A SHAKE-UP of funding flows between the Archbishops’ Council and dioceses, set out in a paper to return before the General Synod, includes £200 million of “time-limited additional support” for dioceses and the abolition of diocesan apportionment.
The package is predicted to enable dioceses to extend clergy stipends to meet up with inflation since 2011.
The update from the diocesan-finances review follows the primary report, presented to the General Synod last yr, which painted a stark picture of the Church’s financial and mission health. Thirty-five dioceses are expected to report deficits in 2023, and attendance down between 25 and 40 per cent since 2015 (News, 21 June 2024). Twenty-three dioceses hold lower than three months’ money reserves.
The review warned that dioceses had an “increased dependency” on the national church institutions, while complex financial flows were a “mystery to many”, contributing to “resentment and confusion”.
The update, written by Carl Hughes, who chairs the Finance Committee of the Archbishops’ Council, sets out a series of recommendations to be regarded as a part of the triennium spending plans for 2026-28.
It is proposed that a complete of £200 million be provided to dioceses over the course of nine years to “provide respiration space”. This would taper down over the period “as they pursue long term strategies for growth and sustainability”. The aim is to “help to stop short-term non-optimal decisions”.
The money will probably be distributed in two strands: “immediate relief”, determined by formula; and a rise within the Diocesan Investment Programme, the grant programme to which dioceses must submit bids that align with the national Vision and Strategy (News, 28 March 2023). It is hoped that the extra funding will “address short term financial pressures and fund existing ministry costs whilst waiting for missional interventions to translate into improved financial health”.
The update also proposes that Lowest Income Communities Funding (currently distributed to twenty-eight dioceses and totalling £91 million over three years) needs to be increased by one third.
The most deprived communities, the report says, have 60 per cent lower attendance and 40 per cent lower ministry per capita compared with the least deprived. The most up-to-date available data indicate that 67 per cent of the funding is allocated to parishes within the 25 per cent most deprived areas. A recent reporting framework is proposed to “show transparency, accountability and more intentional use”.
A big change proposed is the abolition of apportionment: the contribution currently made by the dioceses to the Archbishops’ Council under five separate “votes” (training for ministry; the Council’s operating budget; grants to bodies including the Anglican Communion; mission-agency pension contributions; and clergy retirement housing).
Last yr, the entire was set at £32.2 million. It makes up half of the entire cost of the five items. The Church Commissioners are funding 42 per cent.
The amount that individual dioceses are asked to pay is set by a formula that features local income levels and diocesan and parish investment income. For 2025, the entire ranges from £280,000 from the diocese of Portsmouth to £2.2 million from the diocese of London.
The review recommends that votes two to 5 be met by the Church Commissioners. On vote one, it recommends that a single Ministry Training Fund be established for ordination training costs, including all fees, living allowances, and expenses. This can be largely funded by dioceses (whose contributions would reflect diocesan wealth in addition to clergy numbers) and administered nationally by the Ministry Development Team.
The package is predicted to assist dioceses to fund one other key advice: a rise within the national minimum stipend (NMS). This follows a vote within the Synod last yr to ask the Archbishops’ Council, the Pensions Board, and the Commissioners to work along with dioceses to “explore ways through which the extent of clergy pensions and stipends may be improved in a sustainable manner”.
A non-public members’ motion from the Revd Dr Ian Paul had called for the restoration of the clergy pension to its pre-2011 profit level (News, 16 February 2024). Introducing the motion, he had said that the NMS had fallen by ten per cent between 2009 and 2019 against the Retail Price Index, while the Commissioners’ assets had grown “significantly” to £10 billion.
The review recommends that stipends needs to be increased to meet up with inflation since 2011, and that in future stipends should increase mechanically consistent with inflation, with a cap, and subject to an annual review by the Archbishops’ Council. It also proposes that a national standard incumbent stipend (NSIS) be introduced, “removing the differential stipend levels paid across dioceses so as to reduce the ‘postcode lottery’ faced by clergy across the country, supporting national deployment of clergy”.
From April 2026, the NSIS can be £34,000, and the NMS can be £32,000. The NMS for April 2025 was set at £30,110, after above-inflation increases that followed two years through which increases were below inflation.
Most of the dioceses that contributed to a 2021 review of clergy remuneration argued that a better level of stipend wouldn’t be inexpensive. The update of the diocesan funds review suggests that the package of reforms, including abolition of apportionment, should ease this.
The increase within the stipend would also raise the starting pension, which, the review says, needs to be based on the NMS of the present relatively than the previous yr. This would, it says, “mitigate the effect of changes to accrual rates since 2011”. It doesn’t, nevertheless, reverse other changes, including a discount within the pension from two-thirds of the NMS to a half.
It recommends that the Church standardise stipend levels and policies across dioceses, including maternity and paternity packages (News, 8 May 2024).
Last yr, concerns were raised in regards to the sufficiency of scrutiny of the Archbishops’ Council’s budget (News, 12 July 2024). The review calls for “a more robust and transparent framework for synodical consideration of national budgets and spending plans”.
There can be a call for further work to pilot schemes “aiming to deal with structural overheads which impact our cost base, and opportunities to scale back duplication and complexity”.
Mr Hughes says that, in weighing up the package, the Triennium Funding Working Group will “need to contemplate affordability and balance priorities alongside other funding requests”.
