The security of existing clergy pensions is not at issue as the value of the commissioners' assets comfortably exceeds the accrued pension liabilities for retired clergy and those currently in active service. Separate funding arrangements are in place to pay the pensions of lay employees in the Church of England.
The commissioners and the pensions board are discussing with dioceses proposals for funding pension liabilities arising from the future service of clergy on a more sustainable basis involving contributions. This will help to secure the commissioners' continuing ability to help the Church in other ways.
Is the right hon. Gentleman aware that there is a great deal of concern about the amount of Church Commissioners' assets that were lost due to unfortunate property speculations in the past few years? There is a danger that this will impact on the pension funds and therefore affect not just the ability to pay pensions in the near or foreseeable future but the ability to increase pensions at least in line with average earnings. Many clergy and staff of the Church are deeply concerned about this matter. Can the Minister assure them not only that pensions will continue to be paid at existing levels, but that they will be increased in the future?
Yes. The answer that I gave to the hon. Gentleman that the value of the commissioners' assets comfortably exceeds what is needed is based on our past performance. We have increased pensions at a substantially higher rate than the rate of inflation—indeed, at levels almost approaching earnings—and we hope to be able to do that using existing assets for the categories that I have described. It is precisely because we want to make certain that future pensions can be increased in a way that is desirable and for which there are precedents that we are moving to introduce a contributory base through the dioceses.
The hon. Gentleman referred to the loss of assets due to property speculation. In fact, the value of the portfolio is rapidly increasing again with the change in market values, and we have complete confidence that we shall be able to sustain the level of pensions.