The financial management of the Diocese of Leeds
Leeds Diocesan Trust – comments on accounts from expert sources.
Massive spending
Leeds Diocese has been spending more than it received in income ever since Bishop Roche took over in April 2004:
Year ended 31st March: Deficit (excluding investments)
2005 £1.4 million
2006 £1.7 million
2007 £1.4 million
2008 £1.6 million
While the parishes have had to cut their expenses by nearly £200,000 during his episcopacy, the diocese’s own central spending has continued to increase. (Cathcon- schemes, projects, schemes, projects must have more of them all!)
To prop up this massive over-spending, Leeds has been selling off its investments. For example in 2005/6 the diocese sold off a massive £5.8 million of investments. Only £410,000 of that was reinvested - the rest was spent.
This process is clearly due to continue; the 2008 accounts show that it plans to sell a further £2.1 million of church buildings and similar property.
Debts
In its last accounts, the diocese had an overdraft and short-term loans of a shocking £13.8 million.
Yes it had £17.5 million of investments to set against this. But £5.7 million of that was held in “restricted funds”, legally ear-marked for specific projects (mostly for priests’ pensions). The diocese’s “unrestricted” investments were just £11.8 million, and that was before the falling stock market wiped out millions.
Investments
The diocese has relied heavily on its investments for the last few years, with rising investment values helping to balance the books and some large sales of investments providing cash to fund its spending.
But as with most investors the recent enormous falls in the stock market will have left large holes in this safety net. Two thirds of the diocese’s investments were in shares, and so between March and November 2008 it lost £3 million on the stock market.
Note:
Unless stated, the figures above are for the central diocese (“curia”), and so exclude the parishes. As the accounts state, parishes are “separate” under Canon Law, and so parish funds “are not available for the non-parish general purposes of the charity.”
Cathcon- a fine example of the mismanagement of decline so often talked about here.
How Bishop Roche responds to the wishes of the Pope.
Expensive and disloyal bishop.
Comment from the Holy Smole blog
As for two-thirds of the diocese's investment portfolio being in shares, there need to be some serious questions asked of the investment advisor too. I work with client fund portfolios, and one assumes that when the markets started diving, the share element of the portfolio was dumped fast and the proceeds placed in bonds and cash?
If not, there you have a scandal on your hands!
Cathcon investigating exactly what programmes the Diocese supports when not closing churches.
Massive spending
Leeds Diocese has been spending more than it received in income ever since Bishop Roche took over in April 2004:
Year ended 31st March: Deficit (excluding investments)
2005 £1.4 million
2006 £1.7 million
2007 £1.4 million
2008 £1.6 million
While the parishes have had to cut their expenses by nearly £200,000 during his episcopacy, the diocese’s own central spending has continued to increase. (Cathcon- schemes, projects, schemes, projects must have more of them all!)
To prop up this massive over-spending, Leeds has been selling off its investments. For example in 2005/6 the diocese sold off a massive £5.8 million of investments. Only £410,000 of that was reinvested - the rest was spent.
This process is clearly due to continue; the 2008 accounts show that it plans to sell a further £2.1 million of church buildings and similar property.
Debts
In its last accounts, the diocese had an overdraft and short-term loans of a shocking £13.8 million.
Yes it had £17.5 million of investments to set against this. But £5.7 million of that was held in “restricted funds”, legally ear-marked for specific projects (mostly for priests’ pensions). The diocese’s “unrestricted” investments were just £11.8 million, and that was before the falling stock market wiped out millions.
Investments
The diocese has relied heavily on its investments for the last few years, with rising investment values helping to balance the books and some large sales of investments providing cash to fund its spending.
But as with most investors the recent enormous falls in the stock market will have left large holes in this safety net. Two thirds of the diocese’s investments were in shares, and so between March and November 2008 it lost £3 million on the stock market.
Note:
Unless stated, the figures above are for the central diocese (“curia”), and so exclude the parishes. As the accounts state, parishes are “separate” under Canon Law, and so parish funds “are not available for the non-parish general purposes of the charity.”
Cathcon- a fine example of the mismanagement of decline so often talked about here.
How Bishop Roche responds to the wishes of the Pope.
Expensive and disloyal bishop.
Comment from the Holy Smole blog
As for two-thirds of the diocese's investment portfolio being in shares, there need to be some serious questions asked of the investment advisor too. I work with client fund portfolios, and one assumes that when the markets started diving, the share element of the portfolio was dumped fast and the proceeds placed in bonds and cash?
If not, there you have a scandal on your hands!
Cathcon investigating exactly what programmes the Diocese supports when not closing churches.
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Comments
What exactly is the Diocese of Leeds doing if it has a £1.5 million deficit annually (do they have no income)?