THE money paid out of long-term investments to the Church of Ireland to fund its operations may have to be further reduced, despite the recovery of the markets from the coronavirus crisis, the General Synod has been warned.
Henry Saville, who chairs the executive committee of the Church’s Representative Body (RB), said during an online meeting of the Synod that the current annual withdrawal rate of 3.5 per cent might not be sustainable over the long term.
Although it had been reduced from four per cent previously, the RB had concerns, and had launched a review to consider whether it should be cut further. This was despite the strong performance of the RB’s investment funds during 2019, increasing from €168 million to €190 million. The funds had been “hammered” during the first months of the year by the Covid-19 crisis, Mr Saville said, but had subsequently recovered.
Among the items of spending expected to increase in coming years was safeguarding, he said. “How the Church is to deliver its safeguarding responsibilities in an efficient and cost-effective manner will need to be addressed in the coming months. We must not be found wanting in our approach.”
Nevertheless, the RB remained committed to new rules agreed by the Synod in 2018 to disinvest entirely from fossil-fuel-extraction companies by 2022. All direct investments in the general fund had already been sold, Mr Saville reported, and the managers of their passive funds had been warned to restructure their holdings likewise.
Seconding the motion, the Bishop of Derry & Raphoe, the Rt Revd Andrew Forster, told the Synod that the number who had died from the coronavirus in Ireland and Northern Ireland together was six times higher than the fatalities from the worst year of the Troubles. “Think about that: 3000 lives lost on this small island. Hundreds and hundreds of families left to bear their grief virtually alone, or in unreal and very difficult circumstances.”
It made the contrast with 2019, which he described as a “great year” for the RB, even more marked. It was hard to imagine good times returning, as the world struggled to contain Covid-19, Bishop Forster said; but the way in which the RB had adjusted to its new, unexpected circumstances had given him hope: seamlessly shifting to working from home, helping to issue guidance on Covid-secure in-person worship for parishes, and offering timely loans to cathedrals that had lost valuable tourist income.
Stephen Trew (Down & Dromore) said that energy stocks had been the biggest losers in the markets over the past year. He was pleased, therefore, to hear that the RB was committed to removing all such investments from its books in the next two years. He criticised, however, the decision to use “alignment with two degrees’ warming” when deciding which oil and gas companies to exclude. It was, he argued, “vague” and poorly defined.
In response, Mr Saville said that the investment committee was “totally committed” to fulfilling its obligations to disinvest from fossil-fuel activities. There were different ways to measure or define such disinvestment, he said, but they would be happy to discuss this with Mr Trew directly to ensure that everyone was on the same page: “There is no pullback from the commitment that has been given.”
The Synod voted to receive the report. The motion for allocations was then proposed by Canon Richards, seconded by Bishop Forster, and carried by the Synod. The same pair then proposed that the report of the RB be adopted, a motion that was also carried.