The Vatican’s financial situation must be “a glass house” that displays transparency and honesty, letting Catholics know where its revenues come from and go, said the head of the Secretariat for the Economy.
Presenting a detailed budget report of the Roman Curia for 2019, Jesuit Fr Juan Antonio Guerrero Alves said Catholics “have the right to know how we use the Holy See’s resources. We are not the owners; we are the custodians of the assets that we received.
“Those who ask for transparency are right. The Holy See’s economy must be a glass house. This is what the Pope asks of us,” he said in an interview with Andrea Tornielli, editorial director of the Vatican Dicastery for Communication.
The Vatican press office released the interview and the secretariat’s ‘Consolidated Financial Statement’ of the Roman Curia for 2019 October 1, days before the annual Peter’s Pence collection was to be taken up in Catholic parishes around the world. The collection, usually taken in June, was moved to October 4 because of the Covid-19 pandemic.
For 2019, Fr Guerrero said that the Roman Curia, which is made up of 64 entities, had a budget deficit of €11 million. The statement showed it had €307 million in revenues, €318 million in expenditures and a total of €1.4 billion in net equity.
Deficit
If the financial statements of Vatican City State, Peter’s Pence, the Vatican Bank, various foundations and the Vatican pension fund were added, he said, then net assets would come to about €4 billion and there would be no deficit.
However, he said, that did not mean the Vatican was not facing any difficulties or that things would not get worse because of the coronavirus crisis.
Referring to ongoing news reports about Vatican investments, most notably a London property deal being investigated by the Vatican, Father Guerrero said, “it is possible that in some cases, the Holy See has been not just poorly advised, but also swindled.
“I believe that we are learning from past mistakes or imprudence” and putting into high gear the measures needed to guarantee transparency, controls and collaboration between dicasteries, he said.
Donations, which include contributions made to Peter’s Pence, which amounted to €66 million in 2019, covered 35% of the costs of the Curia carrying out the Pope’s mission and specific projects specified by the contributors, he said. The Curia’s infrastructure and service costs, he added, are covered by other funds.
Peter’s Pence, which funds papal charities as well as supporting the Curia and Vatican embassies around the globe, “must be managed with the wisdom of an honest administrator”, he said.
Fr Guerrero also said clarity and transparency about the London property deal is essential, particularly because of the confusion and upset it has caused.
In the meantime, he said, “I can say the losses (incurred in that deal) were not covered by Peter’s Pence, but with other reserve funds of the Secretariat of State.”
Slightly more than half of all revenues for the Roman Curia 2019 came from income generated from assets such as investments and real estate, he said, while donations from dioceses and Catholic donors totalled €56 million or 18% of revenues.
The Vatican must make sure the debt is sustainable and “we do have to find a way to sustain the mission in the long run” with adequate resources and improving returns from investments”
Expenditures totalled €318 million for 2019 with the bulk, €207 million, going to curial offices dedicated to “apostolic mission” work, including the Dicastery for Communication (€46 million) and the apostolic nunciatures around the world (€43 million). Asset management services (including taxes and building maintenance) for the Administration of the Patrimony of the Holy See cost €66.6 million and “services and administration”, for example, the Secretariat of State, various oversight agencies and the Swiss Guard, cost €44 million.
Because the Holy See does not operate like a business or a country, “it does not seek profit or surplus” he said. “Therefore, it is normal that it be in deficit.”
Expenditures
The Vatican dicasteries account for the bulk of the Curia expenditures, he said, but they are providing services that “are not sold or sponsored…avoiding a deficit is not the goal of the Holy See. Its spirit is something else,” that is, fulfilling the mission it has been entrusted with, he said.
However, the Vatican must make sure the debt is sustainable and “we do have to find a way to sustain the mission in the long run” with adequate resources and improving returns from investments and real estate assets, he added.
“The Faithful want to contribute to the Church’s mission, but it is essential there be a policy of external transparency and communication that can share in detail how we use the money we receive and manage,” he said. “This is the objective we want to reach; this is the path the Holy Father has pointed us to.”
The Vatican had not released a budget report to the public since 2015.
Pope Francis established the Council for the Economy, the Secretariat for the Economy and a general auditor’s office in 2014 and approved their statutes on a trial basis in 2015 as part of a major overhaul of the Vatican’s accounting and budgeting procedures.
Starting in 2014, all depart-ments, bodies and foundations of the Holy See were required to report all assets – which totalled €1.1 billion, as well as liabilities – which totalled €222 million.
The Vatican’s final figures for 2014 showed a budget deficit of more than €25.6 million on the part of the Roman Curia, but that deficit was offset by a €63.5 million surplus brought in by entities falling under the separate Vatican City State budget.
The Roman Curia again reported a deficit of €12.4 million in 2015, while Vatican City State reported a surplus of €59.9 million, in large part due to revenue from the Vatican Museums.
The interview with Father Guerrero revealed that for 2018 the Holy See had a deficit of €75 million. However, he told Mr Tornielli that figure included some “extraordinary” costs, although he did not specify what they were.
Carol Glatz is a correspondent with Cruxnow.com