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Finance Newsletter

Statistics Forms

Just a reminder that we still await statistics forms from many parishes. Now that General Assembly is over we will be contacting all those parishes who have not yet returned their forms. If you have not yet completed your forms please do so immediately and return them as required.

Amalgamated Investment Fund

The interest rate paid on deposits with the Amalgamated Investment Fund remains at 6.75% per annum.

Ministers Mortgages

The interest rate payable on Ministers' mortgages remains at 7.49% per annum.

Insurance Premiums

We received an excellent response to our offer of a prompt payment discount on material damages insurance premiums. At the end of September only a very small portion of the premium was unpaid. Those parishes meeting the payment deadline will have a credit showing on their statement at the end of September.

Premiums for the liability cover have been invoiced in September. Although no discount for prompt payment is offered we ask that these invoices be settled promptly as we have to pay the premium to the insurer. As is to be expected in a world of rising insurance premiums the premium has risen this year. As a percentage the increase is substantial though in dollar terms the increase is less than a dollar a week for most parishes.

Audit Confirmations

We have nearly completed answering parish queries arising from audit confirmations. Some adjustments will appear on September statements. This exercise has shown that while we are still far from perfect improvements have occurred in our record keeping. We are continuing our efforts to improve this area of our service.

Single Assessment

By now most Treasurers will have been advised that the General Assembly agreed in principle to adopt from 1 July 2003 a single compulsory assessment to fund the programmes of the Assembly Office. The single assessment would replace the national services levy, mission and ministry giving, Beneficiary Fund parish assessment and seniority allowance levy. The General Assembly made their approval subject to consultation with parishes and presbyteries.

It was evident (to me at least) that much of the concern expressed at General Assembly on the proposed single assessment related to the definition of income to be applied. A definition was included within the papers circulated to Commissioners and concern was expressed about how the definition would be applied in practice. Parish finances are becoming more complex with many parishes now receiving community and Government grants to operate community based services such as early childcare. Some of those services are operated out of charitable trusts. The definition of income tries to recognise this reality but unfortunately reads a bit like the Income Tax Act as we attempt to clearly define based on current principles what income is subject to assessment and what is exempt. In the definition we have also tried to ensure that amount of the assessment is determined by the amount of money raised not the manner in which the money is raised.

I will circulate shortly to parishes and presbyteries the reasons for and explanations of the various components of the definition of income together with examples of how they would be applied in every day situations faced by the parish. This information should form the basis of your parish consultation. A response to some specific questions will be required. Details of how the parish should make submissions will be included with the papers to be circulated.

Seniority Allowance

As we will be shortly invoicing parishes for Seniority Allowance Levy it is an appropriate next topic for my series on informing parishes. While the levy will disappear upon the adoption of a single assessment the Seniority Allowance will remain so a portion of the single assessment will be used to fund the payment of the Allowance.

The Assembly Office pays a Seniority Allowance to all qualifying ministers in March each year. The Allowance is funded from a special levy on parishes that is charged annually and based on the number of members in each congregation. When paying the Allowance to Ministers the Assembly Office deducts PAYE and returns this money to the IRD. The parish need only pay the invoiced charge to the Assembly Office.

The Seniority Allowance is calculated from the basic stipend. Ministers who have more than five years service receive an allowance of 2% of the basic stipend, ministers with more than 10 years service receive 4% of the basic stipend while ministers with more than 15 years of service receive 6% of the basic stipend. To qualify for a payment a minister has to be in a Presbyterian or Co-operating parish or an Assembly appointment and their requisite service needs to be in these roles and within New Zealand. The Allowance is an additional stipend amount that recognises the extra benefit the Church receives from experienced clergy. Qualifying service therefore needs to be gained in the relevant areas of church life.

Ministers in other roles, such as school chaplains, can receive the Seniority Allowance, provided the minister's employer contributes the cost of paying the allowance. In such situations the employer is recognising and paying for the benefit of an experienced minister and it is therefore appropriate that the employer determine the qualifying experience.

All parishes contribute to the cost of paying the Allowance regardless of whether they have a minister who receives the Allowance. Parishes without ministers pay the levy, as do co-operating ventures under Presbyterian oversight. The levy is currently funded by a levy of $9.80 per member on the roll. Membership figures are taken from the statistics returns provided by parishes. The levy rate is set by dividing the total cost of the Allowance by the number of members on the roll. A small allowance is included in the rate for parishes that will not pay the levy, usually due to financial hardship and for adjustments to roll numbers. No adjustment to roll numbers will be accepted without the consent of the presbytery to the adjustment.

As was done last year parishes and ministers will be advised in advance of either their roll number or entitlement prior to invoicing or payment. We ask that you check this information immediately as we use it to establish an appropriate levy rate.

Geoffrey Bell
Manager, Financial Services