A special meeting of Diocesan Synod on Saturday heard Archdeacon Simon Fisher update members on the financial challenges that we face and our approach to tackling these.
You can download Simon’s PowerPoint Presentation here
This followed the update we gave to Synod in March where we initially outlined our situation.
You can read that report here.
Our diocese is clear about the challenges and what we see are the root cause. We have a structural deficit of £1m in our budget. This means that we cannot fix it in one year’s budget or by tweaking a few bits or by trying just a bit harder. We have to take a more fundamental look.
Liverpool is not unique in facing a financial challenge however we believe that we have a set of circumstances that are quite unique to our diocese which makes finding a solution more challenging. Those unique circumstances date from the time we were formed as a diocese with no significant land or investment assets.
This creates a twofold problem:-
- we have lower asset-based income levels than other dioceses, so we have to ask more in Parish Share to fund stipends;
- and we can’t sell a property asset or draw down an investment to make up the shortfall.
Liverpool is a poor diocese with some of the most deprived parishes in the country. We are grateful for the national church funding that helps us support frontline ministry in these challenging parishes. However, we rely on Parish Share to fund our ministry costs and that is largely funded by local giving. Pre-covid our parishes’ generosity meant we had a 99% Parish Share collection rate. Liverpool has seen the highest national take-up of the Parish Giving Scheme. We have tried and tried and tried to sustain ourselves with the resources at our disposal.
Archdeacon Simon set out the unique position of our finances and set out our five-point plan to work in partnership with the national church, parishes, and deaneries. This plan sees us:
- Being offered a £1m investment for 2023 to provide a short-term solution
- Working with the national church to gain agreement on the root cause of this challenge
- Tackling areas of outlying financial performance
- Continuing to ask parishes to pay as much Parish Share as possible
- Continuing with Fit for Mission – which is the long-term solution
Simon explained the outcome of our approach to the Church of England’s Strategic Mission and Ministry Investment Board (SMMIB) who provide financial support to dioceses through a range of means including the Low-Income Communities Funding (LInC) and Strategic Development Funding.
Their offer contained 3 parts:
- Financial support of up to £1m to offset potential Parish Share underpayment.
- Financial support to help us tackle financial under-contribution – what we call Category C parishes
- That they carry out an Independent Review of our financial situation
The financial support should be enough to enable the Board of Finance to meet our budget in 2023 and we will need to see the effect on parish share arrears. The support is currently for 2023; we will need to see what happens in 2024 after the Independent Review has concluded its work.
A plan to tackle under contribution – Category C
As part of the process, we will commit to tackling under contribution. So from a financial perspective, we have three kinds of parish that we categorise as A, B, and C.
Category A are parishes that can cover their ministry costs while making a suitable contribution to others.
Category B are parishes that receive subsidy at a suitable level
Category C are parishes that don’t contribute as much compared to other parishes with similar deprivation
Undercontribution is an issue we need to tackle so we achieve fairness between parishes while being accountable for the LInC funding and reducing the deficit.
SMMIB will fund a group of people to make a fair assessment of parishes and help identify how with support we can bring parishes out of category C status. The Category C team will work with deaneries to plan improvements which may involve increasing financial contributions, reducing ministry costs, or stopping activities that can’t be afforded. This does not mean we are changing our intentional bias to the poorer parts of our diocese but it does mean we will be more realistic about affordable Parish Share and can make good plans about stipend allocations.
The Independent Review
We believe that we are well managed and, in the main, parishes are doing all they can to support good giving. This has led us to the conclusion that we need additional investment from the national church as we have no other option. We wanted everyone to be clear that this was not an investment to plug management failure. So, we were keen to be open and accountable to Archbishops’ Council and our fellow dioceses by inviting an Independent Reviewer to examine our activities and see if there are any other approaches and solutions we have missed.
So the reviewer will be a consultant paid for by the national church and with us for a sustained period. They will get access to all decision-making at deanery and diocesan levels and be asked to produce an agreed report with an improvement plan. They will be asking how we can manage our way through our financial problems in both the short and long term.
These are challenging times but we are determined to be open and accountable, to work in partnership with the national church and our parishes. What we don’t want to do is drastically cut our missional leadership budget and cull clergy. This would be a massive detrimental step in ensuring a Christian presence in every community, not least because it would almost be inevitable that the poorest parishes, where we often have strong numerical growth unmatched by the community’s ability to give, that would be hardest hit.
We value your prayers for guidance, for SMMIB and the reviewer. We encourage you to engage with the review if you need to and to keep paying Parish Share to the fullest extent possible.
You can download Simon’s PowerPoint Presentation here
If you have any questions then contact us at pamela.ambrose@liverpool.anglican.org