In a special investigation by The Age, Melbourne’s major paper, it has been revealed that the value of the Catholic Church’s wealth in Australia is at least $30 billion, and raises serious questions about compensation payments to victims of child sex abuse.
The Catholic Church has tried to minimize its wealth by undervaluing its assets and saying that it would have to cut back on social programs (many of which are government funded) if it has to pay large payouts to victims of sex abuse.
The Catholic Church in Victoria is worth more than $9 billion, making it the biggest non-government property owner in the state and much wealthier than it has admitted in evidence to major official inquiries into its child sexual abuse.
The church testified before the royal commission that the amount of its assets in trust were only 109 million, and this, despite it owning hundreds of schools, churches and other assets. In fact, The Age investigation has found the archdiocese owns about $115 million in property in the working-class, south-east suburban Melbourne municipality of Greater Dandenong alone. And the fine print of the report reveals the properties disclosed to the royal commission were valued at “historical cost,” that is, the amount paid for properties when they were originally acquired, often in the 1800s or early 1900s.
Many were government land grants, and therefore, their historical value would be zero. But their actual, current market value would have soared. The fine print discloses other investments in shares, convertible notes and what appears to be commercial property of $72.9 million.
The six-month investigation has found that the church misled the Royal Commission into Institutional Responses to Child Sexual Abuse by grossly undervaluing its property portfolio. Figures extrapolated from a huge volume of Victorian council valuation data show the church has more than $30 billion in property and other assets, Australia-wide.
Based on these figures, the church is clearly the largest non-government property owner, by value, in the state, and close to the largest in Australia, rivalling giant Westfield, with its vast network of shopping centers and other assets, making it in the top five property owners in Australia.
The church also has extensive non-property assets including Catholic Church Insurance and its own internal banks – often known as Catholic Development Funds – which have total assets of several billion dollars, including more than $1 billion in Melbourne. Plus it has other investments, including in superannuation and telecommunications. A church-owned fund manager has more than $1.4 billion under management.
Asked specifically to nominate a value for the assets of the church and its associated entities, Melbourne archdiocese communications director Shane Healy said such information was “not available.”
The undervaluations raise serious new questions about the church’s decades-long bid to avoid or minimize compensation payments to abuse survivors. The royal commission reported that payments averaged just $35,000 under the Melbourne Response, the compensation scheme established by the then archbishop George Pell in 1996, a total of $11.3 million to 324 survivors of child sexual abuse.
In contrast the Melbourne archdiocese paid $39 million in 2015, more than three times the total compensation amount, for new premium offices, the heritage-listed Industry House in East Melbourne, near St Patrick’s Cathedral.
“These figures confirm what we have known; there is huge inequity between the Catholic Church’s wealth and their responses to survivors,” said Helen Last, chief executive of the In Good Faith Foundation, which supports abuse survivors. “The 600 survivors registered for our foundation’s services continue to experience minimal compensation and lack of comprehensive care in relation to their church abuses. They say their needs are the lowest of church priorities.”
Healy said the church’s meeting the claims of survivors whose complaints of abuse were upheld was “amongst its highest priorities.” He said that since that report the church had paid an extra $17.2 million to survivors.
The Age’s investigation also calls into question the privileges the church enjoys, including exemptions from nearly all forms of taxation and billions of dollars in government funding each year to run services – $7.9 billion for its Australian schools alone in 2015. The investigation involved obtaining property valuations from 36 Victorian councils, many under freedom of information act requests. It identified more than 1860 church-owned properties with “capital improved value” (land plus buildings) of just under $7 billion. The Age has used the property and other financial data to extrapolate to wider Victoria, and nationally, arriving at a conservative estimate of more than $9 billion in Catholic Church-owned wealth for the state, and more than $30 billion across Australia.
The church is notoriously secretive about, and protective of, its wealth. Church leaders have repeatedly publicly underestimated church assets and resisted greater financial accountability and stonewalled requests for information.
“The value of the church’s assets is a question that remains unanswered,” said Liberal MP Georgie Crozier, who chaired the parliamentary committee. “It is a question I would still like answered.”
“It appears,” Ms. Crozier told Cardinal George Pell in 2013 in his appearance before the inquiry, “that the leadership within the Catholic Church has been misdirected and geared towards the protection of the church and its assets.” Asked about the value of church assets Pell obfuscated: “One, I do not know. Secondly, it would depend a bit how you define them — you know, what value is there in a church building?”
In spite of the low valuations at “Historic costs,” the church insures its assets at current commercial terms. In addition, while Catholic Church often presents itself as a single institution, its finances are complicated by an ancient, disaggregated structure that has allowed church leaders to sidestep questions about overall wealth, and made it notoriously difficult for abuse survivors to identify a defendant to sue for damages.
“And the merchants of the earth shall weep and mourn over her; for no man buyeth their merchandise any more: The merchandise of gold, and silver, and precious stones, and of pearls, and fine linen, and purple, and silk, and scarlet, and all thyine wood, and all manner vessels of ivory, and all manner vessels of most precious wood, and of brass, and iron, and marble, And cinnamon, and odours, and ointments, and frankincense, and wine, and oil, and fine flour, and wheat, and beasts, and sheep, and horses, and chariots, and slaves, and souls of men. And the fruits that thy soul lusted after are departed from thee, and all things which were dainty and goodly are departed from thee, and thou shalt find them no more at all. The merchants of these things, which were made rich by her, shall stand afar off for the fear of her torment, weeping and wailing…” Revelation 18:11-15.