VATICAN CITY (RNS) — After sweeping financial reforms and the economic challenges of the COVID-19 pandemic, the Vatican has reported a positive balance, even as it continues to struggle to maintain the operational costs of the Roman Curia.
In its 2023 budget statement, published on Monday (July 29), the Administration of the Patrimony of the Apostolic See — the centralized agency for managing the Vatican’s vast properties and investment portfolio since 2020 — registered 45.9 million euros (about $50 million) in earnings, a 13.6 million euro increase over 2022.
“These results were achieved with the understanding of having to constantly work toward an increase in the flow of income, to cover expenses without affecting the assets of the Holy See and without resorting to the sale of institutional properties,” said Archbishop Giordano Piccinotti, who became president of APSA in 2023.
The Holy See is considered to be among the largest real estate owners in the world, counting thousands of properties. But in recent years, the religious institution has struggled to show positive earnings, with many blaming poor financial management and a lack of transparency.
The COVID-19 pandemic hit the Vatican budget hard, as it largely relies on the income generated by the thousands of visitors who every day visit the Vatican Museums and St. Peter’s Basilica. Additionally, high-profile financial scandals, including controversial real estate investments, have contributed to the strain on the Vatican’s coffers.
According to a financial statement by the Vatican’s Council for the Economy, reported by the Italian daily La Repubblica, the Vatican’s annual operating deficit grew to 83 million euros in 2023, roughly 5 million more than the previous year. Despite efforts to rein in costs and increase revenues, Vatican observers foresee challenging years ahead for the Vatican finances.
Donations to the pope and the Holy See have also diminished because of the sex abuse scandals and a perceived lack of transparency into how donations are used. Offerings to Peter’s Pence, which are made every year on the Feast of Sts. Peter and Paul, totaled 52 million euros in 2023, an increase compared with money collected in 2022, but the charity still had to dip into its reserves to sustain the 109.4 million euros necessary for the pope’s initiatives and charitable works.
The donations in 2023 originated primarily from dioceses, rather than individuals, with the United States offering 28.1% of the total.
Pope Francis meets with members of Christian workers associations in the Paul VI Hall at the Vatican, June 1, 2024. (AP Photo/Andrew Medichini)
To sustain the imposing costs of Holy See operations, Pope Francis issued several decrees, including the decision to require “an extraordinary sacrifice” from senior curial officials by no longer subsidizing their accommodations. High-level clerics at the Vatican also suffered pay cuts even as they’ve said the workload has grown in recent years, the Catholic blog The Pillar reported.
To promote transparency, the pope overhauled the budgets for Vatican departments, setting a limit to their expenditures and transactions.
APSA reported a 2023 budget surplus of 27.6 million euros in financial assets by focusing on nonspeculative and low-risk investments that align with the Vatican’s values. It showed a significant increase compared with 2022, when APSA registered a loss of 6.7 million euros.
According to the statement by APSA, the Vatican oversees more than 5,000 properties, 92% of them in Rome, with others located in London, Paris, Geneva and Lausanne. Its real estate holdings generated a 35 million euro surplus, APSA reported, which the agency said was possible through new regulations on rent and better evaluations to determine the market value of its properties.
But the 2023 real estate surplus was considerably lower than the previous year, when it registered 52.2 million euros in profits. The financial statement explained that the higher figure in 2022 was due to an unusual return from properties in Switzerland.
APSA also stated that it paid taxes for the properties it owns on Italian territory and reported a 16.7 million euro loss for “other expenses,” which include papal visits to foreign countries.
The greatest expenses APSA reported were for managing the apostolic nunciatures — where papal representatives reside all over the globe — and the maintenance of the offices and departments that make up the Roman Curia.
In 2023, APSA contributed 37.93 million euros to the Curia, leaving a surplus of 7.93 million euros.
APSA’s net worth suffered a major contraction in 2023, losing 106 million euros compared with the previous year. The document explained that this was a result of the new real estate evaluation methods, including for nunciatures in foreign countries.
In the next three years, APSA hopes to further reduce costs and increase earnings, the statement read, especially through its consulting services and business activities. It also plans to continue restructuring its properties and develop better accounting methods. Following Pope Francis’ wishes, APSA is working to develop a renewable energy system that can sustain the entirety of the Vatican’s energy demands.
Pope Francis’ mandate to clean up the Vatican’s finances is well underway, but inflation and global conflicts continue to threaten the sustainability of the religious institution even as it attempts to move toward a green economy.