The Church of England's financial imbalance - why not priests in parishes?

The Bishop of Truro, the Rt Rev Philip Mounstephen is pushing forward with controversial and unpopular plans for radical change in the Church of England in Cornwall  - due, he says, to falling congregations and income. 

But a recent article on Psephizo explains that there is, in fact, a lot of money around. The Church Commissioners made remarkable returns on their investments last year - and their charitable aims centre on supporting the growth of churches and ministry. So just what is going on?

A summary below -  click here to read The Church of England’s financial imbalance on Psephizo.


"The Church Commissioners have published their investment result from 2022 along with their annual report for the year, and both can be found online here.

The investment results are quite remarkable. Although the headline return last year was only 5.0% last year (compared with 13.3% in 2021), which means a real-terms reduction in the value of their assets during a year when inflation averaged around 10%, this is an astonishing result when compared with investment funds overall. According to this report, the FTSE 100 index grew by less than 1%; the US stock market fell by 20%, and only 17% of the UK funds they tracked made any positive return at all. The Commissioners' investment team have, once more, out-performed the investment market quite significantly. At a meeting last year, I asked (only half in jest) what I needed to do to pass my savings on to them so that they could invest them for me.

Where does that leave the Commissioners' assets, and the contribution from those assets to support the ministry of the Church?

The short press announcement notes that the returns have averaged 10.2% over the last ten years, giving a net cumulative growth of 164%; over that time, UK inflation has been around 47%, so the assets have grown in real terms by 117%—more than doubled. Over the last 30 years, the average return has been 10.0%, giving a net cumulative growth of 1,645% (that is, a 16-fold increase, the result of the power of exponential growth) during a period of total inflation of just 100% (due to the long season of low inflation from 1993 under Labour). So in real terms the Commissioners' assets have grown 15-fold—and they thus have a much more significant role in supporting the wider Church then a generation ago.

This fantastic success story raises two questions, one about the assets themselves, and the other about their use—questions that I explored previously at a similar time last year.

In relation to assets, the investment growth has been extraordinary—but raises the question 'When is enough growth enough?' The distributions of assets has been significant, totalling £186.8m in 2022 (an increase of 27% over 2021) plus £117.1m towards clergy pensions, the historical liability on past pensions (more recent pensions being funded by dioceses to the Pensions Board).

But each year a balance must be sought between paying money out and retaining funds to grow the asset base—which in turn will allow greater contributions in future. So the question is: how do we balance the needs of the present with the anticipated needs of the future? Which has the more urgent claim on the assets? The summary comment on p 12 of 'Our Purpose' states:

The Church Commissioners support the Church of England’s ministry, particularly in areas of need and opportunity. We do this through responsible and ethical management of a diverse investment portfolio which enables us to grow our support for the Church, by helping to ensure funding is intentionally used for mission and growth, by managing our costs effectively, and by embracing our principles of accountability and service."

The author, Ian Paul, is a freelance theologian, writer, speaker, adjunct professor of New Testament at Fuller Theological Seminary, and associate minister at St. Nicholas' Church, Nottingham, England. He is the author of Revelation (TNTC) and co-editor of Preaching the New Testament. He has a ministry of teaching and writing, and produces the widely read blog Psephizo.com. but still ministers in local churches. He has published widely at both popular and academic levels

He studied pure and applied maths at Oxford and Southampton and worked in industry prior to ordination training.