*** DEBUG START ***
*** DEBUG END ***

C of E Pensions Board exceeds target return

20 July 2018

But annual report still shows deficits of more than £300 million across its pension schemes

PHOTOGRAPHY BY MARK WOODWARD AND DANIEL EASTON

General Synod in 2018

General Synod in 2018

THE Church of England Pensions Board has exceeded its target return on investment, but recorded total deficits of more than £300 million across its pension schemes, its annual report states.

The Board controlled assets worth £2.6 billion in 2017 — an increase of about 11 per cent from a total of £2.3 billion in 2016 — which delivered a return of 9.4 per cent. This figure was “significantly ahead” of its annual target returns of three per cent above inflation, the report says.

This increase brought net asset returns over the past 15 years (after fees and costs) up to an average of nine per cent per annum: the equivalent of six per cent above inflation. This was largely because of the “exceptionally strong investment return” for 2016 of 21.2 per cent, the chief investment officer of the Board, Pierre Jameson, said on Wednesday.

The Board has four pension schemes, which provide pensions for about 40,000 people. It carries out actuarial valuations of each of these once every three years.

The main pension scheme for stipendiary clergy for service from 1998 onwards is still in deficit by £236 million, but the Board is on target to recover this deficit by 2025, Mr Jameson said. “There is a deficit-recovery plan which has been in place for several years to recover deficit by 2025, and we are on target to meet that.”

The next valuation of the fund is due to be carried out at the end of this year.

The Church Workers Pension Fund, which covers about 450 employers of lay staff, including diocesan offices, was the last fund to be valued, at the end of 2016, and reported deficits of £43 million.

The chair of the board, Dr Johnathan Spencer, writes in his foreword to the report that the “complex” scheme of many sections had suffered in the economic climate, and that some employers therefore “faced the prospect of an unanticipated negative impact” on their pension fund. “We agreed with each employer a plan to address the funding of their sections, and completed the valuation early in 2018.”

Ethical investment has been an important consideration when investing the Pension Fund, he continues. The Board last year announced a new policy on investing in extractive industries, which “acknowledges the positive contribution that mining can make to development and the material that it provides for many of the products in modern life.

“However, it also highlights that extractives companies are particularly vulnerable to poor governance and ethical controversy, and harmful, long-lasting impacts on communities and the environment.”

Its total income was consistent with the previous year at £28.8 million (£28.4 million in 2016).

Income from grants, donations, and legacies was equal to 2016, at £6.2 million, which included a grant of £4.6 million from the Archbishops’ Council (up from £4.4 million the previous year).

Mr Jameson concluded: “Even given our long-term expectations, it is a much better set of returns than we might have expected at the beginning of 2017, particularly in the context of having achieved well over 21 per cent the previous year.”

Browse Church and Charity jobs on the Church Times jobsite

Forthcoming Events

Green Church Awards

Awards Ceremony: 6 September 2024

Read more details about the awards

 

Festival of Preaching

15-17 September 2024

The festival moves to Cambridge along with a sparkling selection of expert speakers

tickets available

 

Inspiration: The Influences That Have Shaped My Life

September - November 2024

St Martin in the Fields Autumn Lecture Series 2024

tickets available

 

SAVE THE DATE

Festival of Faith and Literature

28 February - 2 March 2025

The festival programme is soon to be announced sign up to our newsletter to stay informed about all festival news.

Festival website

 

Visit our Events page for upcoming and past events 

Welcome to the Church Times

 

To explore the Church Times website fully, please sign in or subscribe.

Non-subscribers can read four articles for free each month. (You will need to register.)