REPORT OF THE FINANCE COMMITTEE

1.  

   The Finance Committee has examined in detail the financial development of the Conference of European Churches since the Graz Assembly in 1997 as well as the current financial situation. To this end it was able to consult the From Graz to Trondheim Report, the 2002 accounts and balance sheet and also the lists of expected membership contributions and the contributions actually received from the churches. Both the accounts and the balance sheet have been audited by the Swiss financial advisors firm “Bourquin Frères et Béran SA”  and approved by the Central Committee. The Moderator of the Budget Committee and the Executive Secretary for Finance and Administration also gave a general view of how the finances have developed over the past six years.

2.  

   From a financial point of view this period was difficult for the Conference of European Churches. In 1997, the year of the last assembly, the accounts showed an accumulated deficit of 132,000CHF. At that time there was still hope that the deficit could be quickly reduced in order to allow for some limited financial flexibility, as at the Graz Assembly a considerable donation had been promised for the work of the Conference of European Churches..

3.  

   CEC did receive a small proportion of the promised sum in 1998, but it soon became clear that this would be the only payment to be received. Considerable difficulties were caused by this shortfall in income that CEC had firmly counted on receiving. Before the end of 1998, following proposals from the Budget Committee, the Central Committee decided on a plan to economise; as well as a number of individual measures it included cutting one (executive) staff position and half an administrative position. As these measures could not be effected immediately, there was an end of year deficit of 175,000CHF. In addition, the 2^nd European Ecumenical Assembly, which took place before the CEC Assembly, also produced a loss of 240,000CHF, of which CEC had to cover 80,000CHF, which meant that the total deficit at the beginning of 1999 amounted to around 395,000CHF.

4.  

   Severely restricted budgeting and spending marked subsequent years. Slight increases in contributions from a number of member churches and special donations made it possible to gradually reduce the deficit. However the yearly budgets were always noticeably less than the level of spending foreseen in the financial plan agreed by the Assembly. The 2002 accounts still show a 57,000CHF deficit, that should however – contingencies permitting have been cleared by the end of 2003.

5.  

   The Central Committee and the Budget Committee spent a considerable amount of time over the financial aspects of the integration of European Ecumenical Commission on Church and Society (EECCS). The Commission is shown in the general budget with its own lines of income and expenditure. In the meantime this presentation has proved to be the most appropriate.

6.  

   The Assembly’s recommendation to study the possibility of combining all the offices thereby reducing the number of locations was carried out. Relocation from Geneva to Brussels would, taking everything into consideration, cost approximately 1 million CHF. Set against this would be yearly savings of about 100,000CHF at that time. The Central Committee therefore decided not to proceed with relocation at the present time. The Finance Committee encourages the Central Committee to keep this issue on its agenda and to look into the question of the location of the offices once more in the not too distant future.

7.  

   It is the task of the Finance Committee of the Assembly to propose a financial plan for the coming Central Committee term of office for adoption by the plenary. This financial plan provides a framework to guide the Central Committee as it draws up the budgets for the following years. It includes all income and expenditure to cover the tasks and responsibilities of the Geneva, Brussels and Strasbourg offices. The financial plan for the years 2004-2009 is attached.

8.  

   What is not included in this financial plan are the projects and activities that the particular committees decide to implement. These are dealt with in each case by an extraordinary budget (for example donations, special contributions) drawn up by the Budget Committee and decided by the Central Committee. The requirement for such projects is that only those projects be implemented for which funds have been secured. It is not possible to do reliable longer term planning in this field. Moreover, the Assembly itself is also accounted for in a separate budget. If it is decided to hold a third European Ecumenical Assembly it must also be accounted for through an extraordinary budget. It will be extremely important to ensure that all costs can be covered by special contributions as no provision can be made in the ordinary budget for such an event.

9.  

   CEC’s income is mainly dependent on member churches paying their contributions. It is encouraging that income from these contributions has risen in recent years. Warm thanks are expressed to all churches which have contributed to this increase. Thanks are also due to those churches and organisations which have made considerable additional contributions to the core tasks and also given funds for special projects and events. However there remains a not inconsiderable number of member churches who do not meet their financial commitments, not even the minimum contribution of 1,000CHF (or the token minimum payment of 500CHF).

10.  

    The proposed financial plan has been prepared on the actual income of recent years. It is a limited financial plan precisely because not all member churches honour their financial obligations. Thus, it is not possible to bring staffing in Geneva, Brussels and Strasbourg up to levels which would correspond with the importance of CEC in a dramatically changed Europe.

11.  

    The 11^th Assembly in Graz set the goal that 75% of all expenses should be covered by member churches contributions. This goal has still not been achieved, as we have only managed to reach 65% in recent years. The goal set by the 11^th Assembly could be achieved if the churches which do not pay their contribution or pay much less than indicated in the key, were to increase their contributions to something approaching that level. It is in keeping with the spiritual nature of CEC as a fellowship of churches that the agreed rights and duties are observed by all member churches in accordance with the common basis and decisions. This also applies to agreed membership contributions which are calculated proportionately according to a key which takes into account the differing financial conditions and possibilities of member churches. If at some time a member church cannot meet its obligations for serious reasons then the spiritual fellowship of CEC proves itself by other member churches trying to take the situation of that member church into account. However this presupposes that the church concerned shows CEC that it is taking steps to guarantee fulfilling its obligations in the foreseeable future or that it transparently provides CEC with the reasons for its inability to pay.

12.  

    The Assembly document, “Priorities and Programme of CEC after the 12^th Assembly, results of an enquiry among the CEC membership” (A12/Doc.10e), states that the “smaller churches do not have the money to contribute to what CEC needs when it wants to do the things all the things on the programme now: should not CEC adapt its programme to the financial possibilities? Here CEC has to find ways to live in real internal solidarity”. A position needs to be concerning this statement which needs some clarification. 15 member churches give well over 80% of the total contributions received. Many churches pay only a minimum contribution or make a minimum payment of 500CHF. For this they receive travel subsidies as necessary, when taking part in CEC meetings. Specifically concerning financial matters, solidarity between member churches is actually very high.

13.  

    In the course of any one Central Committee term of office member churches have the basic duty to pay an extra year’s contribution in order to finance the Assembly. In the past some churches have spread this amount over their annual contributions. This procedure has the advantage that a considerable extra sum of money does not have to be found in any one year. We recommend this practice to all churches. As a result of this the financial plan provides for regular allocations to an Assembly reserve.

14.  

    It is important that the offices continue to make every effort, to improve communication with member churches and to improve information policy by using modern means of communication. This can serve to encourage willingness to pay contributions.

15. Some explanations concerning the 2004-2009 financial plan:

-Whereas accounting in Switzerland is in Swiss francs, the plan has been drawn up in Euros, since accounts will be in Euros in countries such as Belgium, Germany and France.

-It provides for an annual budget of more or less 1.9 million euros, the greatest variations being in the years 2004-2006 because of the three-year Mission Project and the planned renewal of computers in 2005.

-Calculations of staffing costs in Geneva are based on the fact that older staff will be leaving and younger staff will be employed at lower starting salaries.

16.  

    The Finance Committee proposes the following resolutions to the Assembly:

-To adopt as presented the financial plan for the years 2004-2009.

-The Assembly again reminds all churches that they have undertaken to pay an annual contribution, based on the key decided by the Central Committee, of at least 1,000CHF. Additionally, a further annual contribution is to be paid during the Central Committee term of office in order to finance the Assembly.

-The Assembly authorises the Central Committee to have further official conversations with those member churches indicated in point 10.

-The Assembly expresses its thanks to the General Secretary Dr. Keith Clements and Finance Secretaries Hans Schmocker and Jean-Daniel Birmelé for their sensitive and responsible financial stewardship.