THE FRAMEWORK

Common Fund I would like to start with asking you to reflect and consider a couple of questions

What do the words mean to you?

Towards our mission across the diocesan family Financial Contribution Exceptional Offering Gifts in Kind Partnerships 4 Ways of Common Fund Towards our mission across the diocesan family Financial Contribution The annual monetary giving or contribution Exceptional Offering May be a church receive extra unexpected resources in any given year and they want to contribute extra – there was an inner city old mission hall that was being used as a boxing club – there was proceeds due to the PCC, they made an exceptional offering of proceeds as they wanted to give thanks for the generosity of others who over the years had contributed to the cost of their ministry /priest when they had struggled Gifts in kind Every church has gifts and skills given by God and its how we help each other – chelmsley wood example Partnerships How we work in partnerships with others – our neighbouring parishes, across our deaneries, with other ecumenical partners – how we can deepen our discipleship and witness on a day to day basis All of this is a family commitment to our shared mission and not about just sorting our selves out in our parish.

Embedded in People & Places framework 4 Ways of Common Fund Need an allocation method that underpins P&P framework of deployment based on population and place Need a method that helps us to reimagine ministry & mission that is long term sustainable An aid to help focus discussions on what future ministry & mission could look like & what partnerships we forge

Financial Contribution No more than 60% of Unrestricted income as Contribution How to deal with the financial contribution element ? There is as many ways as there are dioceses – no single way is perfect and yes there will be times when it can feel like you can’t do right for doing wrong! Its about balance, finding a middle ground – actually being very Anglican! In Birmingham, we used to being given an amount to contribute – that has been our tradition, our culture. And its probably got a lot to do with not having much historical wealth to fall back on, so the family has had to quite proactive, upfront about the quantum of contribution. But feeding in our response to the sharing of God’s generosity, it was felt right that we moved to a 2 part contribution: A calculated sum requested that linked in with the P&P deployment framework – so its all joined up A gift discerned by the parish itself With the underlying principle of not expecting any place to contribute more than 60% of its unrestricted income.

Why is 60% of unrestricted income important? Parishes need to have to have the ability to pay for the “day to day” running costs of being church Unrestricted funds are by their nature free to be used for the parish running costs To give every encouragement for sustainability When we reviewed % of old common fund ask against unrestricted income we had a number of parishes in particular poorer parishes with asks in excess of 75/80/ 90/even 100% of unrestricted income – strangely enough did not collect it Unrestricted is given freely and may be used at the discretion of the PCC to further mission. As apposed to restricted when the donor says its for X purposes and that only. - example here in the cathedral – sum given to build a new cathedral in-between the war years.

Actually its 60% ADJUSTED unrestricted income Running costs of Hall Things in the wrong place Legacies Unrestricted per Statutory Accounts Things in wring place: DBF element of fees Collections for others Restricted grant and donations Halls – massive blessing and some main source of income but can be significant costs associated – so only dealing with the “net result” The rest of expenditure that is up to discretion of the PCC is dealt with in the 40% left What have we learnt’ – National Church finance returns only give too summarised data and need to delve into the accounts themselves Adjustments able to see to make only as good as the clarity of the disclosure in the accounts – if its not obvious its difficult to spot –so help me out Now some people may get excited and think great I can reduce the 60% maximum and “pay” less- 2 points on that its missing the biblical roots of sharing in gods generosity and it probably doesn’t really achieve anything, they wish to just hang on to their priest- other than the place looking unsustainable and they will be encouraged to share ministry . The framework is designed to help parishes get over the hump of parochial and being family.

60% of ADJUSTED unrestricted income Then Compare….. Costs of ministry deployment in P&P framework 1.Oversight 2.Oversight + Context 3. Current 4. Current + Context 60% of ADJUSTED unrestricted income FTE cost of a Minister = £48,760 P&P allocations depend on spreading resource on basis of population

How do the figures work out….. Adjusted Unrestricted income Running costs of Hall Things in the wrong place Legacies Unrestricted per Statutory Accounts £150,000 - £15,000 - £10,000 = £125,000 Things in wring place: DBF element of fees Collections for others Restricted grant and donations Halls – massive blessing and some main source of income but can be significant costs associated – so only dealing with the “net result” The rest of expenditure that is up to discretion of the PCC is dealt with in the 40% left What have we learnt’ – National Church finance returns only give too summarised data and need to delve into the accounts themselves Adjustments able to see to make only as good as the clarity of the disclosure in the accounts – if its not obvious its difficult to spot –so help me out Now some people may get excited and think great I can reduce the 60% maximum and “pay” less- 2 points on that its missing the biblical roots of sharing in gods generosity and it probably doesn’t really achieve anything, they wish to just hang on to their priest- other than the place looking unsustainable and they will be encouraged to share ministry . The framework is designed to help parishes get over the hump of parochial and being family.

How do the figures work out Cost of P&P deployment: 60% of ADJUSTED unrestricted income = £75,000 1.Oversight = £32,424 2.Oversight + Context= £44,317 3. Current= £48,760 4. Current + Context= £60,653 Oversight allocation = 0.66 Context allocation =0.24 Current = 1.0

How do the figures work out Cost of P&P deployment: 60% of ADJUSTED unrestricted income = £75,000 1.Oversight = £32,424 2.Oversight + Context= £44,317 3. Current= £48,760 4. Current + Context= £60,653

How do the figures work out Cost of P&P deployment: 60% of ADJUSTED unrestricted income = £75,000 1.Oversight = £32,424 2.Oversight + Context= £44,317 3. Current= £48,760 4. Current + Context= £60,653

How do the figures work out Cost of P&P deployment: 60% of ADJUSTED unrestricted income = £75,000 1.Oversight = £32,424 2.Oversight + Context= £44,317 3. Current= £48,760 4. Current + Context= £60,653

How do the figures work out Cost of P&P deployment: 60% of ADJUSTED unrestricted income = £75,000 1.Oversight = £32,424 2.Oversight + Context= £44,317 3. Current= £48,760 4. Current + Context= £60,653 Part 1: SUM REQUESTED = £60,653

Financial Contribution £60,653 ?

Discerning the Gift… Intentional generosity Sharing for those unable to afford Oversight All curates in training Parish services To Suggest a Gift or Not????? Basic stats: 31 parishes based on current deployment patterns are self sustaining 120 are not in current format 28 parishes are struggling with their oversight – there is no one context/ or geography Is useful to make a suggestion or not on gift? – tricky one as its parish decision – but had a few parishes say its quite new to us so initially some clues for us to pray about and discern would be really helpful Question : if there are no gifts what happens? – apart from me going totally grey overnight – we will be back to the drawing board.

Discerning the Gift….. What we give…. Is between us and God What God expects of us… Is that each of us will shoulder our responsibility as member of our Church family to the best of our ability We are faith raising not fundraising Taken from some stewardship conversation with Amanda Homer when people ask her well what should we give

Financial Contribution £60,653 £10,000 £70,653 Normal year get to end of October to give indication of gift so we can see for diocesan synod how it all plans out

Thank you for last year, this year and in advance for next year

Recap from Last Year… 2019 2020 2021 2022 £’000 Annual Deficit (880) (949) (1,057) (1,168) Cumulative (1,829) (2,886) (4,054) Resulting 4 year plan if NO ACTION This would wipe out the DBF unrestricted fund during 2022

Can We Fix it……? Yes We Can …..! With the Full Implementation of People & Places Framework and some central cost savings……. Yes We Can …..!

Uses funding received in advance of need Overall Draft 2019 Budget Core £’000 Mission Programme P&P with CC support Other Funds Total Income 10,207 1,004 526 232 11,969 Expenditure (10,221) (1,245) (526) (326) (12,318) Surplus/ Deficit (14) (241) - (94) (349) Use of B/f 14 241 94 349 Net position Uses funding received in advance of need P&P, New Cfund & Savings

Core - P&P assumptions (1) Common Fund Illustrative framework yields £5.8m Factored in possible under collection Collection rate % comparable to now In cash terms increase of 4.27% on 2017 Example framework only – final detail by parish will change with the conversations – letter out to treasurers with illustrative figures for discussion Factor – on a detailed parish by parish basis, looking at past history & experience

Core - P&P assumptions(2) Parish deployment is at 119 by 1 January 2019 This is a reduction of 6 FTE stipendiary posts from where we are now Average vacancy rate is 9 (same as 2018 budget) Central core cost savings @2 FTE stipendiary costs to be made This works hand in glove with the common fund framework Work in hand on central cost savings

Remaining Core Assumptions Lower Income Community Funding remains as advised - £1.9m Investment dividend yields of 3.6% Fees 3.5% lower than 2017 achieved Stipend & lay increment -2% Clergy pensions remain at 39.9% No additional lay posts unless externally funded Spending on restricted fund missional programmes only what we have got. Cautionary letter from AC that may need to relook at this – budget risk Investment yields advised by S&W and takes into account investment of proceeds like sale of land in Austry coming through in 2019 Increment is currently midpoint on Office for Budget Responsibility projection of CPI in 2019 1.8% and average wage inflation of 2.43% - remember we only did 1% in 2018

5 year forecast impact- Core 2019 2020 2021 2022 2023 Clergy no. 119 112 Vacancy 9 Curates 21 C Fund (2%) £5.8m £5.9m £6.0m £6.1m £6.3m Total income £10.2m £10.3m £10.4m £10.6m £10.7m Context - 230k 409k 359k 345k Total expenditure Balanced Total income sees possible impact of new plants adding into the mix £65k in 2022 then £75k in 2023 Transformational leadership and context - not yet defined but this is the amount available for context ministry from a prudent common fund prediction