§ 29. Mr. Simon HughesTo ask the right hon. Member for Selby, as representing the Church Commissioners what are the investment priorities for the Church Commissioners for 1994.
§ Mr. Michael Alison (Second Church Estates Commissioner, representing the Church Commissioners)The Church Commissioners have accepted the Lambeth report's recommendations that they should seek to maintain a portfolio that is not markedly different from that of other major bodies with comparable responsibilities. That is their long-term priority. The immediate priority is to let newly completed developments and to reduce unsecured borrowing. The commissioners also propose to take steps to adjust the imbalance between prospective sustainable income and likely expenditure.
§ Mr. HughesI am grateful for that full and helpful reply. If the right hon. Gentleman accepts that the twin planks of an acceptable investment policy should be to maximise returns to pay stipends and pensions and to behave in an ethical Christian manner, will he reflect on the fact that, last year, hundreds of millions of pounds were lost as a result of the Church Commissioners' investment policy and that it has now been decided to increase the rents of the tenants of the Paddington Churches housing association by 20 fold? Those two facts represent a failing in good investment terms and in terms of Christian ethics. If the sums involved had been public money, the Church Commissioners would have been brought before the Public Accounts Committee and would have probably been given a rough time. Would the commissioners agree to let an independent organisation look at their investments, possibly the Ecclesiastical Committee of this House and the House down the road?
§ Mr. AlisonThe hon. Gentleman will know, going back to the capital losses, that between 1986 and 1989 the value of the assets held by the Church Commissioners increased from £2.2 billion to £3 billion, an increase of £800 million, but that between 1989 and 1992 the value of those assets declined by £800 million from £3 billion to £2.2 billion. They are now in the process of increasing again and the value of the stock exchange portfolio has already gone up this year by nearly £200 million.
The real difficulty about the change in the underlying value of those assets is cash flow. Everyone is worried that the clergy will be unable to receive their stipends. That is one reason that the yield from the assets must obviously be increased, even through rent increases.