SPRING FINANCIAL CONSULTATION 2019 AGENDA Setting the context - - PowerPoint PPT Presentation

SPRING FINANCIAL CONSULTATION 2019

AGENDA

• Setting the context – Current financial position
• Update on Common Vision plans and the

Development Fund

• Discussion and Questions
• Coffee
• 2020 Budget assumptions
• Update on 2020 Parish Share and Review
• Questions and Discussion
• Prayers and close

Setting the context

2018 ESTIMATED OUT-TURN

2018 2017 Actual £000 Budget £000 Actual £000 Parochial Ministry 14,420 14,229 14,232 Administration & Finance 409 520 484 Mission in the Diocese 2,946 3,097 2,712 National Church Responsibilities 1,095 1,095 1,055 Parish Share (Net) 18,986 19,046 18,750 Surplus 116 105 268

Ho How w ar are w e we fun e funding ding the the Di Dioc

• cesa

esan n Com Common mon V Vision? ision?

• Use of Total Return Accounting in

respect of Glebe investments to release some of the capital gains that we have made on our stocks and shares while maintaining the ‘real’ value of our investments

• Grant(s) from Church

Commissioners

20 40 60 80 100 120 140

Inception 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 £M Year-ended 31 December

Gr Growth of wth of G Gle lebe be T Tota

• tal

l por portf tfoli

• lio

Real Value of portfolio (£M) Valuation of portfolio at year end (£M)

Total Return Accounting

• Permitted for Dioceses since May

2016

• Allows a portion of the increase in

endowment from original levels to be distributed in the present day while continuing to maintain the endowment in real terms for future generations

The Diocese’s approach

• Application only to Newton managed portfolio of

Stocks and Shares (currently c.£90 million)

• Base year of 2000 and endowment maintained in real

terms by using RPI

• Newton will be able to diversify from high income

yielding stocks such as oil companies

• Annual withdrawal from Unapplied Total Return pot

limited annually to 7% of opening value of Newton managed portfolio, a percentage which has been achieved (above inflation) by Newton since they took

• ver the portfolio.
• Legal advice approves this approach

The Diocese’s approach

• Limited to three years initially
• Will keep withdrawal rate under

review.

• Should yield around £7.5 million
• ver first three years.
• This will be split between

Development Fund and Strategic Initiatives

Questions

What questions would your group want to ask about the Common Vision process?

2020 Diocesan budget and Parish Share

Clergy stipends and salary increases 2%(2%) Curates in training 52 (50) Clergy vacancies 30 (28) (2019 numbers are included in brackets)

Parameters

18.0 20.0 22.0 24.0 26.0 28.0 30.0 32.0 34.0 36.0 38.0 40.0 42.0 44.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Total vacancies 2018 2017 2016

Buildings repair costs inflation 2% (2%) Central controllable costs 0% (0%) Share under-collection rate 2.25% (2.4%) Share increase 1.8% (1.75%)

Non-Ministry related areas

Can we operate a share scheme which is fair for all?

Principles Principles of

• f the Oxf

the Oxfor

• rd

d diocesan diocesan parish parish shar share e sc scheme heme:

• 1. Must be fair and not be seen to be

unfair

• 2. Should reflect the ability to pay
• 3. Should not immediately penalize

growth

• 4. Should be allocated at deanery

level except where diocesan engagement is necessary

Principles Principles of

• f the Oxf

the Oxfor

• rd

d diocesan diocesan parish share scheme (cont’d.)

• 5. Should be based on generous

and gracious giving plus mutual support

• 6. Should be easily communicated

We apply a formula-based system rather than an offer-based system

Outcome Outcome of

• f the

the Shar Share R e Review view Gr Group

• up
• No c

No chan hange ge to to principle of principle of alloca allocation a tion at t Deaner Deanery le y level el

• Tempor

emporar ary y incr increas ease of e of rur ural al allo allowanc ance e by £2 by £200k 00k to co to cover cer er certain tain rur ural al deaneries deaneries whic hich ar h are e not cur not currentl ently y able ble to contribu to contribute te an an amoun amount consiste t consistent with nt with cler lergy numbe y numbers but will s but will nee need d mor more e cler lergy to meet oppor y to meet opportunities of tunities of the the Oxf Oxfor

• rd to Cambridge

d to Cambridge cor corridor ridor

Out Outco come of me of the the Share Review Group (cont’d)

• Fur

Further r ther review of view of inconsistencies inconsistencies in the alloca in the allocation of tion of rur ural al allo allowanc ances es will will be do be done ne for the

• r the

2021 2021 alloca allocation tion

• Other

Other chan hanges ges con consider sidered ed and and modelled modelled but the but the outc

• utcome
• me would
• uld

be una be unattr ttractiv active in t e in ter erms ms of

• f

reco ecover erability bility

How do we compare?

• We asked for £499 per member in

2018, compared with £602 for the highest diocese and an average of £466 for all English Dioceses

• The average unrestricted income per

member for parishes across the Diocese in 2017 was £1,200

• Church of England national guidance

is that church members should contribute 5% of their net income in voluntary giving.

Costs per Minister - 2019

2019 budget Costs per minister £ 2018 budget Costs per minister £ Stipends, NI and Pension contributions 39,196 38,345 Housing costs 11,826 11,231 Ordinand and Curate training costs 12,813 12,711 Parochial Ministry support 4,670 3,994 Diocesan Mission Strategy 5,989 6,950 Compliance and Governance 2,574 2,698 National Church costs 3,556 3,363 Fees and other income (4,245) (4,480) Total weighted cost per minister 76,379 74,812 Glebe income support per minister (12,646) (12,121)

Questions and comments?