The Diocese of Lincoln is running an annual cash deficit of around £3 million and five working groups have been set up to help achieve a balanced budget.
In its recent ‘Annual Accounts 2018: Financial Summary’, the diocese revealed the deficit has been steadily increasing for some years and “is not sustainable”.
Of the £9 million expected income for 2020, 50% is expected to come from parish share. This is the money given by individual churches to contribute towards the stipend, pension, housing and training of their vicar.
The current amount being received in parish share from churches falls substantially short of those costs (£7.9 million), by £4 million per annum. Clergy costs represent the largest cost to the diocese and account for 50% of the expenditure budget.
Other main costs to the diocese are Mission and ministry parish support at £2 million (17% of total expenditure) and those relating to legal, professional and governance at £1.3 million (11% of total expenditure).
The majority of these costs are salaries of staff at Edward King House. Reducing the amount of staff would change what the diocese is able to offer parishes. It will be necessary to look at the number of posts it has at EKH.
The financial summary says: “For several years, bridging the gap between the parish share income and the clergy stipend costs has been met by disposing of our assets.
“Although this does result in an immediate injection of funds, we lose a proportion of the interest (income) on the greater amount of the asset, thus putting further pressure on our finances.
“Whilst the diocese has some historic assets, by 2021 we will have reached the safe limit of what we can sell off to pay the deficit without causing damage to those assets.”
It added that Lincoln is not the only diocese experiencing financial difficulties with others also struggling to balance their books for reasons. The reasons include increased overall expenditure, low levels of reserves and the amount received in parish share not keeping pace with these increases.
The new five working groups
Five working groups have now been established to look at different area of income and expenditure. They will then propose ways to improve “the missional and financial health of the diocese”.
The following groups will meet several times before a final report is presented to the Bishop’s Council on July 1:
- Growth – look at increasing the number of worshippers; investigating ways in which growth is being achieved here and elsewhere around the country
- Assets – maximising the diocesan asset portfolio
- Central Diocesan Costs – looking at costs and service delivery levels; reviewing other models of central service delivery
- Deployment – this will look at a number of models of deployment, including lay ministers and readers, as well as ordained clergy
- Parish Share – looking at the giving culture of parishes in the diocese as Lincolnshire has the lowest amount of giving in the country. Other parish share schemes from around the country will also be looked at.