon usage. In a time of great inequality of wealth (not all of acquired through hard work) there is a case for more progressive taxation. There is much scope for a distinctive and radical Christian contribution in the important, if unglamorous, world of tax. The devil lives in the detail.
Part 4: Conclusion: The bit where you come in
The vision of the Bible for our businesses, our economy and our national life is huge. It is big and beautiful. It is radical at times, but life-giving, and has never been more necessary.
Although this a Memo to the new Prime Minister, and there is a full agenda to work on, the initiative also rests with us. We can do a lot of this now. We don’t need to wait.
Business employers can choose how they run their businesses
Individual consumers can choose what they buy and from whom
Churches can choose what they teach their members
Think Tanks can choose which ideas they research and promote
Individuals can choose who they vote for, who they write to, what they say
We have immense agency and opportunity to make a start on this vision and push for change, even today.
But we surely need to work together as well, as this is a huge agenda and the work of a generation. We need to build a national movement to get this done.
We do so in humility, knowing that economic frameworks alone, no matter how good, will not save us. The human condition, even in the 21st Century, still requires the power and hope of the resurrection to address our deepest needs. But with this hope and power, we must answer the call to ‘seek the peace and prosperity’ of wherever we live. And this is one important way to do it.
Are you in?
This blog was written by Tim Thorlby, Director of Beautiful Enterprise. It was previously published in August 2022 and draws on the published work of the Jubilee Centre and other sources. If you’d like to be alerted to future blogs, you can subscribe for free.
[1] By GDP, World Bank data 2022
[2] A case eloquently made by David Goodhart in his book: Head, Hand, Heart: The struggle for dignity and status in the 21st Century, (2020) Penguin
[3] Many reports have been written on this – see for example: Curry N and Oung C (2021) Fractured and forgotten? The social care provider market in England Research report, Nuffield Trust
[4] We will be outlining a fuller theological case for this agenda in a forthcoming Insight Paper in September 2022 by Dr Matt Williams: A biblical response to working poverty: Insight Paper 1
[5] Some 43 CEOs of FTSE 350 companies earn over 100 times more than their average employee salary. A national opinion poll in May 2022 showed that the clear majority of Britons (63%) thought that a ratio of 10-20 times was more than enough. British fair play in action?
[6] For analysis on this, see the Fair Tax Foundation’s work at www.fairtaxmark.net