The Vatican’s pension fund faces a “serious prospective imbalance” that will only get worse if an intervention is not staged, Pope Francis warned the College of Cardinals in a letter.
In an effort to deal with urgent structural measures necessary to make the pension fund sustainable, the Pope appointed Cardinal Kevin Farrell as sole administrator of the fund, according to a translation of the letter. Among his responsibilities, Farrell is president of the committee for investments.
In the letter to the College of Cardinals — made up of his advisers and collaborators — Pope Francis asked for support for a “new and inescapable path of change” to address challenges in the retirement system and to ensure the economic sustainability of the Catholic Church’s central governing body and Vatican City, known as the Holy See.
“Unfortunately, the figure that now emerges, at the conclusion of the latest in-depth analyses carried out by independent experts, indicates a serious prospective imbalance in the fund, the size of which tends to increase over time in the absence of intervention,” the Pope wrote, according to a translated version of the letter, posted on the website of the Holy See. “In real terms, this means that the current system is not able to guarantee in the medium term the fulfilment of the pension obligation for future generations.”
The decisions are "not easy ... (and) will require particular sensitivity, generosity and willingness to sacrifice on the part of all," he wrote. “We are now all fully aware that we need urgent structural measures, which can no longer be postponed, to achieve sustainability of the pension fund.”
The size of the Vatican pension fund and its liabilities was not disclosed. The 2019 actuarial valuation of the pension fund showed a €631.4 million ($665 million) net liability for the pension fund, according to an interview published on Vatican News with the then-prefect of the secretariat of the economy.
Pope Francis has recently called for changes to the Vatican’s budget, including that Cardinals renew their commitment to economic reform and achieving a net-zero goal.
Spokespeople for the Holy See could not immediately be reached for comment.
