The U.K. Government keeps a very close eye on what charities do with their money. The Bath & Wells Diocesan Board of Finance is a charity, and all parishes in the diocese are treated as charities, as far as their financial dealings go. So all members of P.C.C. (and of the D.B.F.) are Charity Trustees, and are required by law to exercise “due diligence” in that role.
The Charity Commission (which keeps track, on behalf of the Government, of what charities do with their money) gives this advice:
“A significant aspect of a trustee’s legal duties to protect charitable assets and to do so with care means carrying out proper due diligence on those individuals and organisations that give money to, receive money from or work closely with the charity. Where charities give money to partners and beneficiaries, especially large amounts of money or in high risk situations, making sure that adequate monitoring takes place is crucial. This means verifying that charity funds or property reach their proper destinations and are used as the charity intended.”
So we have to have some agreed ways of doing things, so that we can tell the Government and the Inland Revenue (the tax department of government) that we are obeying all the laws, and no money is going where it shouldn’t.
This business about ‘taxation laws’ isn’t all bad news! The Government wants us to use our money generously as well as legally, so it arranges for individuals to be able to reclaim money they have paid in income tax if they give money away to an acceptable cause.
So what are the “rules” – the protocol – we have to obey, and how will they work?
Essentially, we need to know what you need the money for, and you need to be able to prove that that’s exactly when you spend the money on. “We”, in Bath & Wells, means parishes: the money comes from parishes. Parishes in Bath & Wells are linked to parishes in Zambia, so money gets raised by parishes here and spent in parishes there. The diocese here in Bath & Wells is involved, because that’s HOW we get the money to you – from our Diocesan Board of Finance’s bank account to your diocese’s bank account. That’s why your diocese needs to be involved – your diocese needs to know HOW MUCH money is coming and WHY – WHAT it is to be used for and WHO gets it.
So the way that money transactions work is like this:
- A project, or a need, is found. We might say, “we’ve got some money, what do you need money for right now?” Or you might say, “We need money for this or that, can you help us?” But this sort of conversation can only take place where there is a good relationship and good communication before the subject of money comes up. Money is not the reason for our friendship: our common life in Christ, as St Paul puts it, is what binds us together in mission for the sake of the Kingdom of God and the growth of His church. So even when money is not being talked about, we need to keep our relationships good and keep communicating – and that means using lay people as well as priests (because we all know that priests move on to new ministry much more often than lay people).
- When a project or a need is agreed between the parishes, each parish tells its diocese what it is planning – in Zambia that generally means telling the Bishop and the Diocesan Finance Committee; in Bath & Wells that means telling the Executive Secretary for the Link (the World Mission Adviser). This is so that those who will be involved in actually moving the money know what is happening. Zambian bishops and the Executive Secretary are in frequent contact, so each side can check that the other side knows and is happy with what is proposed.
- From then on, all the various messages, instructions, pieces of paper, contracts, orders and invoices are shared all round between the parishes and the dioceses – conveniently by e-mail. That way the parish in Bath & Wells knows what is happening, and so do the Executive Secretary and the bishops on the Zambian side. And if anyone (tax authorities, government, banks etc.) needs us to prove that we are being honest, open and accountable, we have the paperwork to prove it.
- If the Zambian parish has a project which they hope their partner-parish will help to fund, they will (naturally) tell their partners all about it, including a clear indication of what it is going to cost. If the Bath & Wells parish is willing to pay for, or contribute towards, the cost of the project, they will tell their partners about that – how much they can pay and over what length of time. If everybody agrees that it should happen, the Bath & Wells parish will start sending money (via the diocese) and the Zambian parish will start work on the project (and tell its diocese). As the work goes on, the Zambian parish will keep the Bath & Wells parish fully informed about how the work is going – and if it isn’t going, what the problem is. Telling the whole story, keeping both sides fully informed, with photographs wherever possible, helps our relationships as well as making sure that we don’t break the law.
Download the full guide to How we handle the money for the Bath and Wells – Zambia link below.