From the Secretary to the Church Commissioners
Sir, — Ray and Anne Lane
(Letters, 8 April) are unhappy that the Church Commissioners’ loans, which
finance a large part of the loans to retired clergy for their homes in
retirement, made such a high investment return in 2004. On the back of the
housing boom, the return was 16.5 per cent, and over the past five years it has
been 21.2 per cent.
It was not always thus. Not so long ago, the loans were the Cinderella of
the Commissioners’ portfolio, with lower returns than their other investments.
The terms of the loans are set at a level that enables affordable loans to be
provided to retired clergy while, at the same time, providing the
Commissioners’ fund with a long-term return in line with their other
Inevitably, there will be periods when, like housing, the loans earn high
returns; but there are also periods when the return is very low: 2005 could be
one such period.
The Lanes quite fairly characterise the loan repayments (or interest) as no
more in real terms than rent. Where else could anyone rent a property for an
annual rent of as little as four per cent of the property’s purchase price? And
that comes with a guarantee that the “rental” will increase only in line with
the combined clergy and state pensions.
Any relaxation of the terms of the loans would directly reduce the amount
of money the Commissioners can make available for the support of the Church’s
ministry. We think we have the balance right.
London SW1P 3JZ
From the Revd Nicholas Pedley
Sir, — I am most grateful to Ray and Anne Lane for commenting on the
pitfalls of the Clergy Retirement Home Loans Scheme. My situation may be
unusual, but highlights the anxieties caused by this form of never ending
I retired from stipendiary ministry through ill health in 1999, aged 51,
and my wife and I entered into what, I think, was then termed an “Equity
Sharing Mortgage”. The repayments were based on our joint income, of pension
and incapacity benefit and my wife’s disability allowance. It seemed our only
option, other than renting, and it enabled us to have something to leave our
children on our demise.
Nine months later, my wife became very ill, and died within a week. She was
42. Still ill myself, I was left to care for my two children, then aged nine
and 14. My wife’s benefits died with her; so life became quite a struggle.
However, my mortgage payments remained the same, and the payments have risen
each year at the same rate as the pension increase. Consequently, I slowly
become worse off.
Added to this, I am financially responsible for all maintenance and
repairs. I have had to pay for the property to be rewired and flat roofs
refelted. To date I have spent approximately £4500 on the home, money I will
never see again, as I am merely keeping the property in good order for the
After my wife’s sudden death, I considered moving to be closer to friends,
and asked if I could transfer the current equity (house prices having risen
considerably) to another property. I was told this was not possible: I would
have to repay the mortgage and apply again. However, the loan amount had not
increased. I was priced out of the market; so any thoughts of a move were
I am now content to remain where I am, as I cannot afford to move. However,
I remain greatly indebted to the Corporation of the Sons of the Clergy and
other charities and my local MP, who have seen us through some very difficult
times. There are positives: although my mortgage will never be repaid, we have
a home, and I thank God for it. But the problems that I have experienced do
seem to highlight some of the anomalies of the Church Housing Scheme.
33 Comber Grove, Kinver
West Midlands DY7 6EN
From Canon Maurice Harper
Sir, — I retired in 1985 and took advantage of what then seemed a generous
scheme to obtain a retirement home. I provided £6250 (plus £1000 to meet the
vendor’s lowest price of £33,250), and the Pensions Board gave £26,000 to
purchase a house at the surveyed price of £32,500.
In 1995, my wife had a triple artery by-pass operation, and it seemed
prudent to move into a smaller, single-storey property. Such a property would
have cost as much as, or more than, the one we had, which had at that time
risen in value to around £78,000.
I asked if the property could be sold and the proceeds used to purchase
another; but, in spite of offering to pay all expenses involved, I was told
that under the scheme the Commissioners must have their money back. They would,
of course, consider giving me a new loan! If this was agreed, my monthly
payments would have increased by £64 or £74. I could not afford this. The
result was that I was obliged to stay where I was and accept the difficulties.
Had I been able to move, the Commissioners would have lost nothing. They
would have continued to receive the same payments while their share of the
profits appreciated. The final straw was when I realised that with the
repayments going up in line with clergy pensions, I was actually paying 7.7 per
cent on the original £26,000 loan, when the bank rate and most mortgages had
Eventually, in 2003, by which time the value of the property had reached
£175,000, my family decided that enough was enough, and came to my rescue with
funds to purchase a much smaller home.
In one letter from the Pensions Board, the Housing Manager mentioned that
there were a lot of clergy in the same position as I was. Perhaps it is time
something was done about it.
30 Cookham Dene
East Sussex TN40 1RU