Archbishop backs new finance tax

2 November 2011 Last updated at 13:19 GMT  Dr Rowan Williams has made his first substantial response to the protest at St Paul's Cathedral The Archbishop of Canterbury has backed calls for a new tax on financial trading - dubbed a "Robin Hood" tax.

Dr Williams told the BBC the St Paul's protests had raised awareness of the "unfinished business" of financial sector reform.

He said the public had the feeling that changes to financial institutions were not coming fast enough.

David Cameron says there is widespread support for the principles of such a tax but it had to be adopted globally.

In an interview with BBC religious affairs correspondent Robert Pigott, Dr Williams said the protests outside St Paul's Cathedral by groups opposed to corporate excess had "triggered awareness" of the unfinished business between government and banks and the need to deliver a more just and rational system.

Dr Williams' remarks suggest he has some degree of sympathy with what he described as the widespread and deep exasperation with the financial establishment articulated by the protesters, our correspondent said.

Writing in the Financial Times, Dr Rowan Williams said the levy would be one way of advancing the "moral agenda" of the protesters outside St Paul's.

'Powerful sense'

In his first substantial response to the protest, Dr Williams cited ideas put forward by the Vatican for creating ethical regulation of financial markets.

He supported controversial proposals for the so-called Tobin tax - dubbed a "Robin Hood tax" by the FT - which would levy a small tax on share, bond and currency transactions with the proceeds reinvested in the "real economy".

Dr Williams said the best outcome from the unhappy controversies at St Paul's would be if such ideas could form the basis for "credible change in the financial world".

The archbishop wrote: "There is still a powerful sense around - fair or not - of a whole society paying for the errors and irresponsibility of bankers; of messages not getting through; of impatience with a return to 'business as usual' - represented by still soaring bonuses and little visible change in banking practices."

Dr Williams referred to a document produced by the Vatican's Pontifical Council for Justice and Peace last week.

Continue reading the main story Tax on global financial transactionsNamed after Nobel Prize-winning economist James Tobin, who proposed the ideaIntended to discourage destabilising market speculation while raising large revenues Pushed by former prime minister Gordon Brown in response to the financial crisis but currently opposed by the coalition governmentRecently proposed by the European Commission, with the suggestion revenue could be used to tackle the financial crisisThe article also suggested separating the retail and trading arms of banks and placing more obligations on banks that were bailed out with public money.

"These ideas - ideas that have been advanced from other quarters, religious and secular, in recent years - do not amount to a simplistic call for the end of capitalism, but they are far more than a general expression of discontent", he said.

"If we want to take seriously the moral agenda of the protesters at St Paul's, these are some of the ways in which we should be taking it forward."

Dr Williams said the protesters' demands needed to be "a bit more specific", and said the Vatican's proposals should be a starting point for debate.

Legal action  Protesters have been camped outside St Paul's Cathedral since 15 October

The City of London Corporation has "paused" its legal action against the camp outside St Paul's, set up by protesters on 15 October.

Stuart Fraser, the corporation's policy chairman, said the decision followed the cathedral's move to suspend its own legal action against the camp.

When asked on BBC Radio 4's Today programme if the corporation had paused its legal action because "you don't want to look like the vicious ones who got the police in", Mr Fraser responded: "It's probably stupid to deny that that's not in our thoughts."

He went on: "What we want to do is to have a discussion with the protesters - can they accommodate our desire to clear the public highway? That's all we're asking."

The church said it had wanted to "engage directly" with the protesters.

The Bishop of London, Dr Richard Chartres, said the situation was now in a "much better place" following "open and frank" conversations on Tuesday morning.

Asked how damaging the episode had been for the Church, he told the Today programme: "Christians are very used to near-death experiences [and] they're also used to resurrections.

"The cathedral has burned down [but] its symbol is the phoenix and I have absolutely no doubt that that will be the story this time as well."

When asked if the protesters could camp as long as they liked, he said the cathedral would look at the situation day by day.

Occupy London Stock Exchange said it was "delighted" the two potential legal cases had been suspended.

Protester Naomi Colvin told the Today programme the demonstrators wanted any decision to leave to be theirs, and it would come only when they had achieved their objectives in the current location.