THE Pensions Board is preparing proposals for a replacement of the Church’s Housing Assistance for the Retired Ministry (CHARM) schemes, after its chair warned that a “perfect storm” had rendered it unsustainable.
Earlier this year, the Archbishops’ Council had to provide emergency funding of £9 million to maintain the scheme, a Church House spokesman confirmed this week.
The schemes, which came into effect in 1983, offer retired clergy without the means to buy their own property the opportunity to rent one from the Board. It currently houses 1800 households, equating to 2700 residents in total.
In response to written questions at the General Synod in July, Clive Mather, who chairs the Pensions Board, said that the Board was “committed to providing housing support for retired clergy who need it. Specifically, we will offer retirement housing to new retirees for as long as the Church is willing to fund it.”
But he warned that, “with costs having risen dramatically through inflation and interest rates, the current rental offer has only been maintained by emergency additional funding. It is hard to imagine the Church could support the likely funding needed in perpetuity.” The Board would be “bringing forward ideas as to how all our housing services might best evolve to meet the needs of future generations, provide more choice, and be financially sustainable”.
This week, a Church House spokesman said that the Board was “working on specific ideas to do this”. These would be presented to the Church, including the Synod, “in the coming months for discussion, consideration, and feedback. This will inform future services and decisions about resource allocation for the Church.” He emphasised that “none of what is being considered involves any change for existing residents. . .
“The Board continues to offer housing through its retirement rental properties and community living schemes, as well as supporting clergy to consider wider choices available through other providers where that best suits their retirement plans.”
Among the challenges facing the scheme is rising demand. In July, a spokesperson for the Board said that demand for help from newly retired people was at “almost unprecedented levels for 2023 and the following years, driven by an increase in retirements, and the knock-on impacts of the pandemic, which saw some clergy delay retirements or bring them forward” (Features, 28 July). In 2015, it was estimated that about 40 per cent of serving clergy were due to retire in the next decade (News, 12 January 2015).
In July, Mr Mather acknowledged the challenge of purchasing properties in a “slowing property market”, and the “severe” impact of inflation rates and interest rates. Until 2010, funding for the Pensions Board’s retirement housing was loaned from the Church Commissioners. When that arrangement changed, the Board had to borrow the funds on commercial terms from other lenders to buy properties. Currently, 75 per cent of the income that the Board secures from rents goes on servicing debt. Mr Mather told the Synod that it had only been able to maintain its current rental offer thanks to emergency additional funding from the Archbishops’ Council earlier this year.
The CHARM scheme is subsidised by the wider Church of England through Vote 5 of the Archbishops’ Council’s budget. In 2022, the Council agreed that the grant should increase by five per cent a year in 2023 to 2025 (it was £5.8 million this year). But the Council acknowledged in its 2023 budget that inflation had been “much higher than expected”, and that, in combination with higher interest rates, this had put a “significant strain” on CHARM.
In February, tenants of properties in the CHARM scheme were told that their rents would rise by 10.1 per cent from April: a rise lower than inflation at the time, but higher than the seven-per-cent cap placed on rent rises in the social-housing sector (News, 10 March).
The Pensions Board has already “paused” the option for shared ownership. Under the scheme, introduced in 2008, retired clergy and other eligible people were able to purchase a share (at least 25 per cent) in a property bought by the Board, paying rent to the Board in relation to the proportion of the property they did not own.
This week, a spokesman said that the Board had reviewed the option last year, “as interest from new applicants for the scheme had fallen markedly in recent years to single figures”. The market for shared ownership had “evolved significantly . . . with new, better options now available to retirees, including the Government’s Older Persons Shared Ownership scheme”. He confirmed that existing shared owners were unaffected.
He continued: “In the mean time, the Board is continuing to encourage any clergy retiring in the coming years, who might need help with retirement housing, to get in touch. The Board continues to offer housing through its retirement rental properties and community living schemes, as well as supporting clergy to consider wider choices available through other providers where that best suits their retirement plans.” The Board also offers its own charitable grant scheme, offering an additional monthly payment towards living costs for those on the lowest incomes.
On Wednesday, the Revd Eva McIntyre, who chairs CHARMERS, an independent fellowship of residents in CHARM houses and supported housing, said that tenants had been told that they would no longer be able to move to new CHARM housing in the future, but be signposted to “other providers”. Those looking to retire “appear to have been told that they cannot automatically expect a CHARM property, but that the Pensions Board will help them find somewhere”, she said. “This is not the promise of secure tenancy and capped rents we have been promised.”
She expressed concern about the Board’s reference to encouraging clergy to consider their retirement housing earlier in their ministry, “the inference being that this will somehow make it possible for them to afford to buy a house on a stipend in the current market”.
She suggested that the Church Commissioners reinvest in the Board’s property portfolio. “This would be a safe and ethical investment choice for the Commissioners, and remove the insurmountable challenges facing the Pensions Board, allowing them to focus on the promise made to clergy and their dependents that they will be housed during retirement.”
The Church House spokesman said: “When anyone needs to make a move in retirement, we work with them to find the best option for their circumstances, just as we do with newly retiring clergy. That often involves looking at options with other providers (including faith-based charities) who can often provide more suitable accommodation as needs change during retirement (e.g. in helping with reduced mobility), and to help make moves happen as quickly as possible, given there is really high demand for rental housing from retiring clergy.”
The consultation on possible replacements for CHARM will take place amid wider debate about the Church’s provision for retired clergy. The Pensions Board reports that about one sixth of the clergy do not have their own housing in place when they retire, and come to the board for help. Home ownership is falling in the UK, with younger generations far less likely to own their own home.
Meanwhile, the Church has sought to encourage younger vocations, setting a target in 2016 for half of ordinands to be aged under 32 (News, 23 September 2016): a contrast to preceding decades, in which it was common for clergy to first work in secular employment and acquire property.
There have also been changes to pension provision in recent years. In 2010, the General Synod approved an increase in pensionable age for future service from 65 to 68. For those who joined the scheme after 2011, the defined benefit is half rather than two-thirds of pensionable stipend. The number of years needed to contribute to the full pension has also increased, from 37 to 41.5 years.
‘We feel quite angry’
PAUL CARRThe Revd Paul CarrWHEN the Team Rector of Billericay and Little Burstead, the Revd Paul Carr, entered the selection process for ordination in 1991, he was told by his DDO in Chester that he would have to be debt-free to begin training, and that this would require selling his house.
“He said: ‘There is a good housing system at the end when you retire; so nothing to worry about at the time.’ We thought, it’s the C of E, we are going to trust their judgement. . . We were prepared to jump through whatever hoops necessary in order to be ordained.” The house on the Wirral, which he and his wife had owned for ten years, was sold for £57,000, and, once the mortgage had been paid off, they were left with £1500, which they used to buy a computer.
As a curate, he saw his vicar retire and secure housing through the Church’s shared-ownership scheme, which entailed going “50/50 on the mortgage and 50/50 on equity when the house was sold. . . It seemed like a good deal.”
Now aged 61, he has discovered that the Pensions Board is no longer offering shared ownership. He reports that the properties offered by CHARM in the south-east appear to be no less expensive than those available on the private market, although they would offer lifetime tenancy for him and his wife.
He has also learned that, after 26 years of service, his monthly pension would be £630 a month. The average monthly rent for a property is £1600. The lump sum provided will be used to clear debt incurred through years of ministry, and putting two children through university. “The irony is, they didn’t want us in debt in the first place, and I wouldn’t have been if I had had the house as income,” he says.
Early retirement, which he had considered, is out of the question: “I am staying on in ministry, and will just have to wait and see what I can accrue in pension to see if I can afford to retire.” He is the son of a disabled miner, and there is no family money to draw on.
“We feel quite angry about the way we have been treated by the C of E, but also by the money we have lost by the decisions that we were forced to make. But, on the other hand, I have got to say that it has been a real privilege to serve as a priest in the communities where I have. I have never doubted my call.”
‘The Church is not going to look after you’
DOUGIE BURNETTThe Revd Dougie BurnettTHE Revd Dougie Burnett, Minister of Redland Park URC, in Bristol, says that retirement provision for clergy transcends denominations. He was ordained at the age of 29, and now, aged 61, works across five churches to meet the Church’s ratio for deployment (140 members for every one minister).
He is supported in this by his wife, Helen, now aged 77. They currently own a small property worth £320,000 — not suitable for retirement by the Church’s own definition — and some savings, rendering them ineligible for the Church’s financial support for retirement housing, including shared ownership.
“You throw your lot in with the Church, assuming the Church is going to look after you, and then you discover the Church is not going to look after you,” he says.