7 February 2025
On 7 February 2025, The Bishop of Chelmsford, the Rt Rev'd Dr Guli Francis-Dehqni spoke in two House of Lords debates.
In the second reading of the Mortgage Prisoners Inquiry Bill, Bishop Guli spoke about those trapped in expensive, high interest mortgage deals they cannot change and in the second reading of the Education (Assemblies) Bill she spoke about the importance of collective worship in schools.
Second Reading of the Mortgage Prisoners Inquiry Bill
My Lords, I want to begin with a confession which is that I didn’t know much about the scandal of mortgage prisoners until a few weeks ago and it surprised me how long this has been left unresolved. I felt compelled to speak to the plight of mortgage prisoners because when a group of people are marginalised and suffer due to institutional failures, it’s important to ensure they are not forgotten, and the injustice is put right. I’d like to thank Lord Sharkey for bringing this legislation and am grateful to everyone who’s contributing today. We may be a small group debating this matter, my Lords, but it is no less significant because of that.
Mortgage prisoners are trapped in a set of circumstances that afflicts their lives. Excessive interest payments on their mortgage, financial stress to their families, powerlessness to change their circumstances, the lack of choice compared to most borrowers – all in the context of the cost of living crisis – leave many struggling to afford their homes.
And this is a crisis that’s not of their own making. It’s reasonable to believe that home ownership would lead to further stability, and yet many mortgage prisoners face a perilous fate; hopes shattered and lives turned upside down.
There is no legal definition of what a mortgage prisoner is. The FCA defines them as closed booked borrowers, unable to change to a new mortgage deal, despite being in a position where they would benefit from switching, if they met lenders’ risk appetite. This definition captures around 47,000 mortgage prisoners but there are thousands more who are excluded either because they’re in arrears, are near to the end of their mortgage term, or are already paying close to market rates. If we take the broader definition, there are over 200,000 mortgage prisoners still left in the UK, although the precise number can’t be estimated without the Treasury releasing the data.
The mortgage prisoner problem emerged from the financial crisis and for some their misery has never ended, starting with the collapse and eventual bailout of Northern Rock and Bradford & Bingley. It wasn’t meant to be this way. Northern Rock was a Triple A lender, regarded as one of the largest and safest banks with a fast-growing national presence that had roots firmly tied in the northeast.
Once Northern Rock collapsed, the Government took over and later re-sold those mortgages back into the private sector, but without written assurances that customers would be able to access the re-mortgage market. A small proportion were bought by active mortgage lenders, but most were sold to closed book lenders like Heliodor Mortgages, an entity none of us could borrow from but that exists solely to serve former Northern Rock customers. To give a sense of how dissatisfied these customers are, every one of the 134 Trustpilot reviews of Heliodor is 1-star, the lowest possible rating.
The situation has been exacerbated by the increase in interest rates over the last few years. As the Bank of England raised the base rate 15 times in two years, the Standard Variable interest rates paid by mortgage prisoners shot up. Other borrowers can avoid paying SVRs by switching to a fixed rate or a tracker mortgage. The problem for prisoners is that they cannot switch and are at the mercy of the lender.
For obvious reasons, I was particularly sorry to hear about the case of Mr Wilson from Chelmsford, as explained by Earl Lytton – a dreadful situation. I now want to read some testimonies of mortgage prisoners which Martin Lewis has gathered on his Money Saving Expert website. One said, “Being a mortgage prisoner has been hell to me, you worry about losing your home, you can’t plan on starting a family and moving forward with your life.” Another said, “It cannot be fair or reasonable to transfer a mortgage to an inactive lender, hike up the standard variable rate and make it impossible to find another deal”. Whilst the market is meant to deliver choice, it’s broken if consumers are unable to switch because their mortgages have been sold to investment firms that are not authorised to make new contracts.
Mortgage prisoners deserve our attention. Many have suffered enormously already. Some are trapped paying interest-only mortgages and with little equity left in their homes. In most cases, families cannot easily move elsewhere when they have young children and strong ties to their localities. Many are unable to cope with high interest payments and are now in arrears – which narrows their options even further.
This situation is a consequence of the way government sold the mortgages of collapsed lenders back into the private sector and the failure to take proper responsibility since then. That is why I support the proposal in this Bill to set up a public enquiry to investigate the issue.
The LSE have advised that all closed book borrowers should be offered comprehensive advice. Other suggestions include equity loans on the model of Help to Buy and a government guarantee for active lenders to offer prisoners new mortgages. Clearly, this is a complex issue, but if a public enquiry can lead to decisive action to set these mortgage prisoners free, it would draw a line under the scandal, which has been going on far too long and which amounts to a deep injustice.
Second Reading of the Education (Assemblies) Bill
My Lords, I warmly welcome this debate. I thank the noble Baroness, Lady Burt, for her introduction, and other noble Lords who have spoken and I look forward to the Minister’s response. While I understand the intention of the bill, it probably won’t surprise your Lordships that I must express some reservations about these proposals and say that I believe current legislation already affords sufficient flexibility. I was interested to hear Baroness Burt quote my esteemed friend Lord Harries, former Bishop of Oxford, in favour of her bill. Perhaps it’s good that the house sees that bishops can sometimes disagree with one another.
Collective worship is a vital part of school life. It is key to fostering a sense of fellowship and cohesion, to celebrating festivals, not just Christian, and to strengthening religious literacy. Importantly, the current legislation already allows schools to tailor their provision to suit their pupils’ spiritual needs and allows schools and academies to develop their ethos and values.
Among the many benefits of collective worship is the chance to explore and understand values such as forgiveness and humility, gratitude and justice. Collective worship allows for time away from the target-driven culture of education, creating a space for the possibility of an encounter with the divine or for reflection on larger questions of the meaning and purpose of life. Children need space to ponder these things which are the province of spirituality. We are spiritual beings, and spirituality finds an anchor in collective worship. Research shows spirituality has a very strong impact on wellbeing and mental health, whether religious or not.
Some may say the removal of collective worship would allow schools to allocate extra time to cover themes such as the environment, health, relationships, and self-esteem but it is likely schools will end up using the time for extra lessons such as maths and English instead. I worry the Bill will simply remove the protection around valuable space for reflection as part of the school day. Whether in times of crisis or celebration, collective worship brings the entire community together for reflection.
There’s no doubt Britain has become less overtly religious over the past decades. Whilst fewer of us call ourselves practicing Christians, the country remains steeped in echoes of our collective faith; and many would still describe themselves as spiritual. Worship and spirituality underpin the ceremonies that shape our lives.
Often, still, it is the responsibility of the Church of England to capture and make space for expression of the national mood and many turn to faith institutions in times of life and death. The death of Queen Elizabeth II confronted us all with our own mortality, our losses and the realisation of how little control we have over our future. The late Queen’s death conjured up a latent spirituality which brought the nation together in mourning and thanksgiving.
The Church of England has always sought to bring to life the rituals that define us and it has long played an integral part in educating our children, from the first monastic schools to the inception of universities, to the founding of the National Society and the thousands of faith schools dotted around the country today. The Church takes these commitments seriously and, alongside high quality education, also offers high quality collective worship that is inspiring, invitational, inclusive and which exemplifies the principles of Christian generosity.
Worship is collective in that it involves meeting, exploring, questioning and responding to others, and for some, to God. It provides a safe space for children to ask difficult questions, and learn to sit with difference. Schools across the country used NSE resources created in response to the Southport riots on the themes of ‘I weep when you are weeping’ and ‘when there is hatred let me sow peace’ supporting pupils to explore issues arising from the news through a lens of community, cohesion and a theology of peace-making.
In schools without a religious character, the law is flexible and allows the tailoring of provision to suit their pupils needs, considering their ages, aptitudes and family backgrounds.
Meanwhile, I’m concerned that if the bill is passed, one consequence may be to make anything more than a wholly secular assembly illegal and contested in our schools. Most children would not know about the Christmas or Easter stories, nor have the opportunity to learn about other faiths if it wasn’t for collective worship.
The effect of the Bill might be to deprive young people of the chance to experience spiritual, moral, social and cultural development through collective worship. There is already provision for parents to withdraw their children from collective worship if they wish to. But when there is no space for reflection on faith, people of all faiths feel diminished, not just Christians. Whilst it is right, and I’m glad, we are having this debate, I very much hope the bill will not be progressed or at least that it will be amended at Committee stage.