This budget flows directly from feedback that Council has received from General Assembly, from the people who attended Focus on the Future and from various other conversations. This is a balanced budget – income and expenditure are equal.
General Assembly 2004 was clear in its call for a budget in which expenditure didn’t exceed available income, and this is what Council and the Administration and Finance Policy Group has delivered.
Compared with the 2004/05 forecast, expenditure has reduced by $1.05 million across a range of areas including staff costs, grants and governance. This was needed to balance the budget. On the income side, there will be an inflation-based increase of 2.8 percent to Assembly Assessment. The need for fiscal prudence underpinned Council’s approach to the budget, and these decisions weren’t made lightly. Changes to income and spending reflect the financial reality we’re facing and are natural consequences of the Church’s call for a balanced budget. This budget starts building a sustainable platform for the future.
Applicable information regarding the Assembly Assessment element of the budget has been posted to presbyteries, union district councils and parishes.
Questions and comments about the budget can be directed to Administration and Finance Policy Group Co-convener John Trainor.
On behalf of Council of Assembly and Administration & Finance Policy Group (29 June)
Kerry Stotter, Council of Assembly Convener
Helen Bichan, Council of Assembly Deputy Convener
John Trainor, Admin & Finance Co-Convener
Major differences in the 2005/06 budget year compared with 2004/05 forecast
- This is a balanced budget – income and expenditure are equal
- Operating expenditure has reduced by $1.05 million
- Disestablishment of the regional mission resource team positions in 2004/05
- Nil General Assembly meeting-related income or expenditure is planned
- Overall spending on grants has been reduced, including a decrease in the grant to Te Aka Puaho, and the Interchurch Hospital Chaplaincy’s grant has ceased
- Global mission is to be funded solely from trust income
- Inflation-related 2.8 percent increase to Assembly Assessment.
Other points to note:
- Any financial impact associated with the possible sale of Laughton House has not been considered as part of this budget.
- Council of World Mission income and expenditure accounting treatment will be changed: in 2005/06 recognition of income and expenditure will be matched as the expenditure occurs.
- The 2005/06 budget foreshadows some of the decisions resulting from the Council’s Focus on the Future conversations with the wider church. More information about Focus on the Future will be with those who attended meetings or made submissions and parishes and presbyteries around 6 July 2005 .
Comparison of 2005/06 budget with forecast of the 2004/05 financial year outcome
Set out below is a comparison of the 2005/06 budget with the most recent forecast of the projected results for the year ending 30 June 2005 . For 2004/05, there was an approved budget deficit of $660,000 before depreciation on buildings and Council for World Mission-related transactions.
The figures for 2004/05 are provisional, and are based on the projected result for the year ending 30 June 2005 (as prepared at the end of May 2005). These 2004/05 figures are included here to allow people to compare, and as they are provisional are subject to change when the accounts for 2005/06 are finalised.
| $’000 | Forecast 2004/05 | Budget 2005/06 | Change* |
| Income | |||
| Assembly Assessment | 4,156 | 4,292 | |
| Less underpayment AA | -456 | -532 | |
| Net Assembly Assessment | 3,700 | 3,760 | |
| Trusts, admin, rent & sundry | 2,125 | 1,686 | -439 |
| Cooperative Ventures levy | 326 | 320 | |
| Sub total | 6,151 | 5,766 | -385 |
| CWM | 123 | 200 | |
| Total Income | 6,274 | 5,966 | -308 |
| Expenditure | |||
| Staff | 2,182 | 1,793 | -389 |
| Ben. Fund & Seniority Allow. | 1,414 | 1,378 | |
| Travel | 308 | 268 | |
| Property | 470 | 392 | |
| Computer | 200 | 181 | |
| Communications | 305 | 368 | |
| Grants | 837 | 400 | -437 |
| Other | 1,103 | 986 | -117 |
| Sub total | 6,819 | 5,766 | -1,053 |
| Other Expenditure | |||
| CWM | 545 | 200 | |
| Total Expenditure | 7,364 | 5,966 | -1,398 |
| Net Deficit / (Surplus) | 1,090 | 0 |
To enable better understanding of how and where funds will be spent in 2005/06, the budget figures in the shaded column above (for year ending 30 June 2006 ) are presented in a different format on page four.
Explanatory information regarding key changes between 2004/05 and 2005/06 budget is noted below:
Income
Assembly Assessment
- The need to deliver a balanced budget was a key driver in Council’s decision to increase Assembly Assessment by the rate of inflation. The 2.8 percent increase will generate an additional $120,000.
- Two other factors influenced the level of Assembly Assessment: (i) a decline in membership of 4 percent to 30,164 and (ii) a 4 percent increase in income subject to assessment.
- Provision for underpayment of Assembly Assessment is $532,000, which is $75,000 higher than budgeted for 2004/05. While the underpayment has been reducing, this provision is based on the information that is currently available regarding payment rates.
- The table below details shows a comparison between 2004/05 and 2005/06.
| $’000 | Parish Statistics 2004/05 | 2004/5 | $’000 | Parish Statistics 2005/06 | 2005/6 | |
| Assembly Assessment | $4,172 | $4,292 | ||||
| Membership Rate 50% | $2,086 | 31,493 | $66.25 | 2146 | 30,164 | $71.14 |
| Income Rate 50% | $2,086 | $28.77m | 7.25% | 2146 | $29.99m | 7.16% |
Trusts, admin, rent and sundry income
- The income reduction in this area relates primarily to several one-off items which are included in 2004/05 accounts but not in the 2005/06 budget: zero General Assembly meeting-related income, appeal income (as at mid-June approximately $95,000) and beneficiary fund administration income.
Expenditure
Staff
- The $389,000 reduction in staff costs in the 2005/06 budget is largely due to the disestablishment of the regional mission resource team positions. The ecumenical relations secretary position was also disestablished during 2004/05.
- In line with actions signaled in 2004/05, planned reductions in the number of staff at School of Ministry (two positions) are reflected in the 2005/06 budget.
- The Global Mission office is now funded solely from donations and trust income.
Grants
Te Aka Puaho
- The grant to Te Aka Puaho has been significantly reduced in 2005/06. This grant recognises our bi-cultural partnership, and has in recent times been at 11 percent of expenditure (2004/05: $329,000). For 2005/06, the amount is $100,000.
- Te Aka Puaho uses the funds from General Assembly’s gift of partnership to fund its Ministers of Word and Sacrament; the Moderator and clerk; to support amorangi; and to finance mission and gatherings.
- In making the decision to reduce funding for 2005/06, Council noted that a covenant exists between Te Aka Puaho and General Assembly, and that the reduction in funding for 2005/06 did not set a precedent for funding in future years. Council and Te Aka Puaho are discussing together the covenant relationship, including consideration of models of funding.
Inter-Church Hospital Chaplaincy
- Consistent with the intentions that were signaled at General Assembly 2004, Presbyterian Church (national) funding to the Inter-Church Hospital Chaplaincy has been discontinued.
Other
Council of Assembly and Policy Groups
- Expenditure for the Council and its policy groups has been reduced to foreshadow decisions relating to Focus on the Future. Detailed information about Focus on the Future outcomes will be issued around 6 July.
General Assembly - Budget 2005/06
Expenditure and Income
- The General Assembly 2005/06 budget (as shown on page two) is presented over the page in a format that clearly identifies the areas in which funds will be spent. The explanatory details noted below should be read in conjunction with General Assembly Budget 2005/06 Income and Expenditure information on page four of this document.
Administration
- The income is from advertising, service for insurance, Presbyterian Investment Fund and rent from Laughton House.
- Central Administration includes depreciation on assets and information technology costs.
- Human Resources includes employment-related legal costs, compliance training and advice costs, and support staff. Previously, comparable costs were recorded in other cost centres.
Assembly Executive Secretary
- Included in this area are expenses such as administrative support and costs associated with legal and judicial processes.
Global Mission
- The Global Mission Office has historically received funding from General Assembly, trust income and donations. Effective from 2005/06, the Global Mission Office is funded solely from Trust income and donations.
Equipping the leadership
- Income is from the Synod of Otago and Southland.
General Assembly - Budget 2005/06
| Expenditure | Income | Net | ||
| $000 | $000 | $000 | ||
| Governance | CoA | 24 | 24 | |
| Moderator | 67 | 67 | ||
| Te Aka Puaho | 100 | 100 | ||
| Book of Order rewrite | 20 | 20 | ||
| Policy Groups | 30 | 30 | ||
| Assembly Work Groups | 22 | 22 | ||
| 263 | 263 | |||
| Administration | Archives | 114 | 114 | |
| Assembly Executive Secretary | 259 | 259 | ||
| Finance | 582 | -320 | 262 | |
| Central Administration | 511 | -230 | 281 | |
| Communications | 304 | -100 | 204 | |
| Human Resources | 206 | 206 | ||
| 1976 | -650 | 1,326 | ||
| ReforM | National Mission Enabler & team | 364 | -63 | 301 |
| Grants | 76 | 76 | ||
| PI Synod | 67 | 67 | ||
| 507 | -63 | 444 | ||
| EtheL | School of Ministry & assessment | 928 | -319 | 609 |
| Lay Ministry | 92 | -92 | 0 | |
| SoM houses | 117 | -132 | -15 | |
| 1137 | -543 | 594 | ||
| Global Mission | 200 | -200 | 0 | |
| Connecting with Society | 39 | 39 | ||
| Operational sub total | 4,122 | -1,456 | 2,666 | |
| Beneficiary Fund | 1,064 | 1,064 | ||
| Seniority Allowance | 350 | 350 | ||
| CWM | 200 | 200 | ||
| Cooperative Ventures Seniority Allowance | 50 | -50 | 0 | |
| Presbyterian Foundation | 180 | -180 | 0 | |
| Assembly Assessment | -4,292 | -4,292 | ||
| Underpayment Assembly Assessment | 532 | 532 | ||
| Cooperative Ventures | -320 | -320 | ||
| Other sub total | 1,844 | -4,510 | -2,666 | |
| Total | 5,966 | -5,966 | 0 |
Note: There have been changes in how, historically, some items have been accounted for.