GRANTS that dioceses have to bid for will remain a significant means of distributing the Church Commissioners’ funds — set to total £1.6 billion over the next three years — it was confirmed on Monday.
Asked about the “mixed record” of the projects funded to date, and a lack of transparency about results (News, 16 May; Features, 8 November 2024), the chair the Strategic Mission and Ministry Investment Board (SMIIB), Carl Hughes, argued that “the evidence that we have of the benefits and outcomes that have come from that investment have actually been very positive, and there is actually quite a lot of information that is available relating to individual projects and their outcomes.”
The Triennium Funding Working Group, which determines how to allocate the money made available by the Commissioners, announced the plans on Monday, alongside publication of the Commissioners’ annual report. The Commissioners secured a return of 10.3 per cent in 2024, taking the fund to £11.1 billion. In total, £1.6 billion is to be distributed between 2026 and 2029, up from £1.2 billion in the current triennium (News, 13 May 2022), already the largest distribution in the Church’s history.
Much of the planned distribution has already been announced. In January, a shake-up of funding flows between the Archbishops’ Council and dioceses, including the abolition of diocesan apportionment, was announced (News, 31 January). The package is expected to enable dioceses to increase clergy stipends to catch up with inflation since 2011.
On Monday, the Archbishops’ Council recommended a 10.7-per-cent rise in clergy stipends, to come into effect next April (to £33,350 for the national minimum stipend, and £34,950 for the national stipend benchmark).
Pension rises were announced last month (News, 23 May). On Monday, it was announced that additional financial support of more than £95 million for clergy retirement housing had been agreed, “both to upgrade existing Church-provided retirement rental properties and to enable these to continue to be an option for new applicants — providing long-term security of tenure on a below-market rent”.
This is in addition to “investment in new initiatives to improve choices for clergy when they retire”. This will include new Church-backed mortgage products with banks or building societies, and access to free independent financial advice at “crucial stages in ministry” — something proposed in a consultation last year (News, 2 February 2024).
The Church of England Pensions Board received a grant of £25.8 million in 2024 from the Archbishops’ Council towards the costs of clergy retirement housing. Of this, £19.7 million was funded by the Commissioners “as a response to near-term cost pressures on the CHARM scheme due to increasing financial challenges, including rising inflation, high interest rates, significantly increasing demand and more stringent regulation”.
This follows £9 million of extra funding for CHARM agreed by the Archbishops’ Council in 2023 (News, 17 November 2023). Last year, the Pensions Board warned that the scheme required “a huge and increasing investment from the Church and it is hard to imagine how this can continue as it is”, putting the annual cost at £20 million a year (News, 24 November 2023). Monday’s announcement suggests a change of heart.
Introducing the plans, the Bishop of London, the Rt Revd Sarah Mullally, who chaired the Triennium Funding Working Group, said that a recurrent theme of “extensive consultation” across the Church was that “the well-being of our clergy was really important. Clergy are at the heart of everything we do in the Church. . . In the spending plans that we put together we reflected the desire to ensure that clergy are recognised and affirmed through a range of different elements to support their welfare.”
Grants agreed by the SMIIB remain a significant means of distributing the funds: the total available over the three years is set to rise by almost nine per cent, to £416.4 million. This will include Lowest Income Communities Funding of £133.5 million, up from £91 million. There will be £48.1 million to support cathedrals.
Few independent evaluations of SMIIB-funded projects have been published in full. The Board’s latest report confirms that, last year, 12 evaluations were commissioned. A spokesperson confirmed that “the evaluations are circulated to a limited audience but not made public. The exception to this is when the diocese itself plans to publish the full evaluation.”
On Monday, Mr Hughes told the Church Times: “The approach that we are taking through SMMI is to ask and encourage dioceses to think strategically in the long-term rather than just focusing everything on day-to-day challenges.
“Hitherto . . . the evidence that we have of the benefits and outcomes that have come from that investment have actually been very positive, and there is actually quite a lot of information that is available relating to individual projects and their outcomes. . . Where we have invested in particular parishes through the programme that has given rise to considerable growth in terms of people coming to faith in discipleship in giving and also in parish share.”
He continued: “We should be absolutely honest about what works and what doesn’t. With our whole programme of this scale it would be remarkable if every single thing that we invested in was a rip-roaring success, and clearly one of the reasons for focusing on learning is to actually ensure that we do learn from past experience. . . I am a real believer in transparency in financial matters.”
The First Church Estates Commissioner, Alan Smith, described the distribution as “the largest in the Church’s history” and “the result of careful and disciplined stewardship by the Church Commissioners’ assets committee . . .
“The three-year funding process is a delicate and complex balancing act, as it must ensure intergenerational equity, being fair and just to the Church of today and the Church of the future. We are operating in volatile and unpredictable economic and financial market conditions and against a complex geopolitical backdrop. We therefore must continue to be wise in our management of the distributions.”
The funding plans include £200 million of “time-limited support” for dioceses over the next nine years, of which £100 million will be in the next three years. The aim is to “address short term financial pressures and fund existing ministry costs whilst waiting for missional interventions to translate into improved financial health”.
Mr Smith said on Monday that, with some funding set aside for “one-off time-limited purposes . . . we expect and are planning for distributions for 2029 to 2031 and 2032 to 2034 to be slightly lower”. Last year, he warned that the Commissioners’ history included “improperly thought-through commitments, including how we had shaped stipend and pensions packages” (News, 1 March, 2024).
The announcement comes against a backdrop of diocesan deficits calculated to reach £62 million in 2024 (News, 21 June 2024), with 23 dioceses holding less than three months’ cash reserves.
One diocesan secretary has identified “a shift in the focus of ‘strategic’ decision making . . . away from the bishops in their diocese to the NCIs”. He observed that “the financial flows of the past 25 years have disrupted the ancient balance of authority in the Church” (News, 31 January), and warned that “the current model of ministry funded principally through giving may be unsustainable in many places and caution applied to simply doing more of the same.”
On Monday, the Save the Parish campaign group welcomed the plans, including the abolition of apportionment and “a significant increase in support for the Church of England’s poorest parishes” for which the group had explicitly advocated.
But the chairman, the Revd Marcus Walker, said that the announcement was “not all good: they’ve decided to tie that money up in their failed Vision and
Strategy and make parishes dance like performing monkeys for the money that’s
rightfully theirs. We had hoped they’d learned from the costly failures of the last decade not to do this.”
The Save the Parish press release said: “It is clear that the Church of England’s substantial resources could be further rebalanced to strengthen parish life. The current imbalance in how these funds are allocated means that many parishes — especially in the most deprived areas — are left with fewer clergy and less support than they could have, making it harder to provide regular worship, pastoral care, and vital community presence.”
It said: “The central Church continues to make parishes ‘jump through hoops’ to access funds that by law and by legacy, should be theirs.” Mr Hughes has said that delivering grants to parishes directly would be an “administrative nightmare” (News, 12 July 2024).
The Church Commissioners’ return of 10.3 per cent follows 4.1 per cent in 2023, and five per cent in 2022, taking the average to 8.6 per cent over the past decade. The target is the CIPH inflation rate, plus four per cent: 7.5 per cent. Last year, Mr Smith warned that “we are at the cusp of how the markets are operating . . . we need to be wise in terms of how we invest and how we commit for the period ahead” (News, 12 July 2024).
The report says that returns were boosted by “the very strong environment for equity markets”, but warns that “The current geopolitical environment presents significant uncertainties for the Church Commissioners’ investment portfolio, with ongoing trade tariffs, global conflicts, and heightened market volatility all contributing to a more unpredictable landscape.”
Acknowledging the Commissioners’ ethical-investment approach, Mr Smith said on Monday: “We believe that values drive value, and that these results and the planned distributions demonstrate that ethical investing and fund growth are complementary.”
On the matter of the grants provided through the SMIIB, the annual report notes that “a specialist grant management system is in the process of being procured to further enhance the monitoring and oversight of grants (evaluating both the use and impact of the funds invested).”
