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Commissioners' investments hit nine-year high

30 May 2014


Out-of-town protest: campaigners gather outside Westminster Abbey on Wednesday, to challenge the Church Commissioners' investment in Grovebury Retail Park. See story, below

Out-of-town protest: campaigners gather outside Westminster Abbey on Wednesday, to challenge the Church Commissioners' investment in Grovebury Retai...

THE Church Commissioners were last week celebrating the best results for their investment fund in eight years, after their annual report was published, showing that their portfolio had grown by 15.9 per cent.

This took the total value of the Commissioners' fund to £6.1 billion, and was the best annual return since 2005, when the fund achieved an increase of 19.1 per cent.

The Commissioners' investments comfortably surpassed their target return of RPI inflation plus five per cent, which in 2013 amounted to 7.7 per cent. They also beat a common comparison fund that reported an 11-per-cent return last year.

The Secretary to the Church Commissioners, Andrew Brown, said on Wednesday: "I am delighted to report the very strong investment performance the fund produced. As our annual report shows, the Commissioners continue to identify and fund the Church's work in areas of need and opportunity throughout England."

The annual report showed that the Commissioners spent £207.8 million last year, of which almost two-thirds was for clergy pensions. The remainder was spent mostly on grants to poorer dioceses (£34.4 million), archbishops and bishops (£31.2 million), and cathedrals and church buildings (£12.9 million).

Of the amount that the Church of England's spends each year, 15 per cent comes from the Commissioners, and almost three-quarters from giving by parishioners, the report says.

When returns are averaged out over five, ten, and 20 years, the Commissioners have still beaten their inflation-plus-five-per-cent target. Over the past two decades, the average annual return has been 9.6 per cent, and the fund has grown from £2.4 billion in 1994 to £6.1 billion today.

The First Church Estates Commissioner, Andreas Whittam Smith, writes in the report: "2013 was a very good year for the portfolio. Everything that could go right did go right. Indeed, it may prove to have been a turning point, the moment when the Church decisively increased its focus on securing numerical and spiritual growth in church membership."

Gavin Oldham, chairman of the stockbroker The Share Centre, and a former Church Commissioner, said that the Commissioners had every reason to be pleased with their performance.

"It was a very successful year," he said. "I'm very pleased for that longer-term success, which has completely expunged the difficulties they had at the beginning of the 1990s. It speaks a lot for the quality of the Commissioners team."

The £6.1 billion of investments controlled by the Commissioners are highly diversified, and include stakes in, among others, commercial and residential property, timber, farmland, company stocks, and hedge funds. Among their investments, the Commissioners own the Royal Lancaster Hotel near Hyde Park in London, as well as a ten-per-cent share of Britain's largest shopping mall, the MetroCentre in Gateshead. After UK Government Treasury bonds, the next biggest stock-exchange holdings were in Royal Dutch Shell, Vodafone, HSBC, and BP.

The Commissioners' investments came under the spotlight last year after it emerged that they had a small stake in the firm that owns Wonga, the payday lender that had been criticised by the Archbishop of Canterbury (News, 26 July 2013).

At the time, the Archbishop said that it was "irritating", and promised that it would not happen again. The Commissioners' annual report admits, however, that, with certain investments, they cannot insist upon adherence to their ethical-investment policy (which is against investing in a company where more than 25 per cent of turnover comes from high-interest-rate lending).

"While we would like to remove our small investment exposure to Wonga, we may not be able to do so for some time," the report says. "However, we cannot achieve - and do not seek to achieve - a 'perfectly ethical' portfolio. The investment and business environment is complex and imperfect; recognising our own imperfections, we seek to use our influence as investors to positive effect."

In recognition of the fund's excellent performance, the most highly paid member of staff at the Commissioners received a £91,000 bonus - boosting his or her salary to £334,000 a year.

A spokesman for the Commissioners declined to comment on who the individual was, or how the bonus was calculated.

On Thursday, the Commissioners' Head of Investments, Tom Joy, was named investment head of the year at the annual Asset Investors European Innovation awards.


A "THRIVING" high street will be destroyed if a new out-of-town retail park, backed by the Church Commissioners, goes ahead, campaigners warned this week, writes Madeleine Davies.

Protesters gathered outside Westminster Abbey on Wednesday to challenge the Commissioners' investment in Grovebury Retail Park, which will be located 1.5 miles south of Leighton Buzzard town centre.

Victoria Harvey, an environmental campaigner in Leighton Buzzard, believes that the park will cripple the town, which is currently a "social hub".

"The Church Commissioners will be making money by destroying our high street and community, and going against the town council, the community forum, and a strong public campaign," she said. "The developers openly admit that they will be taking £2.09 million a year from the town-centre shops. We believe that it will be far more, and will destroy our high street and community."

The park, which has received planning consent from Central Bedfordshire Council, is being built by Claymore Group, in partnership with the Church Commissioners, who own the land.

On Monday, a spokesperson for the Church Commissioners said: "We respect the right of anyone to voice their opinion and stage a peaceful protest. Equally, the Commissioners always take into account local interest and planning regulations, and take seriously their obligation and right under the Charities Act to seek the best price possible while selling land or buildings.

"Both the planning and legal processes in this case have been thorough. The proposed development at Grovebury, Leighton Buzzard, will, in the judgement of the authorities, provide a much-needed facility for the town, will attract new inward investment, and will create a large number of jobs for local people."

Miss Harvey said: "The Church Commissioners are supporting a new myth that people should shop out of town by car in an impersonal retail park, and then come into town for coffee and community events; but people do not have the time to do both.

"Shopping is both a necessity and a new leisure activity, and if it takes place in a town centre, community events can take place alongside it. Shoppers get to know the local shopkeepers and market-traders, who put them in touch with other groups, and community is born.

"Local shopkeepers and market stall-holders often provide invaluable listening and social support and community creation to many people. The town centre on market days is a social hub for many pensioners who cannot afford to get out otherwise."

Ms Harvey is supported in her protest by her father, Canon Anthony Harvey, who was Sub-dean of Westminster Abbey from 1982 until his retirement in 1999.

He said: "The Christian faith is all about mutual service and responsibility in a community. The mission of the Church of England is to be a model of a mutually dependent and caring community. When I see a Christian agency such as the Church of England apparently abandoning this mission in favour of commercial interests I feel bound to protest."

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