Costs of litigation yield 2001 deficit

Published January 1, 2001

Mississauga, Ont.

The national church expects to continue grappling with financial difficulties in 2001 despite a year that saw staff layoffs and spending cuts in most areas.

Council of General Synod (CoGS) – the governing body that guides the church in the three-year period between general synods – approved a budget for 2001 that projects a deficit of $1 million, all due to the costs of litigation concerning Native residential schools.

Meeting in mid-November, the council heard from General Synod treasurer Jim Cullen that contributions from both dioceses and individuals are down. Much, but not all, of the decline is due to uncertainty about the survival of General Synod.

The national church and several dioceses are involved in hundreds of lawsuits brought by Natives who claim they were abused in the boarding school system run for decades by the government of Canada and managed by Christian churches.

Mr. Cullen also told the council that, on an operating basis, the budget for 2000 shows a surplus of $46,000, but when residential schools costs are factored in, it shows a deficit of $1.272 million, a bit higher than earlier estimates of $1.104 million. If residential schools costs proceed as expected, the church will face an accumulated deficit of $4.466 million by the end of the 2001 calendar year. “If it goes that way, $4.466 million will leave very little working capital,” said Mr. Cullen.

Total revenue is expected to drop to $15.484 million in 2001 from $16.751 million in 2000.

General Synod groups revenue into three categories: diocesan contributions, information resources (much of which is Anglican Book Centre sales) and other, which includes investment income and individual donations.

Diocesan contributions (the major source of revenue for General Synod) are projected to decline to $8.795 million in 2001 from $9.186 million in 2000. Although some dioceses are increasing their contribution for 2001, Niagara, Calgary, Rupert’s Land and Cariboo are all projecting a lower level of contributions than that budgeted for 2000.

Calgary and Cariboo’s problems relate to residential schools lawsuits, but financial difficulties in Niagara (previously reported in the Journal) and Rupert’s Land (see related story in this issue) relate to other sources.

The “other income” category is expected to slide to $1.391 million from $2.218 million, due to lower projected income from the Anglican Appeal, planned giving and investments. General Synod has been financing legal costs through the sale of investments, not operating funds, so investment income is expected to decline to $250,000 from $377,000.

Anglican Appeal income is expected to drop to $350,000 from $600,000 and planned giving to $106,000 from $521,200. “There is a lot of uncertainty in congregations (about the survival of the national church),” said Mr. Cullen in his presentation to the council.

General Synod draft budget summary
2001 2000
Diocesan contribution 8,795,000 9,186,000
Other income 1,390,675 2,217,600
Information Resources (gross) 5,298,000 5,347,500
Total 15,483,675 16,751,100
Program expenditures 1,860,500 2,035,095
Salaries and benefits 4,456,975 4,769,379
Information resources 4,038,250 4,259,500
Council of the North 2,504,000 2,761,000
Other 2,623,950 2,880,679
Total 15,483,675 16,705,653
Surplus/(Deficit) ? operations (0) 45,448
Residential schools ? net of recoveries 1,000,000 1,150,000
Total surplus/(Deficit) (1,000,000) (1,104,552)

Expenditures are budgeted at $15.484 million, not including the $1 million for residential schools costs. Some areas, such as Council of the North and eco-justice, were cut, but healing and reconciliation (aimed at helping those harmed by the school experience) received a significant increase to $311,000 from $111,000. Overall, expenditure on indigenous ministries is projected to rise to $499,000 from $214,100.

The council also heard that the projected cost of General Synod, scheduled to meet in Waterloo, Ont. in July 2001, is running over budget by $52,000. That’s mainly due to the cost of transporting delegates to and from Toronto’s Pearson International Airport, which is about 85 km from Waterloo, said synod planning committee chair Rev. Mark Gladding in a subsequent interview. CoGS directed the planning staff for General Synod to find some savings in order to bring the budget back to its original allocation of $450,000. Among the options considered were scaling back a national television broadcast of General Synod sessions. The council also heard a suggestion that more aboriginal people attend General Synod, but the financing for such a move was uncertain.

In a subsequent meeting, the General Synod planning committee decided to cut the $52,000 from the broadcasting budget in order to increase aboriginal participation. Current plans are to record the sessions of General Synod on video tape. A more expensive option that had been considered would have broadcast news reports from the sessions nationwide via the Vision cable channel.

Out of the 300 delegates scheduled to attend General Synod, about 20 are aboriginal and the planning committee would like to increase that number to about 70, so each discussion table will have two aboriginal representatives, Mr. Gladding said. But there was a strong sense on the committee that telling the church’s story at this time of crisis is vitally important, so other broadcasting options are being explored, such as attracting a sponsor and using local broadcast facilities, he added.

The council also accepted improvements to the pension plan of General Synod, which covers the national staff and clergy and lay employees in Canada, except for the diocese of Montreal. The pension plan currently shows a surplus of $47.746 million on total assets of $465.8 million, the council heard.

Assets of the pension plan belong to its members, not to General Synod.


  • Solange DeSantis

    Solange De Santis was a reporter for the Anglican Journal from 2000 to 2008.

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