THE North-East’s most senior churchman – a former financier – has backed calls for a “Robin Hood tax”, saying banking must return to serving the common good.

The new Bishop of Durham, The Right Reverend Justin Welby, spent 11 years in the oil industry, rising to become group treasurer of Enterprise Oil.

He was speaking after the Archbishop of Canterbury aligned himself with anti-capitalist protestors camped outside St Paul’s Cathedral and backed the idea of a tax levied on financial transactions.

Bishop Welby told The Northern Echo: “There needs to be a significant swing back to the idea of finance as a service industry which is there for the common good.

“It’s obviously allowed to make money in its own right, but it’s also there for the common good and to benefit the rest of society.”

On a so-called Robin Hood tax, he said: “If it can be agreed across the major economies, where 95 per cent of the financial transactions take place, then, yes, it would be a good idea.”

Bishop Welby’s intervention in the dispute only days after he was consecrated in York Minster, signals the 55-year-old’s desire to spearhead the North-East’s regeneration, which he said must be material and spiritual.

Earlier, the Archbishop of Canterbury Dr Rowan Williams, writing in the Financial Times, had described the Occupy London Stock Exchange demonstration as an expression of a widespread and deep exasperation with the financial establishment.

The protest outside St Paul’s, in London, had raised awareness of the unfinished business of financial sector reform, he wrote.

At Prime Minister’s Questions, David Cameron said Dr Williams had spoken for the whole country in condemning excesses at the top of society, and called for greater responsibility from high earners in the City of London.

However, he played down the idea of a Robin Hood tax, saying Britain would only back it if it was adopted worldwide.

Speaking last night, Bishop Welby suggested the global financial system was not working and was “a bit out of control”, leading to the North-East being side-swiped”.

“Anyone who didn’t have a certain amount of sympathy with what people are expressing, not only in London but around the world, I think would have to be very hardhearted indeed,” he said.

The St Paul’s protest has exposed divisions in the cathedral’s hierarchy, leading to the resignations of its dean, the Right Reverend Graeme Knowles, Canon Chancellor of St Paul’s Giles Fraser and chaplain Fraser Dyer.

St Paul’s has suspended legal action against the protestors and the City of London Corporation said it was pausing its action, prompting delight from protestors.

Bishop Welby said the Bishop of London, Dr Richard Chartres, had set a good model for handling such situations and said he agreed with the cathedral’s desire not to be involved in forceful, violent disruption of the camp.