CLERGY pensions, and what could be done to restore them to previous levels after a cut in real terms, was debated by the General Synod on Monday afternoon.
Introducing the debate, the Revd Dr Ian Paul (Southwell & Nottingham) moved his private members’ motion asking the Archbishops’ Council, the Church of England Pensions Board, and the Church Commissioners to “find a way to make use of the whole range of assets and resources across the Church to enable the restoration of the clergy pension to its pre-2011 benefit level as soon as possible”.
He reminded the Synod that, for 20 years, there had been “real anxiety” about the state of the Church’s finances. “We took what felt like necessary steps,” he said: the pension had been cut as a proportion of the national minimum stipend (NMS), and the years of service had been increased. The clergy pension had effectively been cut by one third in real terms.
The NMS had since dropped by ten per cent between 2009 and 2019 against the Retail Price Index. Meanwhile, the Church Commissioners’ assets had grown “significantly” to £10 billion, while diocesan assets stood at £800 million, he said. “Our financial assets, overall, as a Church, are enjoying rude health, while our ministerial assets — serving and retired clergy — are feeling discouraged, demoralised, and devalued. This cannot be right.”
The annual cost of restoring the pension to pre-2011 levels had been calculated to cost about £25 million, while, in one year (2020), the Church Commissioners’ assets had grown by £900 million. If they took on responsibility for pensions for the next 20 years, the total cost would be no more than five per cent of their entire asset base.
“This is not a big ask; but it would make a big difference,” he said. “We know from research that the single most significant factor in reversing the decline we are seeing, and seeing our congregations grow again, is the funding of well-motivated stipendiary ministry that is intentional about growth. What greater priority can we have as a Church than caring for such people?”
He had not proposed putting financial pressure on dioceses, he said. There was a need to put the Church’s assets, and the needs that he had outlined, together. “Synod, isn’t it remarkable how quickly we can find the money for the things we think are important?” He reminded the Synod that, when it had made changes in 2008, it had made a commitment to restoring the pension to its previous level. “We can do this; we should do this; we must do this.”
The chair of the Archbishops’ Council’s Finance Committee, Carl Hughes (Archbishops’ Council), moved an amendment that asked the three bodies mentioned in Dr Paul’s motion to “work together with dioceses to explore ways in which the level of clergy pensions and stipends might be improved in a sustainable manner”. In doing so, they should have regard for the findings of the recent clergy-remuneration review (2021), including the policy that the NMS should, in future, on average, increase in line with inflation, as measured by the Consumer Prices Index including owner occupiers’ housing costs (CPIH).
He agreed with Dr Paul that the clergy pension should be “adequate and equitable for cohorts of retirees over time”, and that this should apply to clergy stipends, too. Inflation levels for past 18 months had been at their highest level since the 1990s, and this, combined with the challenges of the pandemic, had meant that stipends had not been increased in line with CPIH. Data suggested that the NMS was almost £4000 less than if it had tracked CPIH since 2010.
He hoped that all parts of the Church could work together to improve stipends, over time. Dr Paul’s use of the words “find a way” sounded “like a commitment that we find we are unable to keep”, he said. Solutions needed to be sustainable.
Dr Paul accepted the amendment.
The chair of the Pensions Board, Clive Mather (Ex Officio), emphasised that the Board did not set benefits: the Synod did. “It is, at heart, a policy question.” The Board had provided two technical papers, which noted that the mechanics of changing future service were “relatively straightforward”. If the motion was carried, the Board would work with the Archbishops’ Council to work up proposals and spell out all of the implications.
Mr Mather spoke in support of a forthcoming amendment from Ian Boothroyd. As an “ordinary layperson”, with decades of experience in pensions, he would vote for Mr Hughes’s amendment and the motion, he said. “Retirement living standards really matter, and have slipped. If the NMS is not keeping pace, then the value of starting pensions falls; we must not lose sight of this, and focus exclusively on the accrual rates.”
The Commissioners had “many ongoing responsibilities”, and there could be less expensive ways of trying to “unwind” the 2008 changes, as set out in the technical note. The introduction in the UK of a “Collective Defined Contribution” pension could be a “game-changer”, he suggested.
Robin Lunn (Worcester), an independent financial planner concentrating on pensions, spoke in favour of the amendment, but had concerns about the original motion. He was reminded of the final line of a documentary about Gorbachev: “In looking to reform the Communist Party and the Soviet Union, he ended up destroying it.” Mr Lunn was concerned that changes proposed to the pension scheme could end up being detrimental. Defined-benefit schemes were “extremely costly”, and there were very few left in the UK. Tweaks to the C of E pensions scheme had enabled the Church to maintain it, he said. His definition of “pensions heaven” was having the defined benefit as the base, but another type of pension — money purchase — alongside it. When it came to the Church Commissioners, assets could go down as well as up.
The Revd Brenda Wallace (Chelmsford) was in support of the amendment. As a clergy pensioner, her licence had been extended when she retired from full-time work. She lived on her state- and church-pensions, having been a wife and mother for almost all her working life — half of that as a stipendiary priest. She lived “adequately — just”. But she was able to do so only because of inheriting a “small and somewhat dilapidated” bungalow. She did not need to pay rent or depend on the “rapidly disappearing and increasingly expensive CHARM scheme, which is itself under question”. For the clergy, retirement brought additional costs, such as council tax, which were increasing, she said. But, without the contribution of largely unpaid retired clergy, many rural parishes or those in an extended vacancy would not be able to sustain sacramental worship or pastoral offices.
Geoff Crawford/Church TimesThe Revd Brenda Wallace (Chelmsford)
The First Church Estates Commissioner, Alan Smith, in support of the amendment, said that, in his parish church, the person who gave him most inspiration was a 90-year-old retired vicar. “How we support our clergy — those who served yesterday, those who serve today, and those who will serve tomorrow — . . . has and must always be our top priority.” Sustainable actions might be explored, he said. The Church Commissioners had to do so in “a spirit of humility”. He reminded the Synod of what had happened in 1992. One book had relayed that “the Church Commissioners in one year nearly achieved what Oliver Cromwell had tried and failed to do, which was to destroy the Church of England.”
The key issue, he said, was not poor investments, but “improperly thought-through commitments, including how we had shaped stipend and pensions packages, actually going back to as early as the late 1940s and early 1950s, which came through to bite us at the end of the 1980s and early 1990s. What we nearly became then was a pension fund which had a bit of Church appended to it. We cannot let that happen again. . . We want and need a flourishing clergy supported by sustainable and sustaining benefits packages, of which pensions is a key part.”
Also in favour, Julie Dziegiel (Oxford) was a member of the Archbishops’ Finance Committee, but spoke as the vice-chair of the Oxford diocesan board of finance, a deanery treasurer, and a former parish treasurer. In the “church-money merry-go-round, the dioceses are the squeezed [in the] middle . . . despite receiving a lot of grants from the Church Commissioners”. The balance was always made up by parish share, but, even when it was not met, the diocese still had to pay clergy. She was “flabbergasted” by the speed at which the reduction in diocesan pension contributions had been used for other expenditure: paying clergy and staff “relatively modest raises”, and keeping parish share affordable. Dioceses did not have the funds to afford the proposed uplift in pensions: there would be an “outcry” from parish treasurers. “This request cannot be achieved within the financial structures as they are at the moment, at least not without the loss of a considerable number of clergy posts, which would cost much great harm to the work of our Lord Jesus Christ.”
The Bishop of Hereford, the Rt Revd Richard Jackson, who chairs the remunerations and conditions sub-committee of the Archbishops’ Council, said that to go back to the 2011 settlement was “unrealistic”. The amendment brought in the dioceses as partners in the conversation. “There needs to be a new conversation between the various arms of the Church, the various charities that comprise our Church, as to where this money for this pension increase and stipend increase is going to come from. And I think it’s most unlikely that it will come from dioceses and parish contributions.”
The amendment was carried.
Ian Boothroyd (Southwell & Nottingham) then moved an amendment to request that the three bodies mentioned in Dr Paul’s motion “consider what steps may be taken to remedy the fall in the real value of pensions for clergy retiring since 2021, and to avoid such a fall reoccurring in any future period of high inflation”. The pensions scheme had been “unable to react to the damage done by recent high inflation to the pensions of clergy reaching retirement”. Clergy who retired in 2024 would have a worse deal than predecessors in the previous three decades.
He explained: “The value of the pension at the point of retirement is a small share of the national minimum stipend for each year of service, all added together. The current maximum is half the NMS. But it isn’t the current NMS, it’s last year’s, and the year of April to March.” Total inflation since 2021 was more than 20 per cent, whereas NMS had increased by only one per cent. Clergy were retiring with about one sixth less church pension than if the calculation had kept pace with inflation. This was an injustice. The group affected needed “special treatment”.
Dr Paul wanted to test the mind of the Synod.
The Revd Martin Thorpe (Liverpool) spoke in support of the amendment, having attended a union fringe event where he had spoken to a retired member who also had to apply for benefits, and was affected by the changes to Universal Credit. His level of income was set to fall below the “barely adequate floor of our social-security system. That cannot be right. But it is happening now.” Clergy pay and pensions were “rightly about sacrifice and covenant”.
He had been called to ministry in his early twenties, away from a career as a research chemist. He had known “full well” that he would be earning as a curate half what he had been earning as a chemist. “But I was told at that point that the Church would look after me; there was a generous pension scheme; I would work the 37 years that would get me to full pension when I was 65: two-thirds of stipend.”
He had also been advised to sell his house to help to fund his training: “the worst piece of financial advice I ever had”. He was set to retire this year with a pension, after 30 years of service, of £9000 a year. His wife, who had worked half the number of years in a teachers’ pension scheme would get double that. Could the Church Commissioners not use some of their £10 billion assets to restore levels? “Our clergy, active and retired, surely deserve better.”
The Revd Graham Kirk-Spriggs (Norwich) said that some people were reluctant to talk about money: “I am not one of those people. The terms and conditions that we are suffering as clergy are . . . an absolute scandal. A clergyperson now earns less in their stipend than a first-year teacher.” He was aware of clergy in his diocese who were being charged £500 a month in energy bills, and were being told that they needed to go on a budgeting course. “We are a Church of social justice; and this is a matter of justice. . . It is a scandal that one in five people have had to rely on the Clergy Support Trust.” One fellow cleric had been advised not to sell their house, but to keep it for retirement. “What house?” he asked, to laughter and applause. “It might be all right for those of you who bought your house in 1973 for a packet of crisps and 14 pence. . . The rest of us are left behind.” Clergy having to apply for benefits was “the kind of thing that Amazon does: relying on state handouts to maximise their profits. . . This is the most worldly thing that we do: the way we treat the people that work for us.” He had considered leaving the Church, over the level of stipend, “because, month after month, it is not enough.”
The amendment was carried.
The Revd Barry Hill (Leicester) supported the amended motion. In the coming weeks, the accountancy firm BDO was set to produce its report on diocesan finances. “They will show very significant financial deficits in many dioceses — probably, in total, running well into eight figures, with all of the impact that will have on mission and ministry.” The Finance Committee had reported in York last summer a significant real-terms reduction in giving from parishioners. Given the average age, this was likely only to increase, “as parishes struggle to cover the cost of their ministry”. Meanwhile, in the past year alone — and in almost every year that almost everyone present had been on the General Synod — the asset base of the Church Commissioners had increased by more than the entire stipend bill. In this context, the “most elegant” solution that he had heard was to invite the Commissioners, through legislation, to take on post-1997 clergy-pension contributions. This would make a “vast difference” to mission and ministry in many parishes, he said, and most dioceses. It would save the average diocese about £1 million, or about 15 clergy posts a year, but would cost less than one third of one per cent of the Commissioners’ asset base: less than one tenth of the money they already gave to dioceses.
Paul Ronson (Blackburn), also a member of the Finance Committee, said that the Diocesan Stipends Fund Measure had highlighted the “total inadequacy” of many diocesan stipend funds. He proposed that the Commissioners consider a “one-off, generational, resettlement” to “rebalance” all of these funds: it would be ring-fenced to pay the clergy and their pensions.
Prebendary Pat Hawkins (Lichfield) said: “If we want to remove the barriers for those from estates, from working-class backgrounds, to ordination, we cannot leave the livelihood in ministry or in retirement to those who either have inherited wealth or a well-paid spouse.” Her sister had had to take early retirement from stipendiary ministry to care for her husband in 2020. She had lost the pension she had already accrued because she did not meet the criteria for early retirement. Everyone who had heard this story had been shocked by it. When her husband died, she lost part of his pension, and was stranded short of her state pension. The issue needed to be looked at in the broadest possible way.
Canon Bruce Bryant-Scott (Europe) spoke as a “grumpy old man” currently collecting a full pension after 35 years of service in the Anglican Church of Canada. He had also spent nine years on the pensions committee of that Church. He came from a Province in which clergy pay was increased in line with inflation. When he arrived in the C of E, the idea that clergy were being paid less in real terms was “shocking and appalling”, as was the fall in pensions. He would not feel sure that he could reassure clergy considering entering ministry or in their early years about the pension awaiting them, he said.
Canon Paul Cartwright (Leeds) had entered theological training in 2006. At that time, he and his wife were told to sell their house, but they had been able to keep it. He came from an estate, and his parents had not taken up the right to buy. They had left £800 to each child when they died. It would be his wife’s pension that “carries us through”. He had been diagnosed with leukaemia in 2008, while training, and had had to sign away some of his pension; so, were he to die from leukaemia, his wife’s payout would be reduced. It was time to take pensions away from the diocese, he said, “so they can concentrate on mission”. The Commissioners certainly had a bigger bank balance. He supported Canon Hill’s proposal.
The amended motion was carried by 382 nem. con. It read:
That this Synod
(a) request the Archbishops’ Council, the Pensions Board, and the Church Commissioners to work together with dioceses to explore ways in which the level of clergy pensions and stipends might be improved in a sustainable manner, with reference being made to the impact of changes to clergy pension benefits and the National Minimum Stipend (NMS) since 1998, including the change in level of the pension benefit from 2/3 of NMS prior to 2011;
(b) in doing this work to have regard to the findings of the Clergy Remuneration Review (GS 2247 and GS Misc 1298) and in particular the policy that the National Minimum Stipend should, in future, on average, increase in line with inflation (as measured by CPIH) subject to three yearly reviews and the need to review this position if high levels of inflation establish themselves; and
(c) request the Archbishops’ Council, the Pensions Board and the Church Commissioners to consider what steps may be taken to remedy the fall in the real value of pensions for clergy retiring since 2021, and to avoid such a fall reoccurring in any future period of high inflation.