HC Deb 10 July 1995 vol 263 cc616-7
24. Mr. Tony Banks

To ask the right hon. Member for Selby, representing the Church Commissioners, what new proposals he has to improve the return on Church investments. [31462]

Mr. Alison

The total return on the commissioners' investments in 1994 was 4.8 per cent., which compares well with the minus 3.9 per cent. shown by a recognised independent benchmark that measures the performance of a large number of pension funds. The commissioners' consultant actuaries continue to advise on asset allocation strategy.

Mr. Banks

Would not the commissioners have more money at their disposal if they had not lost £800 million in property speculation? What safeguards have been built in for the protection of the clergy, particularly in terms of their pensions? Is not that £800 million loss a clear sign that the Lord does not approve of property speculation? When will the Church Commissioners remember the saying: It is easier for a camel to go through the eye of a needle than for a rich man to enter the kingdom of God"? Have they not damned their eternal souls through their actions—rather like Conservative Members?

Mr. Alison

I am delighted that the hon. Gentleman has dipped into the familiar territory of New Testament parables and other utterances. He will recall alternative words from the scriptures about making a friend to oneself of the mammon of unrighteousness—they were said by the founder of the Christian religion—and about developing talents: the man with one or two talents who increased the number to 10 was commended. I hope that the hon. Gentleman will approve of the fact that the Church of England has developed its talents substantially.

Mr. Banks

What about property?

Mr. Alison

If the hon. Gentleman has glanced at the annual report of the Church Commissioners—I arranged for it to be sent to him—he will have noted that most investment and pension funds are dominated by stock exchange investments, and could not avoid the decline in values of equities and gilts. In 1994, the total return on Church Commissioners' property holdings was £205 million; if the same amount had instead been invested in equities during that year, the return would have been a loss of £61 million. The emphasis on what the hon. Gentleman calls property speculation in the commissioners' portfolio has saved them from the big chasm that opened up before investors in equities and the like.

Mr. Patrick Thompson

I declare an interest, in that many members of my family have served or are serving as Church of England clergymen.

Will my right hon. Friend tell me a little more about how the pensions are protected, how they are calculated and whether that is affected by the return on investments? Will there be enough money to pay pensions to clergymen in the future, and what action will be taken to ensure that that is the case?

Mr. Alison

I can assure my hon. Friend that there are ample funds to meet all actuarially computed pension obligations to those who have already retired and those still in service with retirement pensions in prospect. Because of uncertainty about the long-term future, however, steps will soon be taken to introduce a contributory fund for future pension beneficiaries, making the overall package for all Church of England pensioners completely secure.