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If the Vatican Has so Much Money, Why Doesn’t It…? 7 Things To Know About the Finances of the Church
Sebastian Campos for Catholic Link
Like every good Catholic, surely you have had to explain the Pope, the Virginity of Mary, priestly celibacy, and refute the nonsense that appears in tabloids and on TV – which includes everything from claiming Jesus had children to conspiracy theories about the worldly power of the Church. Within those piles of rubbish, there is always someone who asserts authoritatively, “The Vatican is the richest institution in existence, if it would sell everything it has, it could eliminate poverty in the world.”Does the Vatican have more economic power than global giants like Walmart, Apple, and Coke? Fortune magazine, which specializes in economics, has published an article in which it refutes the notion of the “Vatican’s great wealth”. In fact, it verified that the Vatican would not even be among the 500 most wealthy on its famous “Fortune 500”.For your spiritual peace of mind, and so that you can share the information with others, here are some facts which will serve you well if you need to explain the finances of the Vatican and the Church.
1. The most valuable assets of the Vatican are invaluable and are not for sale.
To summarize: The Vatican’s possessions are treasures of humanity. They are as priceless as the first love letter you received from your spouse. Immensely valuable to us (and perhaps to some eccentric collector), but they cannot be sold. In its museums, the Vatican has some of the greatest artistic treasures of the world, accumulated throughout 2000 years of Christian history, not to mention the pre-Christian artifacts also found in its museums. Though they are treasures, they cannot be sold.
In the year 2015, Pope Francis was asked, “Do you ever feel any pressure to sell the treasures of the Church?”. His response was clear, “This is an easy question. They are not the treasures of the Church; they are the treasures of humanity.”
As an example: when John Paul II made his first visit to Brazil, he broke protocol after a ceremony, went to a favela, and visited a family. Moved by the encounter, he left them his Papal ring. Do you think that family sold it for its weight in gold to buy food and clothing? No. It’s a treasure, which they still keep it in the chapel of the favela. The poor are poor, but not stupid.
2. The new administration of Francis
We are not saying that other Popes have been poor administrators, but it is true that there were irregularities in some pontificates which, far from generating wealth, put the Vatican in debt. For this reason, Pope Francis instituted a new policy of the administration to alleviate some of this operational deficit.
The austere lifestyle of Pope Francis is not just rhetoric; it has permeated the pocketbook of the Vatican and the way the finances are managed from month to month. For him, financial management is a pillar of his mission to help the poor and disadvantaged. Pope Francis has said that he wants a more agile Vatican administration, more efficient and “self-sustaining”. This would free up more money for its charitable works.“The Holy Father’s message was crystal clear, ‘Let us make money to go to the poor.”, remembers Jose Zahra, member of COSEA, a pontifical commission in charge of the economical reorganization of the Vatican.Pope Francis is considered by Fortune magazine to be an “elite manager”. In 2013, under his leadership, the Vatican had a small surplus of 11.5 million dollars, demonstrating that even though some may believe that the Vatican is a global economic power, if it were a company it would not even make the Fortune 500.Despite the prudence of this administration, in 2013 the Holy See recorded an income of $315 million, with $348 million in expense, for a deficit of $33 million. So the surplus might cover some potholes, but nobody is swimming in gold.
3. The Vatican employees
vatican3© Alexey Gotovskiy / CNA
The Pope does not believe in firing current employees, but neither does he believe in waste and inefficiency. He believes that the Vatican would function better with fewer employees (assuming that they do their work well and do not retire early, which would result in long-term retirement costs).Almost two-thirds of the Vatican’s income goes to the salaries of its 2886 employees. The average employee, (including priests and religious), earns less than market salary, nearly 25% less than the wages of Italian workers in the private sector. However, despite having lower salaries, they aren’t required to pay income tax and they do have access to benefits such as health and retirement.
4. Diocesan Independence
Although the Vatican has subsidiaries all over the world, each of the approximately 2800 dioceses is a separate corporation, with its budget and assets, and they are administratively independent. This is documented by financial statements regularly published in each diocese. The Church is economically decentralized; in fact, economically, the Vatican is basically on its own.It is important to know that although the dioceses of the world send money to the Vatican each year, the vast majority of this money is destined to missionary activity or the charitable works supported by the Pope. However, this sum is less than 4.5% of the total income.The same applies to real estate. Even though the Church is present all over the world, the buildings and land do not belong to the Vatican. The dioceses and the 296 religious orders throughout the world are the proprietors of this real estate and administrate them on their own account.The Vatican also has properties, in fact, nearly 2000. Most are apartment buildings in Italy rented to people who work for the Church at a price that is significantly less than market value. That is to say, they aren’t making any money.
5. Some things are sold and the money is given to charity
The Pope receives mountains of gifts, from handcrafts to brand new vehicles, all given with tremendous affection. However, Pope Francis has preferred to use these gifts to finance his charitable works. An example of this was in 2014 when the American business “Harley-Davidson” gave him a motorcycle. Pope Francis never used it. He signed the fuel tank and donated it to Caritas, a Catholic association in Rome. It was auctioned off for $327,000, and the money was used to renovate a homeless shelter and soup kitchen.Having said this, it is clear that the Church – that is, the Cardinals in the Vatican but also you and I – must always seek to improve. We can always do more and each one of us must do our part. Whether you are a Cardinal, a sister, a parish priest, a businessman/businesswoman or a teenager, we are all invited to take a look around and discern what is truly essential and what is not. What prevails in our lives? Love of goods or love of our brothers and sisters? Why not put all that stuff gathering dust in the storage room to good use? Why not turn our goods into gifts for others?
6. Other costs and other income…
There are many administrative costs which do not generate any income, for example:The Vatican Radio, which has 330 employees and spends $37 million annually, but makes less that $1 million dollars in advertising.The Apostolic Nunciatures, which function as embassies in 113 countries, require more than $30 million dollars annually.Not to mention that the Vatican is a city and needs to generate income. The majority of this comes from tourists and pilgrims who visit the museums. This generates approximately $130 million annually. Another considerable portion of income comes from donations which approach $85 million per year.To finance its operations, the Vatican does like every responsible country and makes foreign investments. It possesses almost $920 million in actions, bonds, and gold. Its gold reserves, in the Federal Reserve of the U.S., amount to $50 million. The Vatican typically earns between $15 to $25 million from its investments. Although it invests money, it makes relatively little from which to pay its debts.A report on the finances of the Holy See can be seen here.
7. But, does the Church do anything to help the poor?
vatican7© Martha Calderon / CNA
Perhaps the most absurd argument is when people say, “The Vatican is flooded with wealth. If it would sell its assets that money could be given to the poor.” This statement insinuates that the Vatican does not help the poor and that the Pope surely gets up every morning to swim in a pool of gold coins surrounded by extraordinary luxury without ever concerning himself with the poor. This could not be further from the truth.In all of history, The Church is the institution which has done more than any other throughout the world to help the poor and the invalid, the sick and the orphaned. There is no other single institution which sustains as many hospitals, homeless shelters, care centers for the elderly, orphanages, schools, universities, etc.Let’s end on good note. “Fortune” magazine, when speaking about the administration of Pope Francis, points out that economic matters are truly important to Pope Francis. Although some may consider the Vatican to be among the wealthiest organizations in the world, it is not. However, with the money it does have, the Vatican significantly helps the world’s poor, sick, and oppressed.