Church of England hit by stock market falls
Figures published today have revealed that the stock market slump has wiped £500 million off the value of the Church of England's largest single investment fund.
The Church Commissioners said total assets fell to £3.5 billion at the end of 2002 - which comes on the back of losses of £435m in 2001.
The news comes after reveations yesterday that the major charities had also lost billions in similar investments.
The latest figures, which hare disclosed in the Commissioners' annual report show that its biggest fund suffered returns of minus 9.3%, a figure described as "very good" compared to average UK pension fund returns of minus 13.9%.
The extent of the Church of England's problems on the stock market were softened by an increase in the value of its property holdings, which make up around 40% of its portfolio. A shopping centre in Gateshead, flats in north London and the church's refusal to invest in alcohol or tobacco have also seen it through the hard times.
With a rising pensions bill and other overheads, the church - which is one of Britain's biggest investors - had been hoping for a good year.
Although the Commissioners said the results would have no impact on their immediate plans to fund clergy pensions and poor parishes, they will deepen gloom in the Church over its financial position.
Some of the most beleaguered parishes will be angry that the pay and costs of the bishops rose by £500,000, an above-inflation increase of three per cent, despite pressure on senior clergy to cut their expenses.
Andreas Whittam Smith, First Church Estates Commissioner, said things could have been far worse.
"Compared with almost all other funds, these are very good figures," she said.
"They contribute to a sustained record of good performance which reflects the success of the commissioners' long-term financial strategy in recent years."
The commissioners said that if its performance had been in line with the national average, the fund losses would have been £660m.
They also highlighted an average total return over the last decade of 10.7%, compared to 7.3% for comparable funds.
The closed fund is used to pay clergy pensions for those in service before 1998.
It is also used to support cathedrals, bishops and parishes in the most needy areas of the country.