The Taylor Review: Sustainability of English Churches and Cathedrals was commissioned by the UK government in March 2016 on the back of the WW1 Cathedral Grant scheme and the report published in December 2017 with a summary of the current situation and recommendations, including a demand for more government money.
After reading I’ve concerns about the findings of the Sustainability Review, the focus on taxpayer support of an existing business model and the bias of the panel members towards a finding of this nature. Aside from specific issues with the report itself I see a key church issue that really needs to be addressed, that rather than being the Established Church of England, she is in danger of simply becoming a Nationalised church:
- Too conservative to adapt to a changing market
- Too large to be allowed to fail
So increasingly demanding of government support.
This note details my specific concerns on teh report constructions and findings, with some recommendations of my own.
Panel Members
“…. over recent decades there has been an increasing recognition that the Church of England cannot be expected to shoulder the burden of caring for many of the country’s most important buildings — including 45% of those listed grade I — without significant, ongoing help.”
Church Buildings Review Group report, 2015, Rev Dr John Inge
The panel consisted primarily of figures involved in the church, to grant receiving bodies or both. Reports (as quoted above) support our concerns that the panel already had conclusions in mind before beginning their work.
The panel needed representatives from a much broader background and who could adopt a flexible and open minded approach to possibilities.
The panel also needed greater financial experience to support conclusions with detailed rigour and analysis.
Church Wealth
“You can apply for Universal Credit in your area if:
- you have savings of less than £16,000”
Citizens Advice Eligibility Guide
Most instances of taxpayer support must show financial need, which includes not only income but also savings and investments. Financial support for the Church of England should also be considered on the same basis and should include the complete church rather than simply a single legal entity.
A rough measure of church wealth includes:
- Church Commissioners : £8bn
- Diocese : £4.7bn
- Cathedrals : £1bn
- PCCs : £1 to £10bn (estimated)
These figures do not include supporting charities such as Friend of Cathedrals or independent charities of the CoE such as the Church Urban Fund or Allchurches Trust, which also have considerable funds available.
The difficult truth is the funds to pay for church repairs are there, but the church authorities would rather spend the money elsewhere. Actual need is not being assessed or taken as a primary consideration.
Parish Funding for Building Repair
An important aspect of church sustainability is whether the Parish Church Councils (PCCs) can afford to pay for church repairs. While most are not registered charities (being exempt) the parish finance figures in aggregate are available as each year the PCCs report their accounts to the Church Commissioners. These are then distributed via the Parish Finance Statistics Report, the latest of which is 2015.
These figures show that in 2015 the combined income of the PCCs at £1,025bn, with profits of £54.4m, a profit margin of 5.6%. This is not an isolated year, the cumulative profits for the PCCs over the last ten years stands at £212.1m. This income is not related to the national church bodies, diocese or cathedrals, just the PCCs themselves.
Against this figure for PCC income and profit is the cost of church repairs. In 2015 the figure for Major Church Repairs stood at £106.7m, just 11% of the total for expenditure and less than a third of the figure paid to the Diocese Board of Finance.
It is clear from the figures there is no current need for additional funding for PCCs to be able to afford church repairs.
Existing Government funding of PCCs.
While the Sustainability Review proposes new government funding it is important to recognise the current high levels of government support, principally via Gift Aid. The report highlights the removal of Tithe income but does NOT stress the level of support subsequently provided by Gift Aid, which is a direct loss of income tax revenue from the treasury.
The timeline for Gift Aid support is as follows:
- 1990 Introduced with a minimum donation level of £600
- 2000 Minimum level removed
- 2013 GASDS scheme introduced, principally for churches
- 2016 GASDS donation limits extended to £8,000
So in relative terms Gift Aid is a very new form of government church support.
In 2015 the Parish support provided by Gift Aid amounted to £91.1m. This is the second largest single source of net income after Planned Giving and shows the high level of support already provided by government policy.
Almost matching this figure is Total Grants (principally direct and indirect government funding). In 2015 this stood at £88.0m. Taking a conservative estimate that 80% of grant funding is from government sources this means we have a combined government support figure for PCCs of £161.5m, equivalent to 15.75% of church income.
Therefore the general taxpayer already provides enough support to the Church of England to cover the entire church building repair bill.
Historical Funding Arrangements
“The Tithe Act 1936 effectively abolished tithing as a requirement,”
The Sustainability Review stated the Tithe Act 1936 removed church funding, is this strictly accurate?
The historical and unworkable Tithe Rentcharge was indeed ended in 1936 however compensation in the form of interest bearing government stock was issued to the church. This was paid over to the Queen Anne’s Bounty (a forerunner of the Church Commissioners) and should have then been distributed to parishes. If this did not occur this is a church internal matter.
In fact the Tithe Rentcharge had stopped being paid to parishes under the terms of the Tithe Act 1925, which transferred all tithe income to Queen Anne’s Bounty. So again this body may or may not have been passing on the income to parishes prior to 1936.
Church wealth redistribution
Tithe income was just one instance of the changing patterns in church financing as the wealth of the church has not been removed but centralised for redistribution. As well as the Tithe Act other historical changes also must share responsibility for the current funding status.
In 1835 an Ecclesiastical Commission was set up to reform the finances of the Church of England and especially to appropriate existing church income to support new urban parishes. Income from the richer parts of the church was moved to a new central fund for redistribution to support the wider church. This process of centralising income and assets, while leaving behind costs and responsibilities has continued ever since.
The Ecclesiastical Commission Act 1836 was the first to take income from the cathedrals, while the Act of 1860 took all the lands and income, in exchange for an endowment that was supposed to cover their costs:
… an Arrangement shall be made as soon as conveniently may be, and with all reasonable Despatch, for assigning to the Archbishop or Bishop of such See and his Successors, as an Endowment for the See, such of the Lands and Hereditaments then vested in the Ecclesiastical Commissioners for England as in the Judgment of the Estates Committee of the said Ecclesiastical Commissioners, and subject to the Approbation of such Archbishop or Bishop, may be deemed convenient to be held as such Endowment, and will secure as nearly as may be, after deducting Costs of Management, a net annual Income equal to that named for the Archbishop or Bishop of the See by any Act of Parliament or Order in Council then in force, and no more;
If the endowments were not sufficient then the Church Commissioners (who took over the central investment management role) should have increased them.
It was not only the Church Commissioners who appropriated land. The Endowments and Glebe Measure 1976 took glebe land from the parishes and gave them to the Diocese Boards of Finance, so parishes now have to pay for church repairs from their own funds, while also paying Parish Share to the Diocese Boards of Finance who also took their land.
Even any payments under the Land Compensation Act 1973 were to be paid to the DBFs or Church Commissioners.
So in conclusion tithe income was not taken. It was merely one action in almost two hundred years of asset stripping of the parishes and cathedrals to build up the national church institutions. Institutions that wish not to provide further support to repair the buildings left behind.
Parish non-collection of income
One reason the Church of England is enthusiastic about central government taxpayer grants and benefits is the long held antipathy of local taxpayers to supporting the church. People are generally accepting of paying taxes if the service being delivered is suitable and of good quality, church services do not meet that requirement for the majority.
Chancel Repair Liability is a long standing (but complicated) law forcing some local property owners to pay for repairs to a parish church chancel. Almost no actions are taken to collect these payments from local homeowners due to ill feeling. Even the Church Commissioners themselves (who are responsible for paying chancel repairs on land they originally took) ask that the fees not be collected as it depresses their land values.
Another historical form of local church income, chargeable against all in the area is the setting of a Church Rate. This can be set by a local parish on ALL parishioners whether church goers or not and remains legally in place. While legal the ability to enforce the rate was removed by the Compulsory Church Rate Abolition Act 1868 when it became voluntary. Once again, the lack of desire by non-churchgoers to support a parish church means such a rate is (almost) never set.
In conclusion, there is little evidence of local secular desire to support the parish church and repairs should be supported by active parishioners only. This should be extended to tax payments channelled to churches through central government. If there is no local secular appetite to maintain churches in their current form then central tax payments should follow this lead.
The primary issue — conflicted priorities
Aims & Activities: Promoting the mission and ministry of the Church of England especially by supporting poorer dioceses with ministry costs, providing funds to support mission activities, paying for bishops’ ministry and some cathedral costs, administering the legal framework for pastoral reorganisation and closed church buildings, paying clergy pensions for service prior to 1998 and running the clergy payroll.
Church Commissioners charity Aims & Activities
The Church of England struggles to balance two roles; custodian of historic buildings and Christian evangelism. Both require investment from a single pool of resources, which will be given top priority? Evangelism.
The fact is not readily admitted but the Church of England is run as a business, looking for new sources of revenue, investing in the means to gain this and ignoring or disposing of non-performing assets. These activities fall far short of trying to radically change the church but simply aim to keep it operating as it currently does. More mission leads to more adherents which keeps the edifice afloat.
Unfortunately this high level of investment in mission means support for heritage is pared back and alternative funding sources sought. It would be impossible to have taxpayers support mission to allow the church to focus on heritage so the opposite strategy is adopted.
So the key problem with the current model of seeking sustainability is that the Church of England can afford to pay for church repairs but does not want to. The church wishes to spend money in other ways. This simply points out that the current church structure and organisation is no longer sustainable and must change.
Recommendations
In response to the recommendations in the Taylor Review, here’s my list of recommendations that more closely matches the reality of the situation of the church and public feeling.
1. Stop specific and direct central government church funding
Nationalising the Church of England will never be sustainable. Central funding becomes too politicised and not justified by the current wealth of the recipient.
2. Support a single route for all built fabric heritage funding.
All heritage building should be treated and considered equally and each judged on merit. Experts in the area should manage any government support for heritage repairs independently. They should be neutral as to type of building, judging simply on merit and ability to pay
3. Simplify the Church of England corporate structure
The church should merge Cathedrals and PCCs into each Diocese. Thousands of separate charities with their own trustees can now become just 42 regional bodies (or fewer if diocese merge too). This will vastly reduce the number of trustees required, accounting, record keeping and distribution of income and resources. The clarity of administrative streamlining will prove cost effective and help support a simpler and smaller CoE
4. Investigate splitting of property and mission
The hotel industry is moving quickly towards a model where one body builds and owns the property and an operating company leases that building. This may help the church focus on mission, while a separate organisation manages just the buildings. The church can easily leave behind a church building when a parish stops by giving up a lease and the manager of the buildings can quickly sell or re-use.
This model may allow each body to focus on their own assets rather than a continuous process of compromise.
5. Change focus from church buildings to community needs
The government should adopt a community-centric approach for local support rather than starting with a church building and attempting to make this the community focus. In many cases it may be the ideal answer but not all. Allow each community to stress whether they’d prefer a shop, pub, sports facility, park or church to be grant funded.
6. Ensure CoE prioritises maintenance over mission
Ensure the CoE first funds and carries out what must be done before what could be done. This means paying for church repairs before funding salaries, new buildings or mission initiatives and proving this has been achieved.
7. Focus primarily on financial need for any government funding
The whole wealth of the CoE should be considered as a single entity when assessing financial need, rather than just the individual body requesting support.
8. Change recipients of church building sales
If a church is sold then all or part of the proceeds should go to the local community rather than to the CoE. The local community has over time supported, maintained and paid for the church. The nave has long been a resource for secular purposes and if sold this resource is lost and should be recompensed.
9. Deduct church repair costs from Parish Share
Currently the parish share cost is inviolate, however as the Diocese ultimately owns church buildings any necessary repairs to keep the building in good order should be offset against the Parish Share due. This will encourage repairs to be carried out as a priority to meet obligations before providing funds for mission.
10. Accelerate reduction in religious focus of church buildings
A majority of people are turned off churches by the overwhelming amount of religious iconography. Faster laws should be introduced to allow the removal of church specific furniture and fittings, to make the building more secular more speedily. This could include the removal of all pews, lecterns, and the faster conversion of separate rooms to secular functions and supporting facilities such as toilets.
11. Cancel Chancel Repair Liability
This anachronism should be officially repealed, for the benefit of both the church and property owners.
Conclusion
There is a long history of failing industries being nationalised and supported by government largesse. Almost all fail to maintain their power and status at a large cost to the taxpayer.
The Church of England is no different. With fast falling numbers of adherents it is not possible with any amount of taxpayer funding to bring it back to the size it once was. The only honest and manageable solution is to allow the organisation to self manage to the point it is a viable business once more, even if this is as a further diminished and restricted service provider.
The sensible course of action for the UK government is to assist and if necessary accelerate the acceptance of this, helping to reduce the complexity of the church and reducing the administrative overhead from being part of the establishment.
