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Has the C of E got its Reparations Bill all wrong?

Robert Tombs
Written by Robert Tombs

Following an inquiry undertaken by accountants into investments made by the Church of England which appeared to be related to the slave trade, the Church announced the creation of a reparations fund of £100 million with the aim of eventually raising £1 billion. But the research of historians now suggests that the Church has misinterpreted the records of its investments. Here, Robert Tombs explains the background and asks whether the Church has anything to answer for and to pay back.

We are grateful to The Spectator for permission to republish this article

Reparations have a troubled history, and rightly. The word itself, in its familiar sense, seems to have been a euphemism thought up by lawyers after the first world war. President Woodrow Wilson had promised a peace ‘without indemnities’. So no indemnities: ‘reparations’ instead. It sounded less objectionable. It was further agreed that liability should cover only demonstrable damage, not be punishment for the act of war itself – a remarkable and perhaps unprecedented concession by the victors to the vanquished (who had themselves recently imposed heavy indemnities on Russia, and before that on France). Yet reparations – relatively modest in total and largely unpaid – still became probably the most divisive and damaging aspect of the post-war Treaty of Versailles. The many groups advocating various forms of reparations today would be well-advised to show some circumspection.

The case for reparations at the time was politically irresistible and ethically defensible. Germany had not only invaded its neighbours, it had fought the whole war on their territories. Their populations had been subject to forced labour. Industries had been looted, with machinery removed lock, stock and barrel. Housing and infrastructure had been destroyed by four years of devastating combat – and in retreating, German armies had carried out a scorched-earth policy, which included flooding coal mines and destroying crops. Millions were left widowed, orphaned or disabled, needing pensions.

Finally, reparations were partly conceived as a deterrent to future aggression if voters and taxpayers realised they might be liable to pay compensation for their country’s misdeeds. As an Allied statement put it: ‘Somebody must suffer the consequences of the war. Is it to be Germany, or only the peoples she has wronged?’ So the case for reparations seemed strong and coherent to both politicians and peoples as the Great War ended.

The contrast with demands for reparations today is glaring. Then, the damage was visible, recent and quantifiable. The victims were readily identifiable and were in dire and urgent need. There was little doubt, at least in the minds of the Allies, as to who was principally responsible: Germany, its rulers and to some degree its people. Nevertheless, reparations caused bitter controversy, which perhaps even a century lateris not entirely extinct. The Cambridge economist John Maynard Keynes led criticism of what he called ‘imbecile greed’ and ‘hypocrisy’.

This was somewhat unfair, but nevertheless there were objections in principle to reparations that later generations have rightly taken seriously. Reparations caused endless, dangerous resentment, and damaged the prospects of genuine reconciliation. They arguably harmed both those paying them and those receiving them. They caused severe trade distortions and added to financial instability. They imposed burdens on people not responsible for the damage being repaired.

Worst of all, the political outcomes were disastrous.

One might think that such a discouraging and well-known historical example as the Treaty of Versailles would cause those blithely proposing billions or trillions in reparations for long-distant wrongs to exercise some caution, especially as today’s circumstances make the case for reparations vastly less strong than it was in 1920. Precisely what damage today is to be repaired? Who are the victims now? Who alive in the 2020s is responsible for events in the 1720s? How can the monetary cost of remote harms be reasonably calculated? Would resentment be caused by the imposition of reparations? How damaging might that be to present society and to the relationship between payers and receivers? Could resources be better used to relieve urgent 21st-century needs, rather than to pay the distant heirs of long-dead victims?

Those seeking to benefit from enormous sums in reparations may be understandably disinclined to such reflections. But could not a major public institution such as the Church Commission – chaired by the Archbishop of Canterbury and including the Prime Minister, the Lord Chancellor, and the Speakers of the two Houses of Parliament – be relied upon to exercise prudence and judgment? It seems not.

After obtaining research of its archives by a firm of accountants which formed the substance of ‘Church Commissioners’ Research into Historic Links to Transatlantic Chattel Slavery’ (2023), the Commissioners have announced the intention of creating a £100 million ‘impact investment fund’ in reparation for the Church’s having profited from slave trading; and they have further welcomed a report by an oversight group which has proposed increasing this sum to ‘target assets of over £1 billion’.

Their language has oscillated between the unambiguous use of the word ‘reparation’ and the vaguer expression ‘healing, repair, and justice’ – a distinction without real difference, as can be seen in the sum being offered, its supposed derivation (‘a historic pool of capital tainted by its involvement in African chattel enslavement: Queen Anne’s Bounty’) and the extraordinarily unspecific and unmeasurable aims of the project (to ‘generate returns that would replenish and enable funding to be deployed to relevant causes in the African diaspora, ideally in perpetuity’). The disbursement seems to be practically unconditional, and principally aimed at the black middle class (‘Black-led businesses… Black fund managers… brilliant social entrepreneurs, educators, healthcare givers, asset managers and historians’, as the Oversight Group of the Church Commission lists them).

William Hogarth The South Sea Scheme. Speculators Ruined by the collapse of the South Sea Company (1721)

William Hogarth, ‘The South Sea Scheme. Speculators Ruined by the collapse of the South Sea Company’ (1721)

The basis of the reparations policy is this. The administrators of Queen Anne’s Bounty, a royal fund for the support of the clergy, accumulated investments of £200,000 in the South Sea Company between 1720-39. This company for a short period traded slaves to Spanish colonies. Therefore, it is concluded that the Church profited from the slave trade, and hence is in possession of ill-gotten gains it should not have – and which must be given away. The Commissioners have estimated that those ill-gotten investments now amount to £440 million.

It is easy to imagine how those pushing for reparations will attempt to apply the same formula to other great institutions. If the Church of England recognises a moral obligation to pay reparations, who can claim exemption amid the ensuing rush of demands? Indeed, this is part of the Oversight Group’s plan: ‘other institutions once complicit in African chattel enslavement’ will be expected to follow suit. The monarchy, the great museums, the universities, major industries, even ‘farming and fishing’ – all will surely face increased pressure to pay moral and financial tribute for the sins of ancestors.

A trade label of the South Sea Company used for the export from England of serge cloth

A trade label of the South Sea Company, used for the export from England of serge cloth

Except that the Commission’s whole case is highly dubious. According to a recognised expert, Professor Richard Dale, the Commissioners and their accountants have misunderstood basic facts. The South Sea Company was only in part a trading company, which undeniably (though rather unwillingly) provided slaves for a short period to the Spanish empire as part of a deal allowing it to export manufactured goods.

The company’s investors and directors disliked the deal, as they knew that trading in slaves was not likely to be profitable. So it proved: the company made losses on its brief slaving activity. But it had a safer and bigger source of income, as it was also a holding company for government debt in a scheme for privatising the huge liabilities incurred during the decades of war that followed the Glorious Revolution. Over-optimistic investors triggered an unsustainable rise in the share price – the famous South Sea Bubble – but wiser investors remained sceptical.

The managers of Queen Anne’s Bounty, whether through moral scruple or probably just a proper concern for the security of their fund, were not interested in the company’s trading activity, including in slaves. It appears that as soon as the fund managers could, they swapped their shares for government annuities administered by the company. In Professor Dale’s view, as outlined in an article in the Church Times, ‘by confining their investments to annuities, the Bounty managers studiously avoided investing in the slave trade’. As with holders of gilts today, their income came from the British taxpayer. It was not tarnished by trading in human beings. Moreover, annuities in time become extinct, and it seems that by the 1790s they had done so, leaving no ‘historic pool’ of tainted capital for Queen Anne’s Bounty.

Queen Anne reigned 1702 14

Queen Anne (reigned 1702-14)

If Professor Dale and other specialists are right, the Church Commissioners, with loud fanfare, have earmarked an enormous sum in reparations for a sin that was never committed out of profits that were never made. At the very least, this shows astonishing imprudence by the Commissioners and various Church dignitaries. Surely they should have taken proper account of a range of expert opinions and thought carefully before committing themselves publicly to an unjustified, divisive and financially onerous policy.

Who is now capable of making the ecclesiastical authorities see sense and devote their vast wealth to causes approved by the people who still worship faithfully in their crumbling churches and understaffed parishes? Would it be too much to ask that those authorities should also take greater care not to distort the history of the country which has long sustained the Church establishment, which fought to end slavery, and which ample evidence shows to be among the world’s least racist societies?

More broadly, this case again shows very starkly the dangers of great institutions being panicked by activists into absurd and unjustified policies which no one in positions of responsibility dares to oppose. We have seen trustees making unaccountable decisions with seeming disregard for the interests of the institutions entrusted to their care. Who will guard the guardians?

About the author

Robert Tombs

Robert Tombs

Robert Tombs is Emeritus Professor of French History, Cambridge, and a Fellow of St John’s College. He holds the Palmes Académiques for services to French culture. Recent works include The English and Their History (2014), Paris, bivouac des révolutions (2014), and This Sovereign Isle: Britain In and Out of Europe (2021).