THE First Church Estates Commissioner, Sir Andreas Whittam Smith, presented the Church Commissioners’ annual report on Friday afternoon.
Sir Andreas that, against a target of inflation plus five per cent last year, the Commissioners had achieved growth of just over eight per cent. The average over the past 30 years had been 9.7 per annum growth. Although he had warned of the difficulties of maintaining this (he cited the slowdown of the Chinese economy and the undermining of confidence in governments’ ability to deal with recessions, given that interest rates could be cut no further), he reported that the fund was “slightly up” since the day of the referendum.
The Commissioners had been prepared, “to some extent, well” for Brexit, selling property, investing in private equity (delivering growth of 12.5 per cent per year), and forestry. The decline in the value of sterling since the vote had been of “great benefit”; for 45 per cent of their assets were outside the country.
Although he saw some warning signs, including a persistent fall in yields on government securities, he assured the Synod that, even if assets dropped by five per cent per annum for eight years, commitments could still be met.
Penny Allen (Lichfield) asked whether the Commissioners could consider investing in social housing and credit unions.
Sir Andreas said that the Commissioners had contributed “substantially” to the Church’s credit union, and had bought much “strategic land with good development prospects”. They insisted that developers include a high proportion of social housing, where possible, he said.
Canon Giles Goddard (Southwark) welcomed the growth, but said that it “implies greater use of the world’s resources”. Were the Commissioners moving fast enough towards a low-carbon economy by 2020?
Sir Andreas said that the Commissioners reviewed their portfolio all the time; and he pointed to recent shareholder resolutions, such as that put to BP, as evidence that “engagement does make a difference.”