The business of church

The following article by me has appeared in today's edition of the Methodist Recorder.

Many Methodists run a mile when we speak about the business side of church. Whatever our hopes and aspirations we cannot keep the doors open unless we balance our books.

A combination of falling and aging congregations, crumbling buildings, and rising costs are catching up with Methodism.. More time and energy will need to be spent understanding the business of each individual church.

According to Connexional news releases we have 265,000 members across 5,800 churches. In addition we claim that a total of 800,000 people are connected with the Church in some way. Just for a moment let us leave that additional 535,000 aside as there is no expectation that they should contribute to our core business

A mythical but typical Methodist Church – let’s call it Tat Bank Road Methodist Church – has a simple business model.

Tat Bank Road has 45 members (that’s 265,000 members divided by 5,800 churches). It is more than 50 years old and has a small rental income from the hire of rooms to a judo club.

It’s core business is to run a service of a Sunday morning, a monthly evening communion service, a Bible Study on a Monday and a Prayer Meeting on Wednesday.

To fund these activities Tat Bank Road’s annual outgoings can be summarized as follows:

Item	Cost
Assessment	9000
Insurance	1700
Gas and electricity	3000
Routine safety checks and boiler service	1000
Repairs and maintenance	5000
Other expenses	2300
Total	22000

The 45 members of Tat Bank Road may be surprised to learn that even before a light is turned on and the doors opened the church must find £37.70 per member in insurance alone.

They’d be astonished to hear that when the heating is on during the four or five winter months each service may cost as much as £100 in heating , however many people are present.

The reality is that the church needs an income of at least £22000 just to meet its core costs. Some corners can be cut: the false economy of not undertaking repairs and maintenance is probably the most widespread. But many costs are as fixed as any costs can be.

In theory the Treasurer of Tat Bank Road simply needs to remind the 45 members that each should contribute an average of £488 per year, just under a tenner a week.

The reality is very different. About a third of Tat Bank Road’s members will be on a small retirement income. They have given generously in the past, but cannot do so now.

Others are members on paper but only come occasionally. For them the collection is simply a matter of small change - £1 coin, possibly two or three.

It is to be hoped there are some newer and younger members. They have families to feed and haven’t given too much thought to the finances of the church. If they were asked for £10 a week, they’d run a mile.

And so it goes on until a large proportion of the membership are barely meeting the cost of insurance and heating.

Very quickly the 20/80 rule, so beloved in business, is established: 20% of the members fund 80% of the expenditure; 80% of the members contribute 20%.

That means, in order to stay afloat, 20% of Tat Bank Road’s membership needs to find 80% of its expenditure:

• 9 people need to contribute £17600 between them
• Each of those 9 need to give £1955 per year or £37+ per week
• The remaining 36 members need to give at least £122 per year, more than £2 each per week whether they attend or not.

There are ways of massaging income upwards with fundraising events and other special efforts. Gift Aid can be of considerable help, especially in raising the value of the contributions from the larger donors, but that still means a handful of members will need to provide about £1500 each per year.

The lesson is clear: in order for a church to continue funding its core activities its members must be prepared to fund it with real money. This must go beyond the casual tossing of a few coins into a collection plate.

There can be other models of church finance. Many rely on rental income from other congregations or various government or local authority schemes. As a short term measure these may provide a lifeline. However they leave the church vulnerable to changing government policies and other bodies making decisions for their benefit rather than for the church.

The reality is that in every church a handful of individuals have to accept their critical responsibility to make large donations. Unless that is understood many of our churches are unsustainable.

If we extrapolate from Tat Bank Road’s experience the core business of Methodism is being funded by just 53000 individuals. Who are these people? What is the motivation for this commitment? How old are they? How long will they be able to maintain this commitment? It doesn’t take a leap of imagination to realise that many of those 53000 people are probably office holders, local preachers and other church activists.

But the ideal solution does not rest on financial management. A church which steps outside of its doors to proclaim and live the gospel will attract people, especially the reputed 535000 people who the Connexion claims are “connected with the church in some way”. More people through the door will mean more money on the plate.

In the very near future practically every circuit in the Connexion is going to make some very hard and painful decisions. Church after church will come to the point where the critical 20% have evaporated, other sources of income has dried up and people are simply too old to hold positions.

We need to understand how the business of each church works, whether it is viable, whether it has the human resources to regenerate it self. Then we need to ask whether the capital assets would be better released for service elsewhere. The society can continue to meet in the halls of other churches, local schools, above pubs. Someone else can then have the worry of the roof.

However interesting it is to create different business models, the real answer is to seek the mind of Christ and ask for a quickening of the Holy Spirit. God has got a lot of money. Let’s be worthy of it.