Pope says Vatican's pension fund faces 'serious imbalance'

By Joshua McElwee

Pope Francis said on Thursday the Vatican's pension fund is facing a "serious imbalance" that may require changes to its operating structure, and appointed a senior cardinal to take over the fund's administration.

In an unusual letter sent to all the world's cardinals and to the leaders of the Vatican's various offices, the pope did not quantify the scope of the issue.

He said the changes would include "making difficult decisions that will require particular sensitivity, generosity, and willingness to sacrifice on the part of everyone".

Francis appointed Cardinal Kevin Farrell, an Irish-American prelate who has led the Vatican's office for family issues since 2016, to take over as the fund's administrator.

The pope has expressed uncommon concern about the Vatican's budget several times in recent months. In October, he ordered the third reduction in three years for the pay packages of the cardinals who lead the Vatican. He has also asked them to pursue a "zero deficit" agenda.

The Vatican has not released a full budget statement in several years but is known to be facing a serious budget deficit.

The Vatican's finance czar estimated in 2022 that the net liability of the pension fund for post-employment benefits amounted to some 631 million euros ($664 million).

The headquarters of the Catholic Church comprises two entities: the internationally recognised sovereign entity of the Holy See and the Vatican, a 108-acre city-state within Rome.

They maintain separate budgets, and Vatican City income, including from the popular Vatican Museums, has often been used to plug the Holy See's deficit, which according to Italian media stood at around 83 million euros ($87 million) last year.