The Assembly Council spent the bulk of its November meeting dealing with finances. It endorsed a number of changes to the church’s pension plan and approved a set of 10 “budget principles” to guide the creation of the national church’s 2014 budget.
You can find the Council’s complete budget principles in the minutes of the Assembly Council.
Pension Plan
Effective Jan. 1, 2013, contributions to the pension plan will increase for congregations, employees and employers.
Congregations will contribute five per cent of their dollar base (up from 3.1 per cent) to the pension fund, ministers and other employees will contribute nine per cent of their qualifying income (up from seven per cent), and employers will contribute nine per cent (also up from seven per cent).
A new formula will be used to determine future pension benefits. From Jan. 1 onward, benefits will be calculated using a 1.5 per cent career average formula. It will calculate the pension an employee has earned each year based on his or her salary in that year.
Under the previous final average formula, benefits were calculated based an employee’s five highest earning years and the number of years he or she worked for the church.
The new calculation will result in lower benefits for most employees.
The old formula will be frozen as of Dec. 31 and will be used to calculate benefits for preceeding years.
None of the changes will affect current retirees.
The steps are meant to “get us to July 2014,” Tom Fisher, convener of the Pension and Benefits Board, told the Assembly Council.
The pension plan faces a solvency deficit of $48.7 million. The 2012 General Assembly granted the Council the power to make changes to the plan to address the funding shortfalls.
Presbyterians Sharing
“Continued membership decline and the need of congregations to contribute more to the pension fund and health and dental premiums dictate that it is prudent to reduce the Presbyterians Sharing income goal,” the Council said in its budget principles.
It set the budget of Presbyterians Sharing, the church’s national mission and ministry fund, at $7.5 million for 2014. That is $500,000 less than the $8 million budgeted for 2013.
Donations to Presbyterians Sharing totaled $8.1 million in 2011 and 2010, and $8.5 million in 2009.
In principle, the Council also approved a new, simplified formula to calculate congregations’ suggested allocations to Presbyterians Sharing. Based on the biblical idea of tithing, the formula would ask congregations to contribute 10 per cent of their revenue each year. It is expected to come before the General Assembly for approval.
“Our goal would certainly be higher than what we’re currently bringing in, but it would be more achievable [than it has been in the past],” said Karen Plater, associate secretary of Stewardship. “If healthy congregations that can contribute 10 per cent actually do, we would meet the $8 million mark.”
Currently, each congregation is asked to contribute 13 per cent of the first $50,000 of its dollar base, 18 per cent of the next $50,000 and 21.5 per cent of the remainder. The dollar base is calculated by taking the total amount received by a congregation for use in a given year and subtracting all money remitted for mission purposes and debt repayments.
Biennial Assemblies
A meeting of the church’s highest court costs almost $300,000, the Council said. The 2014 budget will be “prepared to accommodate either annual or biennial assemblies,” so the General Assembly can decide whether to meet each year or every other year in the future.
It noted technology could be used in “gathering information and handling governance” and some changes would have to be made to current processes “to ensure timely responses.”
The church considered moving to biennial assemblies two years ago. In its report to the 2010 General Assembly, the Council suggested “there has not been sufficient support for the proposed pattern of biennial assemblies, particularly from presbyteries, to proceed with the proposal.”
College Grants
Instead of calculating grants to the three theological colleges based on the national church’s revenue each year, the 2014 budget is expected to set a fixed dollar amount. The grants will be reviewed in consultation with the colleges periodically and “will help the colleges prepare their budgets based on a fixed amount which guarantees stable funding to insulate them from wide fluctuations in the national church’s revenue stream,” the Council said.
Following the discussions of the 2014 budget—which occurred without media present—the Council approved an additional motion: “That the finance committee in consultation with the colleges explore whether or not it is good stewardship of our resources and financially astute to support three theological colleges.”
“I think it is time for the church to consider whether it needs three colleges or two colleges or one college,” said Rev. Dr. John Vissers, General Assembly moderator and principal of Presbyterian College, Montreal. “My vision for the church is for one first class theological college.”
Vissers will begin work as director of academic programs at Knox College, Toronto, on Jan 1.
“I don’t think a decision of this magnitude affecting the future of this church should be made solely for financial reasons,” said Rev. Dr. Stephen Farris, dean of St. Andrew’s Hall, Vancouver. He suggested the finance committee should “do some of the spade work” with the colleges and report to a future General Assembly. “I would see this as a preliminary motion to establish some of the basic facts, to lead to a wider process to be established by the General Assembly.”
Additional Principles
- A budget sub-committee is to be charged with a review of all national office departments and responsibilities, and should prioritize “providing support as close to the congregational and then presbytery level as possible.”
- A task group is to review all standing committees, boards and agencies of the church with an eye to reducing the number of groups and decreasing the number of members “while maintaining diverse representation.”
- The Life and Mission Agency is to continue to provide grants to each synod to be used for regional staff salaries or regional programming. If the available funds fall below $488,000, the current formula will be abandoned and the funds will be divided equally among the synods.
- Consultations are to be be held with the Women’s Missionary Society and the Atlantic Missionary Society to discuss their ongoing support.
- Current policies on minimum stipends for ministers and staff and cost of living adjustments are not to be changed.
- The finance committee is to review the policy for undesignated bequests left to the church.
