## **The Church of England Pensions Board** 

## **Annual Report** 

**Year ended 31 December 2025 Registered charity no. 236627** 

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## Contents 

Introduction from the Chair and Chief Executive ............................................................................... 4 Report of the Trustees for the year ended 31 December 2025.......................................................... 6 Structure and history .......................................................................................................................... 6 Public Benefit ...................................................................................................................................... 7 Objectives ............................................................................................................................................ 7 Charitable activities of the Board........................................................................................................ 8 Housing ............................................................................................................................................... 9 Rental Property ............................................................................................................................... 9 Community Living ......................................................................................................................... 10 Shared Ownership ........................................................................................................................ 11 Mortgage Schemes ....................................................................................................................... 11 Signposting to alternative housing options .................................................................................. 11 Administration of pensions ............................................................................................................... 12 Review of 2025 activities .................................................................................................................. 12 Administration of Pensions ......................................................................................................... 14 The Board’s Approach to Investment & Stewardship ....................................................................... 16 Financial Review ................................................................................................................................ 19 External financing.............................................................................................................................. 20 Charity Investments .......................................................................................................................... 21 Risk Management ............................................................................................................................. 22 Principal Risks .............................................................................................................................. 23 Going Concern ................................................................................................................................... 25 Approach to Taxation ........................................................................................................................ 26 Reserves ............................................................................................................................................ 26 Unrestricted funds ............................................................................................................................ 26 Restricted funds ................................................................................................................................ 26 Reserves policy .................................................................................................................................. 27 Plans for the future ........................................................................................................................... 27 Structure, governance and management ......................................................................................... 28 Governance ....................................................................................................................................... 28 Independent Auditors ....................................................................................................................... 29 Ethical Investment Advice ................................................................................................................. 30 The Charity Code of Governance ...................................................................................................... 30 Trustees ............................................................................................................................................. 31 Attendance by Trustees at meeting of the Board and its Committee .............................................. 33 Reference and administrative information ....................................................................................... 34 

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Management ..................................................................................................................................... 35 Approval ............................................................................................................................................ 36 Statement of Trustees’ responsibilities in relation to the financial statements .............................. 36 Independent auditor’s report to the Church of England Pensions Board  ....................................... 37 Consolidated Statement of Financial Activities of the Church of England Pensions Board for the year ended 31 December 2025  ........................................................................................................ 44 Consolidated Balance Sheet of the Church of England Pensions Board as at 31 December 2025  .. 45 Charity only Balance Sheet of the Church of England Pensions Board as at 31 December 2025  .... 46 Consolidated Cash Flow Statement of the Church of England Pensions Board as at 31 December 2025 .................................................................................................................................................. 47 Notes to the Financial Statements of the Church of England Pensions Board as at 31 December 2025 .................................................................................................................................................. 48 

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## Introduction from the Chair and Chief Executive 

Welcome to this Annual Report of the Church of England Pensions Board’s activities in 2025.  In a fruitful year, investments returned 9.5%, the Board agreed new responsible investment priorities, which will shape our future investment activity, and agreed a funding package with the Church for the Board’s charitable activities which will support continued provision and improvement of retirement housing, and the implementation of a new package of financial wellbeing services. 

In July 2025, the General Synod agreed a substantial package of new benefits to improve clergy pensions. The Board was pleased to be able to provide the input to allow Synod to make this historic decision. It means that every clergy pension scheme member with any part of their pensionable service after 2011 will see an uplift to their pension.  In February 2026, General Synod agreed the specific changes to rules and legislation, so that the implementation can proceed. Completing this complex task, which involves thousands of calculations, is a major focus for 2026. 

These changes are only possible and affordable because the clergy pension scheme is in a strong financial position, following sustained investment returns over the past decade.  The Board’s other pension schemes also performed well during 2025, providing scope for pension bonuses for members where bonuses are part of the scheme design.  All of the defined benefit pension schemes of which the Board is Trustee were better than fully funded as at the year end, and no deficit recovery plans are due.  Over 72,000 pensions processes (individual work items from queries to data updates to retirements) were completed in 2025, with a substantial proportion being undertaken by members directly using our online portal. 

The Church of England was a pioneer of occupational pensions in the 1920s and still is.  In 2026, our centenary year, in addition to the pensions uplifts, the Board will launch a new suite of Financial Wellbeing services to assist clergy households with financial and retirement planning. This delivers on the ideas in Enabling Choice, so enthusiastically received across the Church. And now that the Government has published regulations for a new type of pension scheme, the Board will work up detailed plans for a new pension offer for Church employers and employees. 

The Board continues to provide Church retirement housing for stipendiary clergy.  In 2025 a new residential tenancy started every seven days on average.  We successfully transitioned to a new principal contractor for residential maintenance in April 2025, and secured funding from both the Church and the Warm Homes Scheme to support investment in energy efficiency and other property improvements from 2026. 

The Board launched a new website in 2025 as part of continued improvement in member and resident communications. 

In 2025, the Board was pleased to be part of shaping a comprehensive 10-year vision and recommendations for a responsible mining sector through the investor-led Mining 2030 programme.  The work has been widely welcomed, including by President Lula of Brazil. 

As we finalise this report, we note that the first part of 2026 has seen significant global events 

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particularly in the Middle East.  These are having effects on markets (which are also responding to prospects for artificial intelligence) and economic forecasts.  The Board continues to monitor these developments closely. 

Even at 100, the Board will still be younger than our oldest members and residents. Meanwhile, our youngest scheme members will still be drawing their pensions in the 2100s.  This is a humbling responsibility for the very long term, which is reflected in how the Board acts and invests, and how we engage with the inherent messiness of the world today. 

It remains a deep honour to support our members and residents in their service to the Church and in their retirement. 

Clive Mather Chair 

John Ball Chief Executive Officer 

**numbers** members of our votes cast at pension schemes meetings Nearing **198** retirement organisations planned in the **£3.5bn** of pension Around responsibly **14,995** self-service processes by members surveyed to improve energy efficiency 

out of 10 is the retirement moves Results are provisional and subject to audit 

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## Report of the Trustees for the year ended 31 December 2025 

The Trustees present their annual report and financial statements of the charity for the year ended 31 December 2025. The financial statements have been prepared in accordance with the accounting policies set out in note 1 to the financial statements and comply with the Charities Act 2011, FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” and “Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102)” (“the SORP”). 

## Structure and history 

The Church of England Pensions Board (“the Board”) was established in 1926 by the Church Assembly (now the General Synod) by the Clergy Pensions Measure 1926, to serve as the pensions authority for the Church of England and to administer a comprehensive pension scheme for clergy.  Prior to 1926 there was no proper pension system for clergy. 

The Board was given powers in 1948 to provide housing for retired clergy and their widows and dependants, and in subsequent years also became trustee of various charitable funds and trusts to provide for the relief of poverty of retired clergy and their widows and dependants.  In 1964 the Board became a registered charity.  Since then, the funds and trusts have been amalgamated and now exist as a single restricted fund: the ‘General Purposes Fund’; and one linked charity for which the Board is corporate Trustee: the ‘Clergy Retirement Housing Trust’. 

In its current form, the Board is a body corporate, a registered charity, and is governed by the Church of England Pensions Measure 2018 – the main operative provisions of which came into force on 1 March 2019 consolidating and replacing prior legislation.  The structure of the Board was amended in 2021 by the Legislative Reform (Church of England Pensions) Order 2021. During the period covered by these accounts it was the corporate Trustee of three pension schemes: 

- The Church of England Funded Pensions Scheme (“CEFPS”, commonly called ‘the clergy scheme’) 

- The Church Workers Pension Fund (“CWPF”) 

- The Church Administrators Pension Fund (“CAPF”) 

The financial statements of the three pension schemes listed above are not included in this report but are separately available on the Pensions Board’s website. 

The Board administers two other pension schemes, for which it is not a Trustee: the Church of England Pensions Scheme (for clergy service prior to 1 January 1998); and the Church Commissioners Superannuation Scheme (for staff service prior to 1 January 2000). The financial affairs of these schemes can be found in the Church Commissioners’ accounts. They have no impact on the financial position of the pension schemes of which the Board is Trustee. 

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## Public Benefit 

The purposes of the Board are the provision of retirement services set by the Church of England for those who have served or worked for the Church.  This is carried out primarily through the provision of retirement housing and the administration of pensions. 

In accordance with the requirements of s17(5) of the Charities Act 2011, in exercising their responsibilities the Board has had regard to the Charity Commission’s published advice on public benefit, especially that contained in its supplementary guidance _“The Advancement of Religion for the Public Benefit”_ . 

Nationally, the Church, through its network of more than 12,000 parishes, 16,000 churches and around 20,000 ordained and lay ministers seeks to build social capital and provide spiritual care for all those who might wish to engage with matters of faith in a Christian context.  The local churches are a focus for community activity, and through resources available at their disposal, provide activities that support community development and social cohesion.  These can include projects which support children, families, and the elderly. 

Retired clergy and their dependants often play a role in these projects, and retired clergy provide valuable auxiliary ministry in parishes across the Church of England.  Through the provision of comprehensive pension schemes, retirement accommodation and, where applicable, direct grants to supplement their income, the Board assists clergy in retirement to continue to play a full role in the community. 

## Objectives 

The Board’s charitable objectives are first, to provide the best possible support and care, within available resources, to those who have retired from stipendiary and lay ministry within the Church of England, and to their dependants, through the provision of retirement and supported housing, and through advice services, and discretionary grants for those most in need. Second, the Board’s objective is to meet its responsibilities as Trustee and administrator for the various pension schemes, as laid out in its governing documents (see Structure and History section). 

The strategic objectives of the Board are to: 

1. Manage the pension schemes efficiently and effectively. 

2. Offer charitable and housing services that our customers and funders value. 

3. Invest for the long term to deliver on our pension promises, be a leader in ethical and responsible investment, acting in members’ interests, and reflect the Church of England’s ethos and mission. 

4. Understand our customers to deliver excellent customer service. 

5. Model good governance and stewardship. 

6. Be a great place to work, where people are valued, engaged and performing well. 

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In December 2019 the Board agreed three strategic priorities to guide its work and the implementation of its objectives. These are: 

## **1. Simplification** 

**2. Self-sufficiency** in the long-term so that the pension schemes make less of a call on the Church’s resources, and to deliver charitable services agreed with the Church 

**3.** Engaging in **great conversations** with those the Board serves and the companies in which it invests 

These priorities together form the Board’s ‘Centenary Vision’. 

Retirement is a significant life event and particularly so for the Church of England clergy who have lived most of their working lives in tied accommodation, and for whom retirement also entails the stress of moving to a new house and new community. The Board aims to work with clergy to assist them in this significant life transition and encourages early conversations about their pension and retirement housing options. 

In 2025, through the Church of England’s triennium funding process, the Board was awarded grant funding for the period 2026-28 to both support the provision of retirement housing, and to develop new services to better assist clergy households with retirement planning.  This follows on from the conversation held over the winter of 2023-24 with the Church about new ways to support future cohorts of retiring clergy, particularly with their housing needs.  By providing greater support and access to products and services during stipendiary ministry, the Board anticipates that fewer clergy households will need Church-provided housing at retirement.  This represents a better offer for clergy and a long-term saving for the Church, while ensuring that a safety net remains for those who need it. 

The charitable activities are funded through grants from the wider Church, other grants, gifts and legacies, investment income and rent from retirement housing. 

All donations are placed in the General Purposes Fund unless otherwise specified.  The trustees are very grateful to those who have given donations and left legacies over the past year. 

## Charitable activities of the Board 

Around one in six clergy retiring from the stipendiary ministry seek the Board’s assistance with retirement accommodation, whether in the Board’s properties or through advice and signposting to other providers.  Survey data suggest that this proportion would increase over time, absent any other assistance. 

Around 2,300 individuals – primarily retired clergy and their spouses or partners – receive direct housing assistance from the Board.  The majority of these customers are residents in the Board’s rental and community living properties.  The Board also operates a small shared ownership scheme, and mortgage schemes, which are closed to new applicants.  Although the expression is used less now, these services continue to be referred as CHARM (Church’s Housing Assistance for Retired Ministry). 

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## Housing 

The Church of England Pensions Board’s retirement housing provision is designed to assist retiring clergy leaving tied accommodation and who have not been able to make their own provision for somewhere to live in retirement.  The provision of housing is a discretionary facility, with the Board specifying various parameters relating to the size and type of property available. These parameters are regularly reviewed and depend to large measure on the funding provided by the Church to support retirement housing. 

Information on the housing offers, eligibility and access to the various options is available on the Church of England website at www.cofepensionsboard.org. 

The Board also supports retirees and their households through a Welfare Advice Service which enables us to signpost individuals to other charities and agencies through which they can access the different types of support available to them, including helping individuals to navigate the state benefit system.  The Board operates a modest discretionary grant scheme to assist those on the lowest incomes. 

From 2026 the Board will be offering an expanded set of charitable financial wellbeing services to assist clergy households to better engage with their personal finances and plan for their retirement. 

## **Rental Property** 

The rental option is the Board’s core service, with 1,153 properties let across England and Wales as at the end of 2025 (2024: 1,168).  Eligible applicants can choose from a portfolio of available properties across the country and “reserve” it for their retirement. From April 2026, the reservation window will be reduced from five years to two years before retirement. This change is intended to minimise periods of vacancy prior to occupation and to ensure that properties are allocated in a way that better meets the needs of our customers. 

The Board ensures that all properties are in a good state of repair.  It uses stock condition surveys to inform maintenance activities. 

Residents who moved into their properties after 1 April 2015 pay a “target rent” based on a social housing model.  This tends to equate to around 60% of market rent.  Those already resident prior to this date had their rent converged over time to the target rent – a process which has now fully concluded.  From April 2026 new tenancies are based on a simpler rent formula – set at 60% of the market rent for an equivalent property in the same area. 

The scheme is subsidised by the wider Church of England.  Up to the end of 2025, this was via Vote 5 of the Archbishops’ Council’s budget – essentially a levy on the dioceses – which provided £6.4m (2024: £6.1m), plus further grants from the Archbishops’ Council since 2023 of £9m for 2023 and £19.7m for 2024-25.  These additional grants reflected the increased costs the Board was facing from inflation, higher interest rates, higher demand and increased regulatory compliance costs, and have enabled the Board to continue to offer retirement properties substantially below market rents. 

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From 2026, these two grant streams are replaced by a single grant from Archbishops’ Council as an allocation from the distributions of the Church’s endowment fund managed by the Church Commissioners for England.  This is part of a simplification of the national church financial flows in which the levies on dioceses have been replaced with direct funding.  The size of the grant was determined through the triennium funding process, and covers both support for the direct provision of retirement housing and the new financial wellbeing services. 

The Trustees remain grateful for the financial support from the wider Church towards its charitable work, and the commitment of the Church to invest in retirement housing and financial wellbeing services. 

Additionally, in 2025, the Board was awarded a grant of £2.1m over three years from the Warm Homes Scheme operated by the Department for Energy Security and Net Zero (DESNEZ).  This funding will be used to improve energy efficiency in rental properties.  The Board also received a grant of £0.2m (2024: £0.1m) from the Church of England net zero programme to support the costs of managing this programme, plus the installation of solar PV panels at Manormead Community Living which will generate around a third of the annual electricity consumed at this site. 

## **Community Living** 

The Board operates seven Community Living residential retirement communities.  Each setting offers residents their own self-contained flats (comprising a living room, bedroom, bathroom and a small kitchenette) within a residential community.  Each setting also offers communal dining facilities, meeting spaces, a library, a chapel, laundry facilities and shared garden space. 

Community Living is offered to retired clergy and their spouses / partners who wish to live as independently as possible in a Christian community.  Community Living residents include retired clergy individuals, couples and surviving spouses who wish to live in a close community without the need to manage their own property.  Typically, Community Living residents will have come to the setting later into their retirement; however, Community Living also welcomes those at the outset of their retirement.  The Community Living settings are also open to certain categories of retired lay worker and retired clergy who ministered for other denominations. 

The Board charges for the accommodation using a rent and service charge system and operates a subsidy arrangement to assist those of its residents who are unable to pay for those support charges which are not eligible for state assistance. 

The total cost of running community living including central overheads, is largely met by the income the Board receives through rent and service charges.  The shortfall – including costs relating to the former nursing home closed in 2017 – is met from grants, voluntary donations and investment income received by the General Purposes Fund.  In 2025, legacies and miscellaneous donations amounted to £0.3m (2024: £0.2m).[1] 

> 1 See note 4 for further details of the difference between charitable income from rent and service charges, and charitable expenditure incurred. 

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## **Mortgage and Shared Ownership Schemes** 

The Board has previously assisted clergy in purchasing retirement properties through a mortgage scheme, which closed to new applicants in 2008, and a shared ownership scheme which ran from 2008 to 2022.  The Board continues to support customers who have housing through these arrangements. 

In relation to mortgages, a fixed-interest mortgage option was in operation until 31 December 1982.  Mortgagors had the option to pay interest on the amount loaned during the life of the loan and then on redemption repay the nominal amount of the loan or pay one-half of the interest due during the life of the loan and on redemption repay the nominal amount of the loan together with the unpaid interest.  Two loans were outstanding at the end of the year, on which the mortgagors are paying one-half of the interest due. 

A value-linked mortgage option closed on 31 March 2008.  Mortgagors pay an interest-only element on the advanced sum, with the rate of interest being subject to an annual uplift in line with increases in Church pensions.  When the property is sold or the mortgage redeemed, the sale proceeds are divided between the mortgagor and the Board in the same proportions as when the loan was advanced.  At the end of the year mortgage loans were outstanding on 323 properties (274 from the Charity and 49 from the subsidiary company CEPB Mortgages Ltd) (2024: 368 properties (317 from the Charity and 51 from the subsidiary company CEPB Mortgages Ltd)). 

Through the Shared Ownership scheme, the household took at least a 25% equity share, with the Board contributing up to £150,000.  The household pays a rent on the unowned share, and a service charge which reflects the cost of insuring the property (and maintenance where the household prefers the Board to do this).  Additional shares of the property can be bought by the customer, and the Board will gladly assist those who seek to buy outright ownership, refinance the Board’s share, or switch to a full repairing and insuring lease.  The number of shared ownership properties at the end of 2025 was 79 (2024: 84).  Following a review, the Board closed the shared ownership scheme to new applicants in 2022.  This was primarily because the shared ownership marketplace had developed significantly since 2008, such that there are now sufficient products on the market which offer comparable or better value options for those looking for this type of arrangement. 

## **Signposting to alternative housing options** 

The Board continues to support existing residents and those approaching retirement in exploring alternative housing options with other providers which expands the range of choice available to clergy.  In 2025 a total of 30 households (2024: 26) were supported in securing options with other providers, where that best met their retirement plan. In addition to signposting to later life home ownership products, alternative rental options include housing associations and a range of Christian charities which offer rental, supported housing or residential care. 

Through information and signposting, the Board also supports residents and their families seeking a care home or extra care facility as the next stage in their retirement. 

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## Administration of pensions 

During the period covered by this report, the Church of England Pensions Board was the Trustee of three pension funds – the Church of England Funded Pension Scheme, the Church Workers Pension Fund, and the Church Administrators Pension Fund. 

The administration of pensions for the clergy is one of the charitable objects of the Board; this is carried out at no cost to the charitable funds since the administration costs are charged to the relevant pension fund. 

Use of the Companion Employer Hub continued to grow strongly during 2025. A total of 4,508 processes were completed through the Hub during the year, compared with 703 in 2024, covering routine activities such as data updates, submissions, and employer-initiated pension events. By the end of 2025, 330 employers were actively using the Hub, representing approximately 63% of employers participating in the Church Workers Pensions Fund (CWPF). The Hub is currently available for CWPF employers, with other schemes using alternative, largely automated reporting arrangements _._ 

## Review of 2025 activities 

## **Housing** 

The Board helps clergy who have lived in tied accommodation to find a retirement home that suits their circumstances. This includes Church retirement housing, help to explore options with other providers and assistance with alternatives such as later life home ownership.  We seek to support residents as circumstances change during retirement, supporting with welfare advice and later life moves. 

In 2025 we added 30 new homes to our property portfolio, and we will be adding more quality, safe, energy efficient 2- and 3-bed modern homes in 2026, to meet demand. 

There was a slowdown in the number of new applications in the second half of the year, almost certainly due to clergy delaying retirements while awaiting benefit improvements. 

Responding to feedback from recent applicants, we have improved our property bulletin and guidance on choices available.  We are also improving our property acquisitions process, drawing on more data from applicants to better inform purchases for our portfolio. Our Community Living schemes continue to go from strength to strength – and are an option at any stage during retirement. 

We are growing connections with other housing providers to offer broader choices at and in retirement beyond what our own portfolio can offer.  Last year 30 households took up this route.  We also helped 12 households who initially approached us for a rental property but, through information on later life homeownership, found they were able to purchase their own retirement home. 

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In April, we welcomed OCS as our new principal repairs and maintenance contractor for our rental properties. In 2025, OCS raised and completed almost 3,600 repairs for residents. Feedback shows 84% of residents were extremely satisfied or satisfied with the work carried out by OCS.  We will be working together through 2026 to further develop the new repairs service based on what we’ve learned together so far. 

In collaboration with the Church’s Net Zero programme, the Pensions Board is investing to improve the energy performance of its properties.  We are planning bespoke improvements for 247 existing properties over the next two years.  Works include additional insulation, new windows, heating controls and solar installations.  Surveys commenced in 2025. 

We also commenced a cyclical programme of property condition surveys in 2025.  These will inform our property asset strategy and planned works programme.  We are grateful to our residents for providing the surveyors with access to their homes to carry out their work. 

Property improvements in Community Living included new kitchens in all flats at Stuart Court, solar panels for Manormead, and replacement of the sea-facing windows at Dulverton Hall. 

In June, the Pensions Board was provisionally awarded £65m from the Church’s national spending plans process towards the cost of continued provision of Church retirement housing over the next three years.  This significant investment means we can continue to support those retirees who need us, working with them and their families to help make informed choices about their retirement home.  It also enables the enhanced maintenance programme.  The first tranche of this funding was formally confirmed in January 2026. 

The Board continues to value the engagement and feedback of our Residents’ Panel.  The panel works with our Housing team to help us continually develop our services.  The panel meets four times a year, mainly online.  In the last year it discussed a range of topics, from repairs and maintenance to service standards and welfare support. 

## **Financial Wellbeing Services** 

In 2024, the Pensions Board consulted with clergy about what would help them in planning more confidently for retirement, including choices on future housing.  Hundreds of clergy took part through surveys which, together with feedback from dioceses and other organisations, provided rich feedback and enthusiastic support to shape our future plans.  Clergy are seeking practical, tailored help and investment in their financial wellbeing throughout ministry, and specific choices at important stages of their life.  In particular, clergy want help to overcome some of the barriers that make buying a house so difficult while in ministry; plus help with saving and personal financial planning. 

Through the first part of 2025, the Board engaged with the Church to share this feedback and explore the scope for funding of the financial wellbeing services that clergy are seeking.  In June 2025, the Pensions Board was provisionally awarded £30m of funding through the Church’s national spending plans to bring to life those ideas that clergy thought might make a real difference to their circumstances.  The first tranche of this funding was confirmed and received in 2026. 

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## **Administration of Pensions** 

All the defined benefit pension schemes continue to be fully funded on a prudent basis, which means that the assets held by the schemes are expected to be sufficient to cover the pensions already earned and promised to members.  The good funding position has been made possible through sustained investment performance, cost reduction, favourable market conditions and the continuing support of employers and Responsible Bodies. 

In July 2025, the Church of England’s General Synod agreed to substantially improve the pensions provided by the Church of England Funded Pension Scheme (CEFPS).  The new benefits include restoring and resetting the accrual rate for post 2011 service back to 60ths, removing the service cap, and amending the definition of pensionable stipends, all with the aim of improving pensions for members.  Synod also requested these new benefits be retrospective including an uplift for those already in receipt of pension.  The Board worked closely with the Archbishops’ Council to ensure its recommendations to Synod were workable.  The Board prepared the required changes to the Scheme Rules for consideration by Synod in February 2026, which would allow the new benefits to come into effect from 1 April 2026. 

In parallel, the Board conducted the statutory valuation of the CEFPS as at 31 December 2024. The valuation was concluded in December 2025.  It confirmed the robust funding position of the scheme, and having considered consultation responses from Responsible Bodies, the Board was able to further reduce the contribution rate for Responsible Bodies to 21% of the current year’s National Minimum Stipend from 1 April 2025.  This further reduction compares to a contribution rate of almost 40% (including deficit payments) only a few years ago. 

The Board was able to make pension increases from 1 April 2026 of 4.5% for pensions accrued prior to 2008 and 3.8% for pensions accrued thereafter; the Board applied its discretionary power to override the guaranteed minimum increase and ensure an increase matching September 2025’s inflation figure. 

The Church Workers Pensions Fund (CWPF) is also in a strong funding position.  In 2024 the Board secured all remaining benefits in the closed Defined Benefit Scheme through an insurance transaction (known as a ‘buy in’) with Aviva.  It means that all members in that section of the fund have added protection for their pension benefits.  This transaction also represented the Board’s first application of the Bulk Annuities Sustainability Charter – launched by the Board, insurers and other funds in 2023.  During 2025, the Board has worked with Aviva on the associated data reconciliation process. 

The Pension Builder sections of the CWPF continue to grow, with a further increase in the number of Church employers choosing these schemes to provide good, responsibly invested pensions to their employees.  Based on investment performance during 2025, the Board was able to award bonuses of 10% to all PB Classic members and 11.45% to PB 2014 members, to be paid in 2026. 

The statutory valuations of the CWPF and the Church Administrators Pension Fund (CAPF) are due as at 31 December 2025 and these will form an important part of the work programme for 2026. 

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The CAPF itself remains in a good financial position.  Its deficit recovery plan completed in December 2023 and early indications suggest no additional deficit contributions will be needed as a result of the 2025 valuation. 

The net assets of the pension schemes are summarised as follows: 

||Church of<br>England Funded<br>Pension Scheme<br>£m|<br>Church Workers<br>Pension Fund<br>£m|Church<br>Administrators<br>Pension Fund<br>£m|Total<br>£m|
|---|---|---|---|---|
|Total net assets|2,763|625|153|3,541|



The table below provides summary information for the most recent concluded actuarial valuation of each pension scheme at the date indicated.  The CWPF and CAPF valuations as at 31 December 2025 will be undertaken during 2026 and concluded by 31 March 2027. 

||Church of England<br>Funded Pension<br>Scheme<br>£m|Church Workers<br>Pension Fund<br>£m|Church<br>Administrators<br>Pension Fund<br>£m|
|---|---|---|---|
|Date of Valuation|31 Dec 2024|31 Dec 2022|31 Dec 2022|
|Total Technical<br>Provisions|(2,010)|(483)|(104)|
|Total net assets available<br>for benefits|2,570|600|102|
|Total pension scheme<br>surplus(deficit)|560|117|(2)|



The Board manages pensions administration in house.  The administration team consistently achieved or exceeded the internal Service Level Agreement target level of 95% throughout the year.  Retiree satisfaction was consistently scored above 8 out of 10, with feedback reviewed by management.  The annual sentiment survey of members again showed over 80% satisfied or very satisfied with the service received. 

The PensionsOnline portal, which allows members to find information about their pensions, update their details and run illustrations, continues to be heavily used by members.  By the end of 2025, 58% of members had registered to use PensionsOnline; members had run 14,995 processes to support their retirement planning or manage their pension.  Features such as the retirement illustrator have proved particularly popular, especially for clergy scheme members in the period around the July 2025 General Synod. 

The companion Employer Hub portal is also increasingly used by employers. 

During 2025, and as part of the NCIs’ Finance Transformation Project, a new Treasury Management System was installed.  This went live for outbound payments from September 2025.  This has greatly simplified the payment of retirement lump sums to members and improved payroll processing. 

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The Board continues to monitor and engage with the regulatory environment, and welcomed the Government’s publication of Regulations to enable a new type of pension for multiemployer funds – Collective Defined Contribution.  It was gratifying to see the final form of the Regulations take account of feedback offered by the Board in the consultation phase.  At the end of 2025 the Regulator’s draft Code of Practice was published for consultation.  The Board will be studying this as it continues to explore the feasibility of a new CDC section of the Church Workers Pension Fund.  This offers the possibility of offering this new type of pension to employees of church bodies, simplifying lay pension arrangements for the Church and offering members better and fairer pensions. 

## **Serving Members and Residents** 

The Pensions Board launched its new website in 2025, improving the way we communicate with members and residents.  The new website – www.cofepensionsboard.org – has been designed to make it easier for our members, residents, industry colleagues and external visitors to find relevant information quickly and easily. 

The new site has an ‘I am…’ feature on the homepage, inviting visitors to select the type of person they are; whether they are a member of the clergy, a church worker, a housing applicant, an existing housing resident, a family member of a resident, or an investor or regulator.  From here, visitors are provided with frequently asked or requested information, making it quicker to find content on demand. 

In 2025, we introduced a new service charter which sets expectations as to what our members can expect from the Pensions Board and what we ask of members to help us to meet those expectations.  The charter uses our values as its framework and is informed by members’ feedback. It promotes our commitment to keeping members’ data secure, and doing things right first time.  We use this in service design and staff training. 

More than 3,900 members participated in our second annual ‘sentiment’ survey, which provides valuable feedback on our work.  The survey showed 82% of pension scheme members and 80% of housing residents were satisfied/very satisfied with the service they received from the Board in relation to their pensions.  76% of members said they are likely to speak positively about the Board, and 79% agreed or strongly agreed with the statement, “I have confidence in the Pensions Board to do the right thing for me, when I ask”. 

## The Board’s Approach to Investment and Stewardship 

We responsibly invest the c.£3.5bn funds entrusted to us to ensure we can pay pension promises: now, and for the long term.  As a leader in ethical and responsible investment, and guided by Church teaching, we work with other pension funds and the companies in which we invest to drive lasting change to the world around us, to protect our members pensions and the world into which they will retire. 

Consistent with what our members have told us in member surveys, ethical and responsible investment is at the heart of our approach to investment and Trustee decision-making. Stewardship is core to how we deliver upon this, combining financial responsibility with the 

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responsibility to shape corporate behaviour and market systems, to create long-term value for our members. 

In 2025, we agreed five new responsible investment priorities in response to the changing geopolitical and risk landscape, drawing on our strengths as a global leader in responsible investment, and the partnerships and collaborations we have built over the past years. 

Our new priorities centre on: 

- Supporting ethical and responsible markets by strengthening the voice of, and partnerships with, faith-based ethical investors. 

- Tackling global systemic risks (e.g. climate change) with a strengthened focus on the energy, food and mining sectors. Systemic risks are those which are too big to ignore or try to diversify away from. Working together with leading asset owners (including other pension funds) around the world to understand what systemic risks mean for the fund’s investments in the long term and taking steps now to address these will enhance the security of members’ pensions. 

- Strengthening our home UK market to be a global leader on corporate governance and responsible investment. 

- Supporting peacebuilding and respect for human rights to address growing forms of conflict and challenges to human rights, recognising the unique presence and role of the Anglican Church in regions afflicted by conflict. This priority builds on the learning of work with the mining industry and will see the foundation of a Global Centre for Peacebuilding and Business. 

- Delivering real-world impact through our investments and stewardship so that investments can be a positive force for good and deliver the returns needed to meet pension promises into the 22nd century. 

The 2025 member survey showed strong support for these priorities. 

The Board continues to represent our members by exercising votes at the AGMs of the companies in which we invest. Last year we voted in 99.9% of shareholder ballots, voting against company management recommendations 18.4% of the time where these did not align with the Board’s policies, such as those on executive pay.  We also pre-declared votes ahead of important company AGMs.  This is to signal our position more publicly about a concern we have with a particular corporate practice, or simply to note the progress that has been made in engagement.  Often, this still requires continued engagement with the company. 

The Board continues to report in detail on its responsible investment activities through the Annual Stewardship Report and Task Force on Climate Related Financial Disclosures (TCFD) reporting and maintained its signatory status under the UK Stewardship Code under the auspices of the Financial Reporting Council. 

Two examples of the Board’s work in practice in 2025: 

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## _**Global Centre for Peacebuilding and Business**_ 

Recognising the need to strengthen investor and business engagement in supporting peacebuilding in a world of growing conflict, the Board is supporting a new dedicated Global Centre for Peacebuilding and Business based in Cape Town, South Africa. 

The Global Centre is focusing on the intersection between conflict and the role of mineral demand, which can be a driver or sustainer of conflict. Drawing upon the experience and work of the Pensions Board, the Global Centre will work with other corporate actors and investors to support peacebuilding programmes in different conflict environments – Democratic Republic of Congo (DRC) and Mozambique. The new Centre draws together business, investors and support of representatives from the Anglican Communion. 

The foundations for this have been laid over the past two years, and the formal launch took place in February 2026. 

## _**Global Investor Commission on Mining 2030**_ 

Mining is a systemically important sector for supply chains and for the climate transition, and a strategic priority for the Pensions Board.  The Global Investor Commission on Mining 2030, set up and chaired by the Board, has unveiled its 10-year vision and detailed supporting recommendations to achieve it. 

The vision – unveiled in a meeting with President Lula of Brazil, on the eve of the world’s largest responsible investment conference – sets out the need to consolidate market expectations of mining companies and the key role that users of mined products need to play to support responsible mining. 

At its core is a vision that every mining company operates to high standards, avoiding and minimising harm, and leaving a lasting value for communities. Specifically, the vision: 

- Recognises the systemic importance of the mining sector to meet the needs of growing economies and the energy transition with a vision and recommendations to support market conditions that reward responsible mining practices while meeting rising demand. 

- Sets a 10-year timeline for all mines to be operating to global best practice performance standards, helping reduce risks and unlock opportunities for society, investors and investor portfolio companies. 

- Supports the creation of an independent International Minerals Agency (IMA) to monitor global mineral supply and demand as well as illicit mineral flows; investor expectations for mineral purchasers including auto and big tech firms; supports a Global Legacy Fund to tackle post-closure issues; and a dedicated Global Centre for Peacebuilding and Business based in South Africa. 

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## **Investment performance in 2025** 

The global economy in 2025 has reflected the uncertainty that derives from persistent major conflicts, concerns about international trade and mounting inflation pressures leading to a tightening of domestic policy agendas.  Despite periods of market instability, equity markets generally strengthened over the year, with much of the US market growth again concentrated in a handful of large artificial intelligence companies.  Though closer to historic norms, interest rates remain higher than experienced in the 2010s, a direct result of actions by central banks to curb inflation, which affects the purchasing power of businesses and consumers. 

The Board, as a long-term, well-diversified investor, remains well placed to weather uncertainty. Thanks to steady and persistent returns in our growth assets over the past two decades (an average of 8.2% p.a.), our schemes continue to show strong funding positions. 

Overall, the Church of England Investment Fund for Pensions (CEIFP) which invests the assets in a balanced portfolio for growth, delivered a return of 9.5%.  The highest returns, of 17.9%, were in our Public Equity Pool, i.e. assets invested in stock markets, of which the Board’s relatively recent investment in emerging market equities returned 26.8%. 

The Board’s diversified income pool, which includes investment in infrastructure projects and private debt, returned 5.6%.  The Board also received almost £100m in distributions from private market investments during the year. 

The Board’s gilts (UK government bonds) and Liability-Driven Investment (LDI) portfolio is the part of our portfolio designed to provide income streams that most closely match the money to cover future pension payments. At the end of the year we had £593m invested in gilts and LDI. 

In recent months, a slowing rate of inflation has allowed an easing in short-term interest rates in the US and the UK. However, as we look ahead, the confluence of unresolved regional conflicts, the competition in artificial intelligence technology and for mineral resources, fiscal pressures and potential geopolitical fragmentation, all present persistent risk factors that reinforce the value of a diversified portfolio and robust risk management framework. 

## Financial Review 

Total income for 2025 was £42.0m (2024: £63.7m).  Income from charitable activities of £14.0m (2024: £13.6m) relates to the recovery of administrative costs in respect of the pension schemes administered by the Board.  The remainder £28.0m (2024: £50.0m) relates to the Board’s housing activities, of which £15.9m (2024: £15.9m) derives from rents, service charges and mortgage payments. 

In addition to the income received through provision of its services, the Board relies upon voluntary income sources to sustain its charitable housing activities.  Income from grants, donations and legacies was £7.1m (2024: £26.2m). This includes support from the wider Church of England, partly through Vote 5 of the Archbishops’ Council’s budget, under which a grant of £6.4m (2024: £6.1m) was made towards the provision of retirement housing. 

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The main difference in income between 2024 and 2025 relates to the timing of additional grant funding from the Archbishops’ Council.  A £19.7m grant intended to cover both 2024 and 2025 was fully recognised in the 2024 accounts.  As a result, income in 2025 appears lower because the related funding had already been recognised in the prior year. The grant itself was paid in two instalments in each financial year. 

Total income from donations and legacies in 2025 was £0.4m (2024: £0.2m) for which the Board is extremely grateful.  Grant income of £0.1m was received from the Warm Homes Scheme operated by DESNEZ, £0.2m in relation to the Net Zero grant, and £0.1m relation to other grants. 

The Board also received investment income of £1.9m (2024: £3.1m), and gains arising from the sale of rental & shared ownership properties of £3.0m (20 rental and 4 shared ownership) (2024: £4.9m, 46 rental and 4 shared ownership). £111k of investment income was a result of joint venture in ChECS which registered a net surplus in 2025 from its new subsidiary, the Parish Giving Scheme (PGS), following ChECS becoming sole member of PGS on 1 January 2024. 

The Board continues to develop the portfolio through the sale of properties not suitable for retention as they become vacant, using the proceeds of sale, along with external borrowing, to fund the purchase of new properties. 

Total expenditure for 2025 totalled £43.3m (2024: £41.2m), with expenditure on charitable activities totalling £43.2m (2024: £41.1m). The largest component of expenditure was on rental properties of £17.4m (2024: £16.6m), with the increase reflecting higher repairs & maintenance costs for rental properties. Expenditure on Community Living was £7.5m (2024: £7.0m). 

Charitable expenditure also includes the cost of administering the pension schemes which was £14.0m (2024: £13.6m) – this is a figure which varies year to year in large part due to the level of work on statutory valuations within the year. 

Total funds stood at £152.4m at the end of the year (2024: 151.9m). 

The value of fixed assets increased in the year to £313.2m (2024: £310.1m), largely reflecting net purchases for the rental portfolio, plus an increase in the value of charitable investments. 

The Pension Funds of which the Board is Trustee and Administrator are wholly separate from and not included in the financial statements of the charity. 

## External financing 

The Board has supported the long-term financing of its housing provision through the issue of two listed bonds, as well as making use of a Revolving Credit Facility (RCF). 

In 2015 the Board, via its subsidiary CHARM Finance plc, issued a £100m Bond, of which £70m was drawn down immediately.  This gave the Board access to long-term finance to purchase additional retirement properties to secure the future of clergy housing in retirement.  The Board 

20 



used part of the proceeds to repay existing short term borrowings and to acquire the economic interest in 196 CHARM rental properties which had been financed by the Church Commissioners and had previously been subject to significant restrictions.  Under the terms of the refinancing agreement, the Board is obliged to pay to the Commissioners any capital uplifts arising from the sale of any of these properties within a 10 year period which expired in August 2025. 

In 2018, the Board issued a £50m fixed rate bond, of which £30m was drawn down immediately and was predominantly used to repay existing borrowings. 

During 2024 the Board engaged with the market to refinance the Revolving Credit Facility and contracted with NatWest for a new £50m facility.  Almost all of the previous facility with Santander was refinanced in December 2024, with the final £4m refinanced in June 2025 and the Santander facility terminated.  As at the end of 2025 the total amount drawn under the RCF was £25.2m. 

The Board’s borrowing as at the end of the year is summarised in the following table 

||Size of facility|Amount drawn as at<br>31.12.25|Applicable interest rate<br>as at 31.12.25|
|---|---|---|---|
|Loans from the Church<br>Commissioners|N/A|£36.1m|8.7%|
|New Revolving Credit<br>Facility|£50m|£25.2m|SONIA + 1.1%|
|2015 Bond|£100m (£30m retained)|£70m|3.126% indexed by CPI<br>(0% floor, 4% cap).<br>3.856%|
|2018 Bond|£50m(£20m retained)|£30m|3.509% fixed interest|



The Board retains Newbridge Associates as a corporate finance adviser to support its external financing activities. 

## Charity Investments 

The charity holds investments of £43.9m (2024: £42.2m), which generated income of £1.7m in the year (2024: £2.1m). 

During 2025 the majority of investments were held with Brewin Dolphin, the Charities Property Fund (CPF, managed by Savills) and the Property Income Trust for Charities (PITCH, managed by Swiss Life Asset Managers). The CPF and PITCH funds invest wholly in UK property, principally industrial, office and retail property.  They are structured as charity common investment funds, which allow investing charities to benefit from their statutory exemption from stamp duty on UK investments.  The charity also holds £0.9m (2024: £0.8m) in investment properties, covering a portfolio of 6 (2024: 6) properties. 

The amounts invested at the end of 2025 by the Board across the three funds are shown in the table below, along with the return generated by each investment for the Board over the year. 

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At times, the Board’s returns may differ from the funds’ own returns, because of timing of investment or disinvestment during the year. 

The Board’s Investment Committee monitors the performance of the charitable investments and undertook a review of the strategy and investment policy statement during 2025 in the light of changing economic conditions and business needs.  The Investment Committee remained satisfied with the appropriateness and performance of the investments. 

||Value at end<br>2025<br>£m|Allocation<br>%|2025 Return for<br>the Board<br>%|
|---|---|---|---|
|Savills Charities PropertyFund|19.4|44|6.3|
|Brewin Dolphin|16.1|37|11.2|
|Swiss Life Property<br>Income Trust for Charities|7.5|17|7.6|
|Investment Properties|0.9|2|5.0|
|Total|43.9|100|8.2|



The charity also holds £1.0m (2024: £0.9m) in short-term cash deposits with the CBF Deposit Fund (CBFDF, managed by CCLA Management Ltd.) 

Further information about the two charity property funds in which the Board is invested is provided below. 

||Fund returns net of fees|Fund returns net of fees|Fund returns net of fees|Yield|Net fund<br>size|
|---|---|---|---|---|---|
||2025|2022-<br>2025|2020-<br>2025|End 2025|End 2025|
||%|%pa|%pa|%|£m|
|Savills Charities PropertyFund|6.3|3.9|4.3|4.8|934|
|Swiss Life Property Income<br>Trust for Charities|7.6|3.9|3.7|5.4|503|



## Risk Management 

The Church of England Pensions Board’s risk management process supports management by facilitating the identification and assessment of significant risks to the achievement of objectives. There is a clearly defined Risk Management Policy which outlines the roles and responsibilities of Trustees, management, and staff. 

The Trustee Board reviews the strategic risk register and risk management arrangements frequently and at least annually.  This includes consideration of risk as part of the business planning and budgeting cycle.  The Board is supported by its Audit and Risk Committee, which regularly reviews the risk registers and the adequacy of arrangements in place to manage the risks. 

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The Board has considered its appetite for different types of risk and seeks assurance that additional actions are planned where residual risk is assessed to exceed the stated appetite.  The Board recognises that fulfilment of certain Pension Trustee and charitable duties requires a measure of risk taking – for example to deliver investment returns for members – and seeks to ensure that such activities are undertaken within an appropriate control environment.  The Board recognises that risks rarely materialise in isolation and is alert to the potential for multiple risks to materialise at the same time.  It further recognises that horizon-scanning – however good – will never be perfect.  It considers that the best mitigation is to have in place strong governance, a high quality executive management team and a culture in which risk is regularly discussed in an open and forward-looking way, supported by independent input and assurance activity. 

Individual departments and identified risk owners are responsible for the identification, assessment, and review of risks in their area of responsibility.  Risks are prioritised using an agreed scoring methodology, with a score applied both before and after any mitigating action. The risk management process is facilitated and monitored by the Risk and Assurance function. The management of key risks is subject to independent review and assurance through the internal audit process, which reports to the Audit and Risk Committee. 

## **Principal Risks** 

The principal risks, which Trustees consider most significant, are shown in the following table together with a summary (not exhaustive) of key management actions. 

|**Risk**|**Key Management Actions include**|
|---|---|
|Failure or under-performance of a<br>critical supplier|•<br>Contract management, monitoring and two-way<br>feedback<br>•<br>Cyclical supplier reviews and retendering where<br>appropriate<br>•<br>Appropriate Investment Management Agreements<br>•<br>Input into ChECS (shared services) business planning<br>•<br>CofE finance transformationprogramme|
|Data loss, systems failure, cyber<br>incident or fraud.|•<br>NCIs’ Cyber resilience and Technology strategy, including<br>Cyber Essentials Plus certification<br>•<br>NCIs’ processes and programmes relating to counter-<br>fraud,data securityand GDPR,financial controls,etc.|
|Insufficient capacity to manage<br>multiple simultaneous risks or<br>external events|•<br>Business planning and risk management processes<br>•<br>Management oversight<br>•<br>Business continuity plans|
|Failure to manage change well:<br>high profile issue arising from a<br>Board decision, action or inaction|•<br>Good planning, governance and communication<br>processes<br>•<br>Trustee training<br>•<br>Consultative approaches to proposed changes<br>•<br>Complaints handling processes|
|Failure to understand and respond<br>to the paradigm shifts caused by<br>climate change|•<br>Climate change integrated into investment decision<br>making, with independent climate scenario analysis<br>•<br>Climate action plan and resulting actions<br>•<br>Consideration of physical risks and net zero in asset<br>planningdecisions|



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|**Risk**|**Key Management Actions include**|
|---|---|
|The Board’s housing offer<br>becomes unsustainable for<br>financial or regulatory reasons|•<br>Budgeting, forecasting, financial modelling, covenant<br>monitoring, horizon scanning<br>•<br>Engagement with key church stakeholders on funding<br>requirements and the changing policy environment<br>•<br>Retained professional advice<br>•<br>Diversified delivery strategy and demand monitoring<br>•<br>Net Zero feasibility programme<br>•<br>The development of new financial wellbeingservices|
|Regulatory change|•<br>Horizon scanning, professional advice, and stakeholder<br>engagement<br>•<br>Responsible investmentprogramme|
|Risk relating to responsible<br>investment activity or inactivity|•<br>Annual stewardship report accounting for work done and<br>commitments<br>•<br>TCFD reportingand StewardshipCode submissions|
|Key person risk (Trustees and<br>staff)|•<br>Board diversity and skills monitoring<br>•<br>NCIpeopleprogramme|
|Strategic plans do not deliver|•<br>Rhythm of strategic and business planning and review<br>supported by professional advisers<br>•<br>Engagement with keystakeholders|
|Pensions scheme covenant(s)<br>materially weakened leading to<br>funding strain|•<br>Covenant monitoring and integrated risk management<br>and liaison with employers<br>•<br>Strong funding level<br>•<br>Liaison with Archbishops' Council on wider Church<br>financial issues, including drawing on the Diocesan<br>Finance Review<br>•<br>Horizon scanning and ad-hoc simulation or scenario<br>planning|
|Failure to comply with Landlord<br>regulatory responsibilities|•<br>Landlord responsibilities identified and compliance<br>monitoring to the Housing Committee<br>•<br>Retained third party support for community living<br>•<br>Dedicated compliance management roles<br>•<br>Regular review meetings with key contractors<br>•<br>Safeguarding training programme<br>•<br>Whistleblowing policyand training|
|Investments and scheme funding|•<br>Retained professional advice<br>•<br>Reviews of investment strategies and risks for each<br>scheme, including hedging strategies<br>•<br>Valuations processes and annual actuarial reviews and<br>updates<br>•<br>Monitoring processes|



In addition, the Church of England Shared Services (ChECS) charity, which provides various shared services to the National Church Institutions including the Pensions Board, maintains its own strategic risk register.  The Board receives information on this and is able to input to the consideration of ChECS risks via its nominees to the ChECS Board.  The principal risks identified by ChECS with relevance for the Pensions Board include: 

- Operational resilience and performance 

- Cyber and business continuity 

- People and key person risk 

- The pan-NCI finance transformation programme 

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In assessing the strategic risks in 2025, the Board considered wider environmental factors, including, but not limited to: 

- The changing macroeconomic and geopolitical landscape including, for example, changing trends in global trade; the increase in global conflicts and the intersection of conflict zones and deposits of critical minerals; the outlook for interest rates over the next decade is likely to be different to the period prior to 2022. 

- The legacy of the period of higher inflation on members and beneficiaries, the Board’s own operations and the covenants of sponsoring employers. 

- Growing evidence of the impacts of climate change. 

- The rapid development of Artificial Intelligence and its unknown implications. 

The Board considers these factors and others as part of its integrated risk management for the pension schemes and in its charitable activities. 

## Going Concern 

The Board meets the cost of property purchases, fit outs and other working capital requirements through its grants and rental income and external borrowing, comprising a bank facility and two listed bond issues. The Board prepares annual budgets and regular re-forecasts, along with a three-year financial plan to ensure that it can meet its spending commitments as they fall due, and fulfil the terms and conditions associated with external borrowing.  In addition, the Board has also prepared a long-term financial model to assist in considering financial viability over a longer period than that for which formal budgets and forecasts are prepared. 

The Board has considered the key risks and uncertainties which impact upon immediate liquidity and longer-term solvency.  These include the level of anticipated demand for its services, the resilience of voluntary income streams and changes in economic conditions.  It has modelled the impact of changes in these factors over time and has considered whether it has adequate reserves and appropriate contingency plans to deal with a range of potential adverse scenarios. 

The higher interest rate environment since late 2022, while generally beneficial for the pension schemes, presented challenges for the housing activities given the sensitivity of debt obligations to interest rates and inflation.  The Board received additional grant support from the Archbishops’ Council and the Church Commissioners covering the period 2023 to 2025.  To assist the Board in meeting the high level of demand from retiring clergy, as well as introducing new financial wellbeing services following on from the _Enabling_ Choice consultation process, the Board has been awarded £95.7m in grant funding for the 2026-2028 triennium. 

Having due regard to the above, the Trustees have reasonable expectation that the Board has adequate resources to meet its spending commitments as they fall due, including the servicing and repayment of debt and compliance with loan covenants for the foreseeable future, being a period of at least 12 months from the date of approval of these financial statements. Accordingly, the going concern basis of accounting in preparing the annual report and accounts continues to be adopted. 

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## Approach to Taxation 

In conducting its tax affairs, the Board will: 

- ensure that it conducts them not only in accordance with the letter but also the spirit of the law; 

- not behave in a manner that could be considered aggressive or abusive; 

- endeavour to obtain all reliefs available to it as a charity; 

- ensure that all tax filings are compliant with the law and that tax payments are made in a timely manner; 

- engage in dialogue with His Majesty’s Revenue & Customs (“HMRC”) on a regular basis to ensure that any matters where the tax treatment is uncertain or difficult are raised and discussed at an early opportunity; 

- maintain suitable processes and controls to ensure that the risk of non-compliance with filing and disclosure requirements is minimised; and 

- ensure appropriate compliance with any non-UK tax regimes in relation to filing and payment obligations by paying the right amount of tax in the right place at the right time and disclosing all relevant facts and circumstances to the tax authorities and claiming reliefs and incentives where available. 

## Reserves 

## _**Unrestricted funds**_ 

The unrestricted funds represent expenditure incurred by the Board on salaries and working expenses subsequently recovered from the pension funds administered by the Board. The Board has no net assets in its own right as a body corporate and, consequently, no unrestricted reserves are retained. 

## _**Restricted funds**_ 

Restricted income funds are to be spent or applied within a reasonable period from their receipt to further one or more, but not all of the charity’s charitable purposes. 

The largest restricted fund administered by the Board is the General Purposes Fund (“GPF”) at £137.1m (2024: £137.2m), which exists to provide for the relief of poverty among, and housing for retired clergy and church workers and their spouses/former spouses/dependants etc. This fund is considered to be restricted since the provisions for use of its resources are narrower than the statutory objects of the Board, which include the administration of pensions. 

Within the GPF, the Board has earmarked funds of £13.6m (2024: £15.5m) for the provision of future property maintenance costs. The designation of this fund merely expresses the current intentions of the Trustees and has no legal effect. Legally, the funds are available for spending on any of the objects of the GPF. 

The Clergy Retirement Housing Trust (“CRHT”) is a registered charity and is a linked charity of the Board (Charity No. 236627-2). The CRHT may use its property as residences for qualified 

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persons under the provisions of the Clergy Pensions Measure 1961 or any succeeding legislation. As a linked charity, it is accounted for as a separate restricted fund, which together with some smaller trusts is valued at £15.2m (2024: £14.7m). 

## Reserves policy 

Reserves are held to ensure that the Board can continue to deliver services to its beneficiaries and to meet its obligations and covenants in respect of debt financing in the event of a sustained reduction in voluntary income or some other adverse scenario. The Board considers annually the level of reserves that should be maintained and takes account of the requirements of the Charities SORP and the guidance issued by the Charity Commission (Charities and reserves CC19). 

Whilst it is unusual for a charity to hold reserves entirely within restricted funds, in practice the breadth of the restriction placed on the General Purposes Fund means that the Trustee has a reasonable expectation that it could meet all necessary charitable expenditure of the Board from this fund, excluding the administration of pensions, the cost of which is fully recoverable from the Pension Schemes. 

For the purposes of defining an appropriate reserves policy, the Board therefore considers ‘free reserves’ to be the net assets of the General Purposes Fund after excluding: 

- the value of tangible fixed assets net of secured borrowings, i.e. retirement properties (most of which are debt financed); 

- other fixed assets held for charitable purposes, which cannot be quickly realised; 

- the amount earmarked for property maintenance; 

- and after making provision for any pension liability (presently nil). 

The Board holds free reserves in the region of £30m - £35m, allowing it to generate annual investment income of around £1.5m whilst taking an investment approach which aims to preserve capital value.  This level of reserve is regarded appropriate to give considerable cover in the case of a one-off significant financial stress event. 

## Plans for the future 

The Pensions Board has been providing retirement services to the Church of England since 1926 and in 2026 the Board marks its centenary year. 

The services provided to the Church have developed markedly over the last century and they will continue to evolve to support the work of the Church and those who minister for it, 2026 will see a big change with the introduction of the new financial wellbeing services offered to Church of England clergy households to enable them to better engage with financial and retirement planning. 

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Meanwhile, the Board’s core work will continue to be serving its 43,000 pension scheme members and beneficiaries and 2,300 housing residents.  This includes managing health and safety, regulatory compliance and performance monitoring, good safeguarding practice, and working with partner employers and responsible bodies across the Church of England. 

The “centenary vision” and strategic priorities adopted by the Board in December 2019 continue to guide the Board’s strategic agenda.  These priorities – simplification, engaging in great conversations, and seeking to become more self-sufficient over the long term – resonate with stakeholders and are manifest in various parts of our plan. 

In addition to providing core services, particular priorities for 2026 include: 

1. Implementing the clergy pension improvements to transform the pension outcomes for clergy, and supporting the independent review commissioned by Synod. 

2. Implement and embed the new financial wellbeing services to make a tangible impact to clergy financial wellbeing. 

3. Progress the opportunity of CDC including getting ready to apply for authorisation for a Church CDC scheme. 

4. Deliver the planned maintenance programme for housing, and ensure the Board has affordable homes in the right place to meet demand. 

5. Embed the Board’s new Responsible Investment priorities to address global systemic risks in a changing world. 

6. Following on from the CEFPS valuation, review the Strategic Asset Allocation(s) to enhance returns, diversify income, and further the energy transition. 

7. Continue to invest in back office systems particularly the finance system and IT. 

8. Empower the Board’s teams to deliver change well, making the most of opportunities for integrated customer service across pensions, housing and financial wellbeing. 

The Board will also continue to monitor developments in pensions legislation and regulation, and contribute positively to industry and government initiatives as appropriate and in the interests of the Schemes’ members and stakeholders. 

## Structure, governance and management 

## Governance 

The twelve Trustees/members of the Board represent a balance of skills and expertise and are drawn from a wide range of constituencies. 

- The Chair is an appointment of the Archbishops with the approval of Synod. 

- There are four member nominated Trustees (elected by the members of the pension schemes): two are from the clergy schemes and one each from the CWPF and CAPF. 

- One Trustee is elected by the CAPF and/or CWPF employers 

- One appointed by the Archbishops following consultation with the Commissioners and 

28 



dioceses, as a proxy for the clergy ‘employers’. 

- Two Trustees are determined following an open process and appropriate consultation with i) the Chairs of the CofE Appointments Committee and the General Synod’s House of Laity; ii) Chair of the CofE Appointments Committee and the Prolocutors of the Convocations of Canterbury and York.  These are formally appointees of the Archbishops following the requisite consultations. 

- The remaining three Trustees are formally appointees of the Archbishops for their skills and expertise following an open process. 

The Board decides on the frequency of its meetings, which is typically five a year.  For Board meetings a quorum is present when four Trustees are in attendance, including at least one person elected by the members of the pension schemes administered by the Board. 

New Trustees receive an induction into the work and practices of the organisation.  All have access to an online database which includes outlines of their responsibilities, copies of the Rules and other documentation for each pension scheme, policies relating to the provision and operation of retirement housing assistance, safeguarding policies and procedures, and a library of past Board and committee papers. 

Trustees have completed either fully or partially the Pensions Regulator’s Trustee Toolkit, or an equivalent qualification, and regular training sessions are provided at Board meetings on a range of subject areas.  In 2025 Trustee training topics included updates on legal and regulatory developments; cyber security; and the Pensions Regulator’s new Defined Benefit Funding Code as applied to scheme valuations.  Individual Trustees and executives also participated in personal training, and industry training events and conferences through the year. 

The Board has committees to oversee the following areas: Audit and Risk, Housing, Investment, and Pensions.  The Board has delegated authority to make decisions concerning these areas within its terms of reference and to make recommendations to the full Pension Board on other matters. 

The Board has also delegated some of the day-to-day management and operation of the Schemes’ affairs to professional organisations as set out below. 

The Board completed an externally facilitated Board Effectiveness Review in 2022.  This was a thoroughly positive report, identifying numerous examples of best practice.  The most significant recommendation was to introduce a new Board portal to provide Trustees with secure access to papers and other documentation relevant to their roles, and this was implemented in 2023. The Trustees continue to informally reflect on the Board’s effectiveness at the end of each meeting. 

## Independent Auditors 

During the year, there have not been any non-audit services performed by the external auditors Crowe U.K. LLP 

29 



## Ethical Investment Advice 

The Board manages the Secretariat to the Ethical Investment Advisory Group (“EIAG”) on behalf of the Church of England’s national investing bodies – the Church Commissioners, the Church of England Pensions Board and the CBF Church of England funds managed by CCLA Investment Management Ltd.  The Board is not bound to follow the advice of the EIAG, however the Board draws on the work of the EIAG to inform its investment activities and policies. 

## The Charity Code of Governance 

The Church of England Pensions Board takes its governance responsibilities seriously and, as a large charity, aims to have a governance framework that is fit for purpose, compliant and efficient.  The Board pays regard to the (voluntary) Charity Governance Code.  The Board selfassessed against the 2017 Code and via a Legislative Reform Order in 2021, amended its governance to better align to the Code – for example through the introduction of term limits. 

The externally facilitated Board Effectiveness Review in 2022 validated the Board’s selfassessment against the Charity Governance Code. 

In recent years, the Board has further enhanced its compliance with the Code. These have included extending the gathering of feedback from customers, consideration of extending the aspects of diversity monitoring, and through a thorough review of the Board’s charitable services. 

The Code was updated and republished in 2025.  The Board has again completed a selfassessment against the Code. 

The Board has repeated its self-assessment against the new Code.  This continues to confirm a very high level of alignment.  The most notable difference is that the Code advocates limits of three three-year terms for Trustees, whereas the Pensions Measure 2018 provides for two fiveyear terms.  This was a conscious deviation from the 2017 Code because of the overriding need to provide a measure of continuity through triennial pension scheme valuation cycles. 

## Trustee Diversity 

The Board monitors its diversity profile annually and considers what action, where necessary, should be taken to address imbalances. As at 31 December 2025: 

- 58% of Trustees identified as women (66% from 1 January 2026, following elections and appointments) 

- 67% of Trustees identified as being members of the Church of England 

The figures for ethnicity, disability and LGBT+ have not been set out as they are small in the context of a small board, and their disclosure may identify individual Trustees. 

The average age of the Trustees fell in the bracket 55-64 years old. 

30 



## Trustees 

The Board has members elected and appointed by various means, which are described below. It delegates some of its business and decision making to sub-committees. 

## **Board Members (1 January 2025 to 9 July 2026)** 

|_The Chair, appointed with the approval of the General_<br>_Synod, by the Archbishops of Canterbury and York_|**Clive Mather (Chair)**|
|---|---|
|_Appointed by the Archbishops of Canterbury_<br>_and York_|**Roger Boulton**(to 31 Dec 2025)<br>**Emma Osborne**(to 31 Dec 2025)<br>**Ian Wilson**<br>**Hannah Gore-Randall**(from 1<br>Jan 2026)<br>**Wendy Davis**(from 1 Jan 2026)|
|_Appointed by the Archbishops of Canterbury and York_<br>_after consultation with the Chairs of the Church of England_<br>_Appointments Committee and the General Synod’s House_<br>_of Laity_|**Tony King**|
|_Appointed by the Archbishops of Canterbury_<br>_and York after consultation with the Chair of_<br>_the Church of England Appointments Committee and the_<br>_Prolocutors of the Convocations of Canterbury and York_|**The Revd Caroline Titley**|
|_Appointed by the Archbishops of Canterbury and York_<br>_after consultation with the Church Commissioners and the_<br>_representatives of the dioceses_|**Nikesh Patel**|
|_Elected by the members of the Church Workers Pensions_<br>_Fund_|**Canon Michaela Southworth**|
|_Elected by the members of the Church Administrators_<br>_Pensions Fund_|**Maggie Rodger**(to 31 Dec 2025)<br>**Sandra Shadrack**(from 1 Jan<br>2026)|
|_Elected by the members of the clergy pension schemes_|**The Ven Eleanor Robertshaw** <br>**The Revd Trudie Wigley**|
|_Elected by the Employers in the Church Workers Pensions_<br>_Fund and the Church Administrators Pensions Fund_|**Vicky Paramour**|



31 



## **Committee Members (1 January 2025 to 9 July 2026)** 

## _Audit and Risk Committee_ 

Maggie Rodger (Chair to 31 Dec 2025) Ian Wilson (Chair from 1 Jan 2026) Ebele Akojie* (from 13 March 2025) Wendy Davis** Tony King Canon Susan Pope* 

## _Housing Committee_ 

The Revd Caroline Titley (Chair) Lloyd Cochrane Jonathan Gregory* (to 30 June 2026) The Rt Revd Anne Hollinghurst* Tony King Clive Mather Tom Paul* The Ven Eleanor Robertshaw 

## _Pensions Committee_ 

Vicky Paramour (Chair) Wendy Davis (from 1 Jan 2026) Clive Mather Harus Rai* (from 1 Jan 2026) Maggie Rodger (to 31 Dec 2025) Sandra Shadrack (from 1 Jan 2026) Canon Michaela Southworth Ian Wilson (to 31 Dec 2025) 

## _Investment Committee_ 

Roger Boulton (Chair to 31 Dec 2025) Nikesh Patel (Chair from 1 Jan 2026) Hannah Gore-Randall** Sorca Kelly-Scholte* (from 12 Mar 2026) Clive Mather Emma Osborne (to 31 Dec 2025) Chris Rule* Padmesh Shukla* The Revd Trudie Wigley 

*Indicates members of committee who kindly give of their time and experience to the committee but are not trustees of the Pensions Board. 

**Non-trustee member to 31 December 2025; Trustee member from 1 January 2026. 

32 



## Attendance by Trustees at meeting of the Board and its Committee 

The table below sets out the attendance of Trustees at meetings of the Board and its Committee during 2025.  Where a member served for part of the year, the number of meetings that they could have attended is shown in brackets. 

|**Trustee**|**Board**<br>**(7)**|**Audit and**<br>**Risk**<br>**(3)**|**Housing**<br>**(3)**|**Investment**<br>**(5)**|**Pensions**<br>**(5)**|
|---|---|---|---|---|---|
|Clive Mather|7||3|5|5|
|Roger Boulton|7|||5||
|TonyKing|6|2|3|||
|Emma Osborne|5|||4||
|VickyParamour|6||||5|
|Nikesh Patel|4|||5||
|The Revd Canon<br>Eleanor Robertshaw|5||2|||
|Maggie Rodger|7|3|||5|
|Michaela Southworth|7||||5|
|The Revd Caroline Titley|6||3|||
|The Revd Trudie Wigley|7|||4||
|Ian Wilson|5|1|||3|



33 



## Reference and administrative information 

Charity Number 236627 Principal office Church House 29 Great Smith Street London SW1P 3PS Chief Executive John Ball MA(Oxon), MSc Actuary Aaron Punwani, Lane Clark and Peacock LLP Independent Auditor Crowe U.K. LLP, 55 Ludgate Hill, London, EC4M 7JW Bankers Lloyds Bank, 25 Gresham St, London, EC2V 7HN Corporate financial advisor Newbridge Advisors LLP, 46 New Broad Street, London, EC2M 1JH Investment Advisers Mercer Ltd, Tower Place West, 50 Lower Thames St, London, EC3R 5BU Willis Towers Watson, 51 Lime St, London, EC3M 7DQ Charity Investment Managers Brewin Dolphin, 12 Smithfield St, London, EC1A 9LA Savills Investment Management Ltd, 33 Margaret St, London, W1G 0JD Swiss Life Asset Managers UK Limited, 55 Wells St, London, W1T 3PT CCLA Investment Management Ltd, One Angel Lane, London, EC4R 3AB 

Enquiries should be addressed to 

Post: Church of England Pensions Board, PO Box 2026, Pershore, WR10 9BW Email: cepbfeedback@churchofengland.org Phone: 020 7898 1890 Website: https://www.cofepensionsboard.org/ 

34 



## Management 

The day-to-day management of the Board’s activities is delegated to the Executive Team, which is led by the Chief Executive. 

## **Staff Remuneration and Executive Pay** 

Almost all staff of the Pensions Board and those working for Church of England Central Services who provide support functions to the Board are covered by a unified pay policy that operates across all the National Church Institutions.  This includes those staff who have a contract of employment with the Pensions Board.  The policy is designed to ensure the same level of pay for all staff in posts with work of equal value which is based on a comprehensive job evaluation scheme, with staff being placed in one of seven ‘bands’.  For certain staff with specialist skills, typically those whose role requires them to hold a professional qualification, a market adjustment may be applied, the value of which is determined by reference to the lower quartile and median of market related salaries and is subject to annual review.  The NCIs use a range of appropriate external data tools and internal dedicated resource to advise on market rates. 

Staff pay is reviewed annually and any increases as a result of the annual pay negotiations are awarded with effect from 1 January each year. 

Certain senior roles, including that of the Chief Executives, sit outside the banding system, as the skill set required to fulfil the role is not readily measured within the NCIs’ standard job evaluation system.  Salaries for these roles are set individually with reference to the wider market place, typically comparing to the charity and public sector market, and is overseen by the Remuneration Committee comprising senior Trustees from each of the main NCIs. In general, these staff can expect the same percentage annual uplift for cost of living as other staff. Salaries in the Board’s investment function are set according to relevant industry benchmarks. 

The Board’s Community Living staff have a similar pay structure to that for NCI staff, with banding reflecting the nature and responsibility of their positions. 

The highest paid member of staff was in the investment team.  The annual salary for the highest paid member of staff was £276,000 (2024: £267,000), 11 (2024: 11) times the salary earned by the lowest paid member of staff and 5 (2024: 5) times the median salary. 

In common with the other National Church Institutions, the Pensions Board continues to be accredited with the Living Wage Foundation. 

Staff are typically eligible to join the Church Administrators Pension Fund or the Church Workers Pension Fund.  Pension scheme membership is offered on a non-contributory basis. 

35 



## Approval 

The Trustees Report was approved by the Trustees on 9[th] July 2026 and signed on its behalf by 


Clive Mather Chair 

## Statement of Trustees’ responsibilities in relation to the financial statements 

The Trustees are responsible for preparing the Trustees’ Annual Report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). 

The law applicable to charities in England and Wales requires the Trustees to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the charity and of the incoming resources and application of resources of the charity for that period. 

In preparing these financial statements, the Trustees are required to: 

- select suitable accounting policies and then apply them consistently; 

- observe the methods and principles in the Charities SORP; 

- make judgments and estimates that are reasonable and prudent; 

- state whether applicable accounting standards, comprising FRS 102, have been followed, subject to any material departures disclosed and explained in the financial statements; and 

- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charity will continue in business. 

The Trustees are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the charity and enable them to ensure that the financial statements comply with the Charities Act 2011, the Charity (Accounts and Reports) Regulations 2008. They are also responsible for safeguarding the assets of the charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. 

The Trustees are responsible for the maintenance and integrity of the charity and financial information included on the charity’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. 

36 



## Independent auditor’s report to the Church of England Pensions Board 

## **Opinion** 

We have audited the financial statements of The Church of England Pensions Board (the “Parent Charity”) and its subsidiaries (the “Group”) for the year ended 31 December 2025, which comprise: 

- the consolidated Statement of Financial Activities for the year ended 31 December 2025; 

- the consolidated and Parent Charity only Balance Sheets at 31 December 2025; 

- the consolidated Cash Flow Statement for the year then ended; and 

- the notes to the financial statements, including a summary of significant accounting policies. 

The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). 

In our opinion: 

- the financial statements give a true and fair view of the state of the Group’s and of the Parent Charity’s affairs as at 31 December 2025 and of the Group’s income and expenditure for the year then ended; 

- the Group and Parent Charity financial statements have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards; and 

- the financial statements have been prepared in accordance with the Charities Act 2011. 

## **Basis for opinion** 

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. 

## **Conclusions relating to going concern** 

In auditing the financial statements, we have concluded that the Trustees’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate. 

37 



Our evaluation of the Trustees’ assessment of the entity’s ability to continue to adopt the going concern basis of accounting included reviewing the detailed paper prepared by management setting out their assessment of the Group and Parent Charity’s ability to continue as a going concern. The assessment covers the period to 31 December 2027. 

We have discussed this with the Parent Charity’s management in order to fully understand their assessment including the associated systems and controls and the underlying assumptions applied. 

In addition to this we have: 

- reviewed the period used by Trustees to assess the ability of the Parent Charity and the Group to continue as a going concern; 

- checked the integrity and arithmetic accuracy of budgets and forecasts prepared by management covering the period of the going concern assessment; 

- discussed the Group’s cash flow forecast with management, challenging key assumptions; 

- obtained an understanding of the budgeting and forecasting process followed by management for the Parent Charity and the Group, including performing a retrospective review comparing the Group’s actual performance in the year to 31 December 2025 against the original budget to understand whether an indication of management bias exists; 

- reviewed and assessed the Group’s forecast compliance with debt covenants which the directors have used in their going concern assessment; and 

- considered the appropriateness of disclosure made in respect of going concern and ensuring it is consistent with our knowledge of the business and the forecasting exercise. 

We have no further observations arising from that evaluation. 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's and Parent Charity’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. 

Our responsibilities and the responsibilities of the Trustees with respect to going concern are described in the relevant sections of this report. 

## **Overview of our audit approach** 

## _Materiality_ 

In planning and performing our audit we applied the concept of materiality. An item is considered material if it could reasonably be expected to change the economic decisions of a user of the financial statements. We used the concept of materiality to both focus our testing and to evaluate the impact of misstatements identified. 

Based on our professional judgement, we determined overall materiality for the Group financial statements as a whole to be £3.21m, based on 1% of the Group’s total assets (2024: £3.26m, based on 1% of the Group’s total assets) due to it being an asset driven entity. 

38 



We use a different level of materiality (‘performance materiality’) to determine the extent of our testing for the audit of the financial statements.  Performance materiality is set based on the audit materiality as adjusted for the judgements made as to the entity risk and our evaluation of the specific risk of each audit area having regard to the internal control environment. Our performance materiality was set at 70% of the financial statement’s materiality, amounting to £2.3m (2024: £2.3m, set at 70% of the financial statement’s materiality). 

Where considered appropriate, performance materiality may be reduced to a lower level, such as for related party transactions. 

We agreed with the Audit and Risk Committee to report to it all identified errors in excess of £160k (2024: £163k). Errors below that threshold would also be reported to it if, in our opinion as auditor, disclosure was required on qualitative grounds. 

Overview of the scope of our audit 

Our audit was scoped by obtaining an understanding of the Group and its environment, including the Group’s system of internal control, and assessing the risks of material misstatement in the financial statements. We also addressed the risk of management override of controls, including assessing whether there was evidence of bias by the Trustees that may have represented a risk of material misstatement. 

The Group comprises three components, being the Parent Charity and its principal subsidiaries CEPB Mortgages Limited and CHARM Finance plc. Audit procedures were performed on the entire financial information of each component. The work performed on the components (excluding the Parent Charity) was completed to component performance materiality levels between £95k and £1m (2024: £97k and £1m). 

The main Group and its principal subsidiaries are accounted for from one central location, the Group’s registered office. The audits of the Parent Charity and subsidiaries were performed by the Group audit team in the UK. The consolidation was also subject to audit procedures performed by the Group audit team in the UK. 

## _Key Audit Matters_ 

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we identified. These matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. 

This is not a complete list of all risks identified by our audit. 

39 



## **Key audit matter** 

## **How the scope of our audit addressed the key audit matter** 

Going concern 

We considered the risk that the long-term going concern assessment was not appropriate. 

Details of the audit work performed and our observations on going concern are included in the “Conclusions related to going concern” section of this report. 

Refer to Note 1 (d) 

Fixed asset impairment assessment 

The Group holds significant levels of tangible fixed asset rental and shared ownership property assets at cost with a policy not to depreciate with a total of £224.9m held at 31 December 2025. 

Each year-end, management perform a impairment review which considers whether any properties within the portfolio should be impaired. This review utilises a range of valuation sources and applies a significant element of management judgment. 

We reviewed management’s overall impairment assessment including assessment against appropriate indicators.  We assessed the associated systems and controls, and performed our own audit work on the process, agreeing items to supporting evidence where possible including verification of the house price indices used within the impairment model to third party documentation. 

In addition to this, for a sample of individual properties we compared the property’s carrying value to the sale value of any similar properties in the same area. 

Following this work, we have determined that it is appropriate that no impairment charge is recognised in relation to the Board’s properties held at 31 December 2025. 

We considered the risk that the impairment review was inappropriate and the financial statements materially misstated. 

Refer to Note 12 

Our audit procedures in relation to these matters were designed in the context of our audit opinion as a whole. They were not designed to enable us to express an opinion on these matters individually and we express no such opinion. 

## **Other information** 

The trustees are responsible for the other information. The other information comprises the information included in the trustees’ annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. 

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent 

40 



with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. 

We have nothing to report in this regard. 

## **Trustees' Report** 

Under the Charities Act 2011 we are required to report to you if, in our opinion the information given in the Trustees’ Report is inconsistent in any material respect with the financial statements. We have no exceptions to report arising from this responsibility. 

## **Matters on which we are required to report by exception** 

We have nothing to report in respect of the following matters in relation to which the Charities (Accounts and Reports) Regulations 2008 require us to report to you if, in our opinion: 

- the information given in the financial statements is inconsistent in any material respect with the trustees’ report; or 

- sufficient accounting records have not been kept by the parent charity; or 

- the financial statements are not in agreement with the accounting records and returns; or 

- we have not received all the information and explanations we require for our audit 

## **Responsibilities of the trustees for the financial statements** 

As explained more fully in the trustees’ responsibilities statement set out on page 36, the trustees are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. 

In preparing the financial statements, the trustees are responsible for assessing the Group’s and the Parent Charity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charity or to cease operations, or have no realistic alternative but to do so. 

## **Auditor’s responsibilities for the audit of the financial statements** 

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be 

41 



expected to influence the economic decisions of users taken on the basis of these financial statements. 

Details of the extent to which the audit was considered capable of detecting irregularities, including fraud and non-compliance with laws and regulations are set out below. 

## **Extent to which the audit was considered capable of detecting irregularities, including fraud** 

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We identified and assessed the risks of material misstatement of the financial statements from irregularities, whether due to fraud or error, and discussed these between our audit team members. We then designed and performed audit procedures responsive to those risks, including obtaining audit evidence sufficient and appropriate to provide a basis for our opinion. 

We obtained an understanding of the legal and regulatory frameworks within which the Parent Charity and Group operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were the Charities Act 2011 together with the Charities SORP (FRS 102). We assessed the required compliance with these laws and regulations as part of our audit procedures on the related financial statement items. 

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which might be fundamental to the Parent Charity’s and the Group’s ability to operate or to avoid a material penalty. 

Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the Trustees and other management and inspection of regulatory and legal correspondence, if any. 

We also considered the opportunities and incentives that may exist within the Parent Charity and the Group for fraud. We identified the greatest risk of material impact on the financial statements from irregularities, including fraud, to be within the assumptions applied in the use of judgements and estimates and the override of controls by management. Our audit procedures to respond to these risks included enquiries of management about their own identification and assessment of the risks of irregularities, sample testing on the posting of journals, reviewing accounting estimates for biases including scrutiny and challenge of management’s impairment assessment ensuring policies are appropriate under the relevant accounting standards and applicable law, reviewing regulatory correspondence with the Charity Commission, and reading minutes of meetings of those charged with governance. 

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be 

42 



expected to detect non-compliance with all laws and regulations. 

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report. 

## **Other matters which we are required to address** 

In preparing the financial statements, the trustees are responsible for assessing the group’s and the parent charity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charity or to cease operations, or have no realistic alternative but to do so. 

## **Use of our report** 

This report is made solely to the charity’s trustees, as a body, in accordance with Part 4 of the Charities (Accounts and Reports) Regulations 2008. Our audit work has been undertaken so that we might state to the charity’s trustees those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charity and the charity’s trustees as a body, for our audit work, for this report, or for the opinions we have formed. 


## **Crowe U.K. LLP** 

Statutory Auditor London **Date:** 10 July 2026 

Crowe U.K. LLP is eligible for appointment as auditor of the charity by virtue of its eligibility for appointment as auditor of a company under section 1212 of the Companies Act 2006. 

43 



## Financial Statements 

## **Consolidated statement of financial activities of the Church of England Pensions Board for the year ended 31 December 2025** 

|Note<br>**Income from:**<br>Grants, donations and legacies<br>2<br>Investment income<br>3<br>Investment income – Income from partnerships<br>3<br>Charitable activities<br>4<br>Other income: gain on sale of fixed assets|**2025**<br>**Unrestricted**<br>**funds**<br>**Restricted**<br>**funds**<br>**Total**<br>**£’000**<br>**£’000**<br>**£’000**<br>-<br>7,138<br>**7,138**<br>-<br>1,787<br>**1,787**<br>-<br>111<br>**111**<br>14,031<br>15,868<br>**29,899**<br>-<br>3,032<br>**3,032**<br>14,031<br>27,936<br>**41,967**<br>(14,031)<br>(29,144)<br>**(43,175)**<br>-<br>(116)<br>**(116)**<br>(14,031)<br>(29,260)<br>**(43,291)**<br>-<br>(1,324)<br>**(1,324)**<br>-<br>1,802<br>**1,802**<br>-<br>478<br>**478**<br>-<br>-<br>**-**<br>-<br>-<br>**-**<br>-<br>478<br>**478**<br>**-**<br>151,906<br>**151,906**<br>-<br>478<br>**478**<br>-<br>152,384<br>**152,384**|**2024**|
|---|---|---|
|||**Unrestricted**<br>**funds**<br>**Restricted**<br>**funds**<br>**Total**|
|||**£’000**<br>**£’000**<br>**£’000**<br>-<br>26,185<br>**26,185**<br>-<br>2,145<br>**2,145**<br>-<br>991<br>**991**<br>13,634<br>15,853<br>**29,487**<br>-<br>4,865<br>**4,865**|
|Total income||13,634<br>50,039<br>**63,673**|
|**Expenditure on:**<br>Charitable activities<br>4<br>Raising funds<br>5||(13,634)<br>(27,511)<br>**(41,145)**<br>-<br>(83)<br>**(83)**|
|Total expenditure||(13,634)<br>(27,594)<br>**(41,228)**|
||||
|Total income less expenditure before gain on<br>investments||-<br>22,445<br>**22,445**|
|Net gain / (loss) on investments<br>9||-<br>1,353<br>**1,353**|
|**Net (expenditure) / income**||-<br>23,798<br>**23,798**|
|**Other recognised gains and (losses)**<br>Other gain : adjustment to pension provision<br>8||-<br>-<br>**-**|
|Total other gains||-<br>-<br>**-**|
||||
|**Net movement in funds**||-<br>23,798<br>**23,798**|
|**RECONCILIATION OF FUNDS**<br>Total funds brought forward at 1 January<br>Net movement in funds in year||**-**<br>128,108<br>**128,108**<br>-<br>23,798<br>**23,798**|
|**Total funds carried forward at 31 December**<br>16||-<br>151,906<br>**151,906**|



The income, expenditure and other recognised gains and losses all relate to continuing operations, none of which have been acquired during the year. 

The notes on pages 48 to 68 form part of these financial statements. 

Note – all figures within the consolidated statement of financial activities are the same as for the charity-only statement of financial activities. 

44 



## **Consolidated balance sheet of the Church of England Pensions Board as at 31 December 2025** 

|**as at 31 December 2025**|||
|---|---|---|
|Note<br>**FIXED ASSETS**<br>Investment assets<br>9<br>Programme related investments<br>10<br>Tangible assets - Community Living and IT<br>11<br>Tangible assets – Retirement Housing<br>12|**2025**<br>**Consolidated**<br>**£’000**<br>**£’000**<br>**£’000**<br>Funded by<br>CC*<br>Funded by<br>CEPB**<br>**Total**<br>-<br>43,903<br>**43,903**<br>18,569<br>1,585<br>**20,154**<br>-<br>24,206<br>**24,206**<br>17,565<br>207,337<br>**224,902**|**2024**|
|||**Consolidated**<br>**£’000**<br>**£’000**<br>**£’000**<br>Funded by<br>CC*<br>Funded by<br>CEPB**<br>Total<br>-<br>42,164<br>**42,164**<br>20,704<br>1,557<br>**22,261**<br>-<br>24,144<br>**24,144**<br>19,668<br>201,882<br>**221,550**|
|Total fixed assets|36,134<br>277,031<br>**313,165**|40,372<br>269,747<br>**310,119**|
|**CURRENT ASSETS**<br>Debtors<br>13<br>Short term deposits<br>Cash at bank and in hand|-<br>2,327<br>**2,327**<br>-<br>953<br>**953**<br>-<br>4,156<br>**4,156**|-<br>11,894<br>**11,894**<br>-<br>911<br>**911**<br>-<br>3,047<br>**3,047**|
|Total current assets|-<br>7,436<br>**7,436**|-<br>15,852<br>**15,852**|
|**CURRENT LIABILITIES**<br>Creditors: amounts falling due within one year<br>14<br>Loans repayable on sale of fixed assets<br>14|-<br>(7,175)<br>**(7,175)**<br>(36,134)<br>(453)<br>**(36,587)**|-<br>(6,220)<br>**(6,220)**<br>(40,372)<br>(513)<br>**(40,885)**|
|Total current liabilities|(36,134)<br>(7,628)<br>**(43,762)**|(40,372)<br>(6,733)<br>**(47,105)**|
||||
|Net current (liabilities)/assets|(36,134)<br>(192)<br>**(36,326)**|(40,372)<br>9,119<br>**(31,253)**|
||||
|Total assets less current liabilities|-<br>276,839<br>**276,839**|-<br>278,866<br>**278,866**|
|**NON-CURRENT LIABILITIES**<br>14|-<br>(124,455)<br>(124,455)<br>-<br>152,384<br>**152,384**<br>-<br>-<br>**-**|-<br>(126,960)<br>(126,960)|
|Net assets excluding pension provision||-<br>151,906<br>**151,906**|
|<br>Pension deficit provision<br>8||-<br>-<br>**-**|
|**NET ASSETS**|-<br>152,384<br>**152,384**|-<br>151,906<br>**151,906**|
|**FUNDS OF THE CHARITY**<br>Total unrestricted funds<br>16<br>Restricted funds (excl. pension reserve)<br>16<br>Pension reserve<br>16<br>Total restricted funds<br>16|-<br>-<br>**-**<br>-<br>152,384<br>**152,384**<br>-<br>-<br>**-**<br>-<br>152,384<br>**152,384**|-<br>-<br>**-**<br>-<br>151,906<br>**151,906**<br>-<br>-<br>**-**|
|||-<br>151,906<br>**151,906**|
|**TOTAL CHARITY FUNDS CARRIED FORWARD AT 31**<br>**DECEMBER**|**-**<br>152,384<br>**152,384**|**-**<br>**151,906**<br>151,906|



*Funded by the Church Commissioners 

**Funded by the Church of England Pensions Board 

(See Note 12 for more details) 

The notes on pages 48 to 68 form part of these financial statements. 

These financial statements were approved by the Trustees on 9[th] July 2026 and signed on their behalf by: 


Clive Mather Chair 

45 



## **Charity only balance sheet of the Church of England Pensions Board as at 31 December 2025** 

|**Note**<br>**FIXED ASSETS**<br>Investment assets<br>9<br>Programme related investments<br>10<br>Tangible assets - Community Living and IT<br>11<br>Tangible assets – Retirement Housing<br>12|**2025**<br>**£’000**<br>**£’000**<br>**£’000**<br>Funded by<br>CC*<br>Funded by<br>CEPB**<br>**Total**<br>-<br>43,916<br>**43,916**<br>14,144<br>1,261<br>**15,405**<br>-<br>24,206<br>**24,206**<br>17,565<br>207,337<br>**224,902**<br>31,709<br>276,720<br>**308,429**<br>4,425<br>2,699<br>**7,124**<br>-<br>953<br>**953**<br>-<br>4,095<br>**4,095**<br>4,425<br>7,747<br>**12,172**<br>-<br>(7,175)<br>**(7,175)**<br>(36,134)<br>(453)<br>**(36,587)**<br>(36,134)<br>(7,628)<br>**(43,762)**<br>**(31,709)**<br>**119**<br>**(31,590)**<br>-<br>276,839<br>**276,839**<br>-<br>(124,455)<br>**(124,455)**<br>-<br>152,384<br>**152,384**<br>-<br>-<br>**-**<br>-<br>152,384<br>**152,384**<br>-<br>-<br>**-**<br>-<br>152,384<br>**152,384**<br>-<br>-<br>**-**<br>-<br>152,384<br>**152,384**|**2024**|
|---|---|---|
|||**£’000**<br>**£’000**<br>**£’000**<br>Funded by<br>CC*<br>Funded by<br>CEPB**<br>**Total**<br>-<br>42,177<br>**42,177**<br>16,254<br>1,150<br>**17,404**<br>-<br>24,144<br>**24,144**<br>19,668<br>201,882<br>**221,550**|
|Total fixed assets||35,922<br>269,353<br>**305,275**|
|**CURRENT ASSETS**<br>Debtors<br>13<br>Short term deposits<br>Cash at bank and in hand||4,450<br>12,340<br>**16,790**<br>-<br>911<br>**911**<br>-<br>2,993<br>**2,993**|
|Total current assets||4,450<br>16,244<br>**20,694**|
|**CURRENT LIABILITIES**<br>Creditors: amounts falling due within one<br>year<br>14<br>Loans repayable on sale of fixed assets<br>14||-<br>(6,218)<br>**(6,218)**<br>(40,372)<br>(513)<br>**(40,885)**|
|Total current liabilities||**(40,372)**<br>**(6,731)**<br>**(47,103)**|
||||
|Net current (liabilities)/assets||**(35,922)**<br>**9,513**<br>**(26,409)**|
||||
|Total assets less current liabilities||-<br>278,866<br>**278,866**|
|**NON-CURRENT LIABILITIES**<br>14||-<br>(126,960)<br>**(126,960)**|
|Net assets excluding pension provision||-<br>151,906<br>**151,906**|
|Pension deficit provision<br>8||-<br>-<br>**-**|
|**NET ASSETS**||-<br>151,906<br>**151,906**|
|**FUNDS OF THE CHARITY**<br>Total unrestricted funds<br>16<br>Restricted funds (excl. pension reserve)<br>16<br>Pension reserve<br>16<br>Total restricted funds<br>16||-<br>-<br>**-**<br>-<br>151,906<br>**151,906**<br>-<br>-<br>**-**|
|||-<br>151,906<br>**151,906**|
|**TOTAL CHARITY FUNDS CARRIED FORWARD AT**<br>**31 DECEMBER**|-<br>152,384<br>**152,384**|**-**<br>151,906<br>**151,906**|



*Funded by the Church Commissioners 

**Funded by the Church of England Pensions Board 

The notes on pages 48 to 68 form part of these financial statements. 

46 



## **Consolidated cash flow statement of the Church of England Pensions Board for the year ended 31 December 2025** 

|**ended 31 December 2025**||||
|---|---|---|---|
|||**2025**|**2024**|
|**Cash flow from operating activities:**||||
||Note|£’000|£’000|
|Net movement in funds (as per the statement of financial<br>activities)||478|23,798|
|Adjustments for:||||
|Depreciation and impairment – Community Living and IT<br>systems|11|1,287|1,180|
|Amortisation – Santander & Natwest arrangement fee|4|68|38|
|Amortisation – CHARM Finance PLC bond set-up costs|4|28|28|
|Losses / (gains) on investments|9|(1,802)|(1,353)|
|Investment – arrangement fees|9|63|53|
|Dividends, interest and rents from investments|3|(1,666)|(2,074)|
|Gain from partnerships|3|(111)|(991)|
|Gains on disposal of tangible assets – Retirement Housing||(3,032)|(4,865)|
|Movement in pension liability|8|-|-|
|Movement in debtors|13|9,567|(6,960)|
|Movement in creditors: amounts due within less than one year|14|955|(2,092)|
|Net cash (used in) / generated by operating activities||5,835|6,762|
|**Cash flow from investing activities:**||||
|Cash flows from investing activities:||||
|Dividends, interest and rents from investments|3|1,666|2,074|
|Proceeds from sale/redemption of mortgage properties|10|2,218|2,438|
|Proceeds from the sale of tangible assets – retirement housing<br>properties|12|8,390|10,533|
|Purchase of tangible assets – retirement housing properties|12|(8,711)|(14,445)|
|Purchase of tangible assets – Community Living and IT systems|11|(1,349)|(2,009)|
|Net cash generated from / (used in) investing activities||2,214|(1,409)|
|**Cash flows from financing activities:**||||
|Repayment of loans from Church Commissioners|14|(4,238)|(4,215)|
|Repayment of dioceses' share of rental properties|14|(60)|(152)|
|Repayment of Natwest RCF|14|(2,600)|1,500|
|Natwest funding arrangement fee||-|(250)|
|Net cash generated by / (used in) financing activities||(6,898)|(3,117)|
|Change in cash and cash equivalents in the year||1,151|2,236|
|Cash and cash equivalents at the beginning of the year||3,958|1,722|
|Cash and cash equivalents at the end of the year||5,109|3,958|



**Cash and cash equivalents and net debt comprise the following balances** : 

||**At 1 January**|**Cash Flows**|**At 31 December**|
|---|---|---|---|
||**£’000**|**£’000**|**£’000**|
|Cash at bank and in hand|3,047|1,109|4,156|
|Short term deposits|911|42|953|
|Total cash and cash equivalents|3,958|1,151|5,109|
|Bond financing|(100,000)|-|(100,000)|
|Repayment to NatWest|(27,800)|2,600|(25,200)|
|Total net debt|(123,842)|3,751|(120,091)|



The notes on pages 48 to 68 form part of these financial statements. 

47 



## **Notes to the financial statements of the Church of England Pensions Board for the year ended 31 December 2025** 

## _**1. Accounting policies**_ 

## _**a) Legal Status**_ 

The Church of England Pensions Board (“the Board”) is a body corporate established in 1926 but now governed by the Church of England Pensions Measure 2018. It is a registered charity in England and Wales (Charity No. 236627) and is regulated by the Charity Commission. 

The Charity’s address is: 29 Great Smith Street, London, SW1P 3PS. 

## _**b) Basis of preparation**_ 

The consolidated and charity-only financial statements have been prepared in accordance with: 

- Financial Reporting Standard 102: The Financial Reporting Standard applicable in the UK and Republic of Ireland (“FRS 102”); 

- Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their financial statements in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (“the SORP”); and 

- the Charities Act 2011. 

The financial statements have been prepared to give a true and fair view and have departed from the Charities (Accounts and Reports) Regulations 2008 only to the extent required to provide a true and fair view. This departure has involved following Accounting and Reporting by Charities preparing their financial statements in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) rather than the Accounting and Reporting by Charities: Statement of Recommended Practice effective from 1 April 2005 which has since been withdrawn. 

The Board meets the definition of a Public Benefit Entity (“PBE”) as set out in FRS 100, and therefore applies the PBE prefixed paragraphs in FRS 102. 

The financial statements have been prepared on the historical cost basis (except for the revaluation of investments and where cost is deemed to be the revaluation amount at date of transition) and on the accruals basis. 

The financial statements contain the financial information for the Church of England Pensions Board which is structured as follows: 

- Unrestricted Funds - representing expenditure incurred by the Board on salaries and working expenses subsequently recovered in full from the pension funds administered by the Board. 

- Restricted Funds - these funds have narrower purposes than that of the Board. 

A summary of the accounting policies, which have been applied consistently across the Group, is set out below. 

## _**c) Basis of consolidation**_ 

The consolidated statement of financial activities (“SOFA”) and the balance sheet include the financial information of the Board and its subsidiary undertakings (CEPB Mortgages and CHARM Finance plc).  The subsidiaries have been consolidated on a line by line basis.  Intra-group balances and transactions are eliminated on consolidation. 

The Board has chosen not to present its non-consolidated statement of financial activities separately as the numbers are the same as for the consolidated equivalent. The Board has also taken advantage of the exemption conferred by FRS 102 Section 1 not to prepare a charity-only cash flow statement. 

The Board, together with the Archbishops’ Council and the Church Commissioners are equal partners in Church of England Central Services (ChECS), a joint venture. This jointly controlled entity is included in the Board’s consolidated financial statements using the equity method.  The Board’s share of profits or losses from ChECS is included in the SOFA and its share of net assets is included in the balance sheet. 

## _**d) Going concern**_ 

The Board meets the cost of property purchases, fit-outs and other working capital requirements through its external borrowing, comprising a bank facility and two listed bond issues.  The Board prepares annual budgets and regular re-forecasts, along with a three-year financial plan in order to ensure that it can meet its spending commitments as they fall due, and fulfil the terms and conditions associated with external borrowing. In addition, the Board has also prepared a long-term business plan to consider financial viability over a longer period than that for which formal budgets and forecasts are prepared. 

The Board has considered the key risks and uncertainties which impact upon immediate liquidity and longer-term solvency. These include the level of anticipated demand for its services, the resilience of voluntary income streams and changes in economic conditions. It has modelled the impact of changes in these factors over time and has considered whether it has adequate reserves and appropriate contingency plans to deal with a range of potential adverse scenarios. 

The Board has considered the continuing financial impact of inflation, demand and interest rates on its operations and its future obligations and commitments. 

Having due regard to the above, the Trustees have reasonable expectation that the Board has adequate resources to meet its spending commitments as they fall due, including the servicing and repayment of debt and compliance with loan covenants for the period of at least 12 months from the date of approval of these financial statements. Accordingly, the going concern basis of accounting in preparing the annual report and accounts continues to be adopted. 

## _**e) Income**_ 

All income is recognised once the Board has entitlement to the income, it is probable that the income will be received, and the amount of income receivable can be measured reliably. 

_i) Grants, donations and legacies_ Donations are accounted for when received. Grants are recognised when the Board is entitled to receive them and revenue recognition criteria of entitlement, probability and measurement have been met. Gift Aid receivable is included in income when there is a valid declaration from the donor. 

48 



## **Notes to the financial statements of the Church of England Pensions Board for the year ended 31 December 2025** 

## _**1. Accounting policies (continued)**_ 

Pecuniary legacies are recognised as receivable once probate has been granted and notification has been received. Residuary legacies are recognised as receivable once probate has been granted, where sufficient information has been received and are recognised on an estimated basis as follows: cash elements are recognised at monetary value, with property and other assets, including investments, valued at probate or net realisable value. Values are reviewed and, if material, adjusted up to the point of financial statement approval. 

In the case of donated properties, these are valued at market value and recognised within Donations. 

## _ii) Investment income_ 

Income from investments is recognised on an accruals basis. 

## _iii) Income from charitable activities_ 

Income from charitable activities represents rent from rental properties, rent and service charge from shared ownership properties, income from mortgaged properties and fees and service charges from Community Living schemes, which are all recognised on the accruals basis. 

_iv) Other income_ Other income is recognised when the Board is entitled to receive it and revenue recognition criteria of entitlement, probability and measurement have been met. 

## _**f) Expenditure**_ 

All expenditure is accounted for on the accruals basis.  Expenditure and liabilities are recognised when a legal or constructive obligation exists as outlined in Section 7 of FRS 102.  The SOFA has been presented on an activity basis.  Costs have been distinguished between charitable activities and those incurred to raise funds. 

## _i) Charitable activities_ 

Direct costs and grants are allocated directly to activities. Grants payable are recognised when the grant is formally approved by the Board and has been communicated to the recipient. 

_ii) Support costs_ 

Costs include shared service costs (finance, IT, HR, legal, internal audit), department running costs and governance costs.  They are allocated across the charitable activities and raising funds as detailed in notes 4 and 5.  Governance costs relate to the general running of the Board, which include costs associated with the strategic, as opposed to day-to-day, management of the Board’s activities, and compliance with constitutional and statutory requirements. 

## _**g) Pensions**_ 

Staff pensions are described in note 8. Defined benefit schemes are considered to be multi-employer schemes as described in FRS 102 paragraph 28.11 and consequently are accounted for as if they were defined contribution schemes, where employer contributions payable in the year are charged to expenditure. 

Where schemes have deficit recovery contribution plans in place, FRS 102 paragraph 28.11A requires the present value of these agreed payments to be recognised as a liability.  Amounts paid during the year are charged against this liability. 

## _**h) Fixed assets**_ 

Rental properties, shared ownership properties and Community Living properties generate income from the furtherance of the charity’s objects. As such, they are not considered to be investment properties but are classed as tangible fixed assets held at cost. 

Where fixed assets were purchased with significant restrictions as a result of agreements with the funder such that the Board has a right of use of the asset for the lifetime of a beneficiary of the charity but the risks and rewards relating to capital value accrue entirely to the lender, these assets are shown in a separate category. Proceeds on eventual sale of these properties are not accounted for by the Board as they are received as agent for the lender and are used to settle the corresponding liability. 

_i) Rental properties_ Properties are held at original cost or for properties received as gifts, the notional cost equivalent to the market value.  Funding arrangements are explained in note 12. 

Costs relating to the repair and maintenance of properties are charged to the SOFA in the year incurred. 

A depreciation rate of 0% is applied on long leasehold or freehold properties due to the long life and the high residual value of properties which would result in immaterial depreciation for each asset and in aggregate. 

An impairment review is carried out annually and where materially different from historic cost, the properties are carried at recoverable amount (being the higher of fair value less costs to sell and value in use). 

## _ii) Shared ownership properties_ 

These properties are purchased by the Board and the resident buys a 90-year lease for a share in the property (at least 25%) and pays a rent and a service charge on the proportion of the property that they do not own. Residents can purchase further shares in their property if their financial circumstances change, and the equity interests are adjusted accordingly. 

The Board holds each property at its equity percentage of the original cost, subject to an impairment review.  An impairment review is carried out annually and where materially different from historic cost, the Board’s proportion of each property is carried at recoverable amount (being the higher of fair value less costs to sell and value in use). 

49 



## **Notes to the financial statements of the Church of England Pensions Board for the year ended 31 December 2025** 

## _**1. Accounting policies (continued)**_ 

A depreciation rate of 0% is applied on long leasehold or freehold properties due to the long life and the high residual value of properties which would result in immaterial depreciation for each asset and in aggregate. 

## _iii) Community Living properties_ 

The properties and their associated land are held at deemed cost.  Freehold land is not depreciated.  The buildings are depreciated. 

Fixtures, fittings, plant and equipment are held at original cost to the Board less depreciation. 

Depreciation is charged on the following basis: 

|Depreciation is charged on the followingbasis:|||
|---|---|---|
|**_Tangible asset_**|**_Basis_**|**_Rate_**|
|Freehold buildings|Straight line|2.5%per annum|
|Fixtures, fittings, plant and equipment|Straight line|5-50 years following the NHF guidelines for all<br>assets acquired after 2017|



_iv) Programme Related Investments – Mortgage properties_ 

Mortgaged properties were purchased by the Board under a scheme that closed to new business in 2008. These mortgages operate as value linked loans which are classified as concessionary loans in accordance with FRS102. The Board’s equity interest in a property is the amount loaned to the resident (up to 95% of the property value) and the resident’s equity interest is the amount funded directly by the resident.  If a resident pays off part of their loan, the equity interests are adjusted accordingly. 

On the sale of a property, the Board and the resident receive proceeds in the same proportion as their equity interests. 

The Board accounts for each property at its equity percentage of original cost, subject to an impairment review.  An impairment review is carried out annually and where materially different from historic cost, the Board’s proportion of each property is carried at recoverable amount (being the higher of fair value less costs to sell and value in use). 

## _v) Programme related investments – ChECS_ 

Programme related investments are recognised at their initial cost, less any impairments. 

## _vi) Investment properties_ 

Investment properties are held at fair value. Valuations are carried out every year in accordance with the Appraisals & Valuation Manual issued by the Royal Institute of Chartered Surveyors.  No depreciation is charged. 

## _vii) IT systems_ 

_IT systems are held at original cost to the Board less depreciation charged on a straight-line basis over 5 years.  Systems are capitalised while under_ construction until implementation and at that stage depreciation commences. 

_viii) Gains (or losses) from sale of fixed assets_ 

Gains (or losses) resulting from the sale of fixed assets are recognised in income (or expenditure). Gains or losses resulting from the sale and revaluation of investment assets are recognised in the SOFA in a separate section before net income/expenditure. 

## _**i) Loans**_ 

From 1983 until July 2010 most of the rental, shared ownership and mortgage scheme properties purchased were financed by loans from the Church Commissioners, and as these loans were received by the Charity to further its purposes, these loans are classified as concessionary loans. The Board applies the measurements provisions of FRS 102 paragraphs PBE34.90-92 to all its concessionary loans. Loans from the Church Commissioners are measured at the amount received from the Commissioners.  See notes 12 and 13 for more information. 

The loan from Santander is a basic financial instrument and measured at transaction price (less transactions costs). Subsequently, it is measured at amortised cost using the effective interest method. Arrangement fees are deducted from the transaction price and are amortised over 15 years (July 2010 to July 2025). 

The loan from NatWest is a basic financial instrument and measured at transaction price (less transactions costs). Subsequently, it is measured at amortised cost using the effective interest method. Arrangement fees are deducted from the transaction price and are amortised over 5 years (Dec 2024 to Dec 2029). 

The loan from CHARM Finance PLC to the Charity is a basic financial instrument and is measured at transaction price (less transactions costs).  Subsequently, it is measured at amortised cost using the effective interest method. Arrangement fees are deducted from the transaction price and are amortised over the length of the facility. 

The Bond liabilities relate to the corporate bonds issued by CHARM Finance PLC, and are basic financial instruments measured initially at the proceeds of issue less transaction costs directly attributable to the issue of the Bonds. After initial recognition the liabilities are measured at amortised cost using the effective interest method with transaction costs being amortised over the length of the facility. 

## _**j) Financial instruments**_ 

The Board has chosen to adopt sections 11 & 12 of FRS 102 in respect of financial instruments which are not public benefit entity concessionary loans. 

## _**Basic financial instruments**_ 

Listed and unlisted investments are initially measured at fair value.  Such assets are subsequently held at fair value at each balance sheet date.  The changes in fair value are recognised in the SOFA.  The fair value of listed investments is determined using bid price in accordance with the practice of the appropriate stock exchange.  Unlisted investments are valued by reference to latest dealing prices, valuations from reliable sources or net asset values. 

50 



## **Notes to the financial statements of the Church of England Pensions Board for the year ended 31 December 2025** 

## _**1. Accounting policies (continued)**_ 

## _**k) Subsidiary undertakings**_ 

Investment in the Board’s subsidiary companies are held at cost less accumulated impairment losses. 

## _**l) Taxation**_ 

As a registered charity, the Board is exempt from taxation on its income and gains falling within Part 11 of the Corporation Taxation Act 2010 or section 256 of the Taxation of Chargeable Gains Act 1992 to the extent that they are applied to charitable purposes. 

The Board, in common with many other charities, is unable to recover the majority of Value Added Tax (VAT) incurred on expenditure.  The amount of VAT that cannot be recovered is included in the underlying cost to which it relates. 

## _**m) Related parties**_ 

The Church of England comprises a large number of legally independent bodies in its parishes, cathedrals and dioceses as well as at national level.  These bodies are not related to the Board as defined in the Charities SORP or chapter 33 of FRS 102: Related parties disclosures.  Transactions and balances with these bodies are accounted for in the same way as other transactions and, where material, are separately identified in the notes to the financial statements. The Church of England Pensions Board is related to ChECS, as it is a partner in this joint venture. Details are given in Note 18. 

## _**n) Funds**_ 

In line with the SORP, the Board segregates its funds between those that are restricted and those that are unrestricted. 

Unrestricted funds are funds received by the Board that are available for use at the discretion of the Board in pursuing the general charitable objectives of the charity. 

Restricted funds are funds received by the Board for particular purposes and are to be used in accordance with those purposes. An analysis of restricted funds is provided in note 16. 

## _**o) Significant judgements and estimates**_ 

The Board’s key judgements, which have a significant effect on the amounts recognised in the financial statements, are described in the accounting policies and are summarised below: 

• Carrying value of tangible assets – judgements in respect of the depreciation policies and impairment considerations undertaken for the assets of the Charity. Further details are disclosed in notes 9 to 12. 

The Board’s key estimates, which have a significant effect on the amounts recognised in the financial statements, are described in the accounting policies and are summarised below: 

• Residuary legacies - estimation required for residuary legacies receivable once probate has been granted. 

• Pension deficit provision - estimations surrounding the methodology used in the calculation of the Charity’s defined benefit pension deficit provision. Further details are disclosed in note 8. 

• Support costs – estimation surrounding the methodology used in the apportionment of support costs between the restricted and unrestricted funds. 

• Investment properties – estimation surrounding the valuation methodology used in determining the fair value of these properties. 

## _**2. Income from grants, donations and legacies**_ 

|Note<br>Grants from:<br>The Archbishops' Council<br>4<br>Other grants|**2025**<br>**£’000**<br>6,643<br>142|**2024**|
|---|---|---|
|||**£’000**<br>25,952<br>23|
|`Total grants|6,785|25,975|
|Donations<br>Legacies|31<br>322|36<br>174|
|**Total income from grants, donations and legacies**|**7,138**|**26,185**|



The Archbishops’ Council makes grants from money provided by the dioceses under the General Synod Vote 5, towards the costs of the Retirement Housing schemes. All income from grants, donations and legacies was attributable to restricted funds. 

51 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

_**3. Investment income**_ 

|**_3._**<br>**_Investment income_**|||
|---|---|---|
|Note<br>Dividends<br>Rental income from investment properties<br>Interest on cash<br>Income from partnerships<br>10|**2025**<br>**£’000**<br>1,666<br>12<br>109<br>111|**2024**|
|||**£’000**<br>2,074<br>11<br>60<br>991|
|**Total income from investments**|**1,898**|**3,136**|



All income from investments of £1,898,000 (2024: £3,136,000) was attributable to restricted funds. 

52 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

## _**4. Charitable activities**_ 

|**Notes**<br>**Income from charitable**<br>**activities:**<br>Rent received<br>Service charge received<br>Income from mortgage<br>properties<br>Support costs recharge|**Rental**<br>**proper**<br>**ties**<br>**Shared**<br>**owners**<br>**hip**<br>**Mortgage**<br>**properties**<br>**Community**<br>**Living**<br>**Other**<br>**charitable**<br>**activities**<br>**Total**<br>**restricted**<br>**funds**<br>**Unrestricted**<br>**Pension**<br>**Schemes**<br>**2025**<br>**Total**<br>**£’000**<br>**£’000**<br>**£’000**<br>**£’000**<br>**£’000**<br>**£’000**<br>**£’000**<br>**£’000**<br>8,676<br>536<br>-<br>1,807<br>-<br>**11,019**<br>-<br>**11,019**<br>-<br>-<br>-<br>3,042<br>-<br>**3,042**<br>-<br>**3,042**<br>-<br>-<br>1,807<br>-<br>-<br>**1,807**<br>-<br>**1,807**<br>-<br>-<br>-<br>-<br>-<br>**-**<br>14,031<br>**14,031**<br>8,676<br>536<br>1,807<br>4,849<br>-<br>**15,868**<br>14,031<br>**29,899**<br>6,416<br>457<br>1,753<br>-<br>-<br>**8,626**<br>-<br>**8,626**<br>-<br>-<br>-<br>-<br>80<br>**80**<br>-<br>**80**<br>7,939<br>31<br>157<br>89<br>-<br>**8,216**<br>-<br>**8,216**<br>2,972<br>991<br>661<br>1,982<br>-<br>**6,606**<br>14,031<br>**20,637**<br>96<br>-<br>-<br>-<br>-<br>**96**<br>-<br>**96**<br>-<br>99<br>-<br>3,245<br>-<br>**3,344**<br>-<br>**3,344**<br>-<br>-<br>-<br>58<br>-<br>**58**<br>-<br>**58**<br>-<br>-<br>-<br>831<br>-<br>**831**<br>-<br>**831**<br>-<br>-<br>-<br>1,287<br>-<br>**1,287**<br>-<br>**1,287**<br>**17,423**<br>**1,578**<br>**2,571**<br>**7,492**<br>**80**<br>**29,144**<br>14,031<br>**43,175**<br>**0.45**<br>**0.15**<br>**0.1**<br>**0.3**<br>**-**<br>**-**<br>**-**<br>**-**<br>**-**<br>**-**<br>**-**<br>**-**<br>**17,423**<br>**1,578**<br>**2,571**<br>**7,492**<br>**80**<br>**29,144**<br>**14,031**<br>**43,175**|**2024**<br>**Total**|
|---|---|---|
|||**£’000**<br>**10,948**<br>**2,946**<br>**1,959**<br>**13,634**|
|**Total income from**<br>**charitable activities**||**29,487**|
|**Expenditure on**<br>**charitable activities:**<br>Financing costs (interest<br>and commitment fee)<br>Grant making<br>Property costs (repairs,<br>insurance and other<br>costs)<br>Support costs<br>6<br>Amortisation of<br>arrangement fees<br>Service charge costs<br>Nursing care costs<br>(former residents)<br>Community Living and<br>other direct costs<br>Depreciation and<br>impairment charges<br>11||**8,648**<br>**79**<br>**8,201**<br>**18,852**<br>**66**<br>**3,145**<br>**97**<br>**877**<br>**1,180**|
|**Total expenditure on**<br>**charitable activities**||**41,145**|
||||
|**Unwinding of pension**<br>**deficit on charitable**<br>**activities**||**-**|
||||
|**Total expenditure**<br>**including pension deficit**<br>**movement in year**||**41,145**|



53 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

## _**4. Charitable activities (continued)**_ 

For comparative purposes, details of 2024 charitable income and expenditure are set out below: 

|**Notes**<br>**Income from charitable**<br>**activities:**<br>Rent received<br>Service charge received<br>Income from mortgage<br>properties<br>Support costs recharge|**Rental**<br>**properties**<br>**Shared**<br>**ownership**<br>**Mortgage**<br>**properties**<br>**Community**<br>**Living**<br>**Other**<br>**charitable**<br>**activities**<br>**Total**<br>**restricted**<br>**funds**<br>**Unrestricted**<br>**funds**<br>**Pension**<br>**Schemes**<br>**2024**<br>**Total**|
|---|---|
||**£’000**<br>**£’000**<br>**£’000**<br>**£’000**<br>**£’000**<br>**£’000**<br>**£’000**<br>**£’000**<br>8,684<br>545<br>-<br>1,719<br>-<br>**10,948**<br>-<br>**10,948**<br>-<br>99<br>-<br>2,847<br>-<br>**2,946**<br>-<br>**2,946**<br>-<br>-<br>1,959<br>-<br>-<br>**1,959**<br>-<br>**1,959**<br>-<br>-<br>-<br>-<br>-<br>**-**<br>13,634<br>**13,634**|
|**Total income from**<br>**charitable activities**|**8,684**<br>**644**<br>**1,959**<br>**4,566**<br>**-**<br>**15,853**<br>13,634<br>**29,487**|
|**Expenditure on charitable**<br>**activities:**<br>Financing costs (interest<br>and commitment fee)<br>Grant making<br>Property costs (repairs,<br>insurance and other costs)<br>Support costs<br>6<br>Amortisation of<br>arrangement fees<br>Service charge costs<br>Nursing care costs<br>(former residents)<br>Community Living and<br>other direct costs<br>Depreciation and<br>impairment charges<br>10|6,286<br>461<br>1,901<br>-<br>-<br>**8,648**<br>-<br>**8,648**<br>-<br>-<br>-<br>-<br>79<br>**79**<br>-<br>**79**<br>7,873<br>19<br>198<br>111<br>-<br>**8,201**<br>-<br>**8,201**<br>2,348<br>783<br>522<br>1,565<br>-<br>**5,218**<br>13,634<br>**18,852**<br>66<br>-<br>-<br>-<br>-<br>**66**<br>-<br>**66**<br>-<br>19<br>-<br>3,126<br>-<br>**3,145**<br>-<br>**3,145**<br>-<br>-<br>-<br>97<br>-<br>**97**<br>-<br>**97**<br>-<br>-<br>-<br>877<br>-<br>**877**<br>-<br>**877**<br>-<br>-<br>-<br>1,180<br>-<br>**1,180**<br>-<br>**1,180**|
|**Total expenditure on**<br>**charitable activities**|**16,573**<br>**1,282**<br>**2,621**<br>**6,956**<br>**79**<br>**27,511**<br>13,634<br>**41,145**|
|||
|**Unwinding of pension**<br>**deficit on charitable**<br>**activities**|**-**<br>**-**<br>**-**<br>**-**<br>**-**<br>**-**<br>**-**<br>**-**|
|||
|**Total expenditure**<br>**including pension deficit**<br>**movement in year**|**16,573**<br>**1,282**<br>**2,621**<br>**6,956**<br>**79**<br>**27,511**<br>**13,634**<br>**41,145**|



## **Income & Expenditure from charitable activities:** 

The deficit on charitable activities is funded through a combination of specific and general voluntary income, investment income, and realised gains on disposal of investments and property.  In the year ended 31 December 2025 grants of £6,642,953 were received from the Archbishops' Council towards the Retirement Housing schemes (2024: £25,952,100). In addition, the Board's broader charitable activities were funded through voluntary income of £495,315 (2024: £234,000), Investment income of £1,898,000(2024: £3,136,000) and gains on disposal of property of £3,032,614 (2024: £4,865,000). 

## _**Rental Properties**_ 

The Archbishops’ Council, from money provided by the dioceses under the General Synod Vote 5 and distributions it receives from the Church Commissioners, makes grants towards the costs of the rental scheme. 

Rent from tenancies starting after 1 April 2015 are target rents based on the value of the property and are subsidised so that they are more affordable than market rents. Rent from tenancies before this are based on the occupant’s ability to pay.  Residents pay for moving costs, furnishings and white goods, contents insurance and on-going utility and council tax costs.  The Board pays for repairs and on-going maintenance of the properties. 

54 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

## _**4. Charitable activities (continued)**_ 

There are a small number of properties that are let on the open market at market rents during short periods when a property is not occupied by residents eligible for the rental scheme.  At 31 December 2025 there were 8 (2024: 17) such tenancies. 

All tenancies fall into the definition of operating leases as set out in FRS 102 section 20 and clarified in the Housing SORP 2014 paragraph 10.3 (which though the Board does not apply, it does look to this guidance for clarification where the Charities SORP and FRS 102 are silent on particular issues). All tenancies are cancellable, either on death or notice of the resident and are not assignable. 

## _**Shared Ownership**_ 

Residents pay rent based on the Board’s share of the ownership of the property and the cost of buildings insurance. 

For some properties bought before 1 April 2014, residents also pay a service charge towards the repairs and maintenance of properties.  For properties bought after 1 April 2014, or where residents have opted, the responsibility for repairs and maintenance lies with the resident. 

## _**Mortgage Properties**_ 

The mortgage scheme offered value linked loans to retired clergy and closed to new business in 2008.  Mortgagees pay an interest-only amount on the capital advanced. 

A small number of loans pre-dating the 1983 CHARM mortgage scheme remain, where a fixed amount of interest is paid based on the capital advanced.  At 31 December 2025, the number of such loans in place was 2 (2024: 2). 

## _**Community Living**_ 

Some residents in the schemes receive subsidies from the Board’s charitable funds. The cost of running the schemes is not met fully by rent and service charge fees.  The nursing home closed in March 2017 however the Board continues to subsidise the nursing care of former residents of the nursing home. The operating deficit is met from the Board’s charitable funds. 

## _**Other charitable activities**_ 

Grants are payable to augment the income of those retired clergy and clergy widow(er)s whose income falls below a certain standard, which is reviewed annually. 

## _**5. Raising funds**_ 

|**_5._**<br>**_Raising funds_**|||
|---|---|---|
|Investment management costs (direct costs)|**2025**<br>**£’000**<br>116|**2024**|
|||**£’000**<br>83|
|**Total cost of raising funds**|**116**|**83**|



## _**6. Support costs**_ 

Support costs include department running costs and governance costs, plus charges for using shared services operated by ChECS.  They are included in charitable expenditure (note 4) and are apportioned to the various charitable activities to which they relate. 

||||**Restricted funds**|||**Unrestricted**<br>**funds**|**Total**|
|---|---|---|---|---|---|---|---|
||**Rental**<br>**properties**|**Shared**<br>**ownership**|**Mortgage**<br>**properties**|**Community**<br>**Living**|**Total**|**Pension**<br>**schemes**|**2025**|
||**£’000**|**£’000**|**£’000**|**£’000**|**£’000**|**£’000**|**£’000**|
|Housing department|1,992|664|443|1,328|**4,427**|-|**4,427**|
|Executive and Secretariat|196|65|44|131|**436**|455|**891**|
|Governance costs|89|30|20|60|**199**|263|**462**|
|Pensions department|-|-|-|-|**-**|8,075|**8,075**|
|Investments department|-|-|-|-|**-**|3,627|**3,627**|
|Shared services|695|232|154|463|**1,544**|1,611|**3,155**|
|**Total support costs**|**2,972**|**991**|**661**|**1,982**|**6,606**|**14,031**|**20,637**|



55 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

## _**6. Support costs (continued)**_ 

For comparative purposes, details of 2024 support costs are set out below: 

||||**Restricted funds**|**Restricted funds**||**Unrestricted**|**Total**|
|---|---|---|---|---|---|---|---|
|||||||**funds**||
||**Rental**|**Shared**|**Mortgage**|**Community**|**Total**|**Pension**|**2024**|
||**properties**|**ownership**|**properties**|**Living**||**schemes**||
||**£’000**|**£’000**|**£’000**|**£’000**|**£’000**|**£’000**|**£’000**|
|Housing department|1,428|476|317|952|**3,173**|-|**3,173**|
|Executive and Secretariat|197|66|44|131|**438**|532|**970**|
|Governance costs|83|28|18|56|**185**|245|**430**|
|Pensions department|-|-|-|-|**-**|7,702|**7,702**|
|Investments department|-|-|-|-|**-**|3,428|**3,428**|
|Shared services|640|213|143|426|**1,422**|1,727|**3,149**|
|**Total support costs**|**2,348**|**783**|**522**|**1,565**|**5,218**|**13,634**|**18,852**|



## _**Housing department costs**_ 

These costs are allocated on a ‘per head’ basis: costs of housing staff are allocated 45% to rental properties, 30% to Community Living schemes, 10% to mortgages and 15% to shared ownership. 

## _**Executive and Secretariat and shared service costs**_ 

Centrally incurred management and shared service costs are allocated between pension schemes and the charity on a ‘per head’ basis.  The charity’s housing share is then allocated 45% to rental properties, 30% to Community Living schemes, 10% to mortgages and 15% to shared ownership. 

## _**Governance costs**_ 

Governance costs comprise staff and non-staff costs relating to the general running of the Board, including supporting the work of the Board and its Committees. Trustees (and co-opted members) of the Board are reimbursed for travel expenses incurred whilst on official business but are not entitled to any other remuneration or allowances. In the year to 31 December 2025, 6 (2024: 8) Trustees claimed a total of £6,180 (2024: £5,247). Governance costs other than external audit costs are allocated between pension schemes and the charity on a ‘per head’ basis.  The charity’s housing share is then allocated 45% to rental properties, 30% to Community Living schemes and nursing care, 10% to mortgages and 15% to shared ownership. 

|External audit (including VAT)<br>Internal audit<br>Board and committee meetings|**2025**<br>**£’000**<br>88<br>111<br>27|**2024**|
|---|---|---|
|||**£’000**<br>83<br>101<br>35|
|**Total governance costs**|**226**|**219**|



Total fees paid (excluding VAT) to Crowe U.K. LLP are shown below: 

|Audit of CEPB and its subsidiary undertakings|**2025**<br>**£’000**<br>72|**2024**|
|---|---|---|
|||**£’000**<br>69|
|**Total audit fees relating to current year for CEPB and its subsidiaries**|**72**|**69**|
|Audit of Pension Schemes|**123**|**115**|
|**Total audit fees relating to current year for Pension Schemes**|**123**|**115**|



## _**Pensions department costs**_ 

Expenses are incurred by the Board for administering the pension schemes.  These costs are recovered from the pension schemes by charging an administration fee to each scheme. 

## _**Investment department costs**_ 

Expenses are incurred by the Board for managing the investment portfolio of the Church of England Investment Fund for Pensions through which the pension schemes hold investments.  These costs are recovered by the Board as part of the administration fee the Board charges each pension scheme. 

## _**Shared service costs**_ 

Shared services are provided by Church of England Central Services.  Expenses incurred by the Board for administering the Pension Funds are either charged directly to the activity to which they relate or are allocated to the funds in proportion to staff costs, number of data processes or other relevant criteria. 

56 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

## _**7. Staff numbers and costs**_ 

The Chief Executive and staff employed to work in the investment team and the Community Living schemes are employed directly by the Board. The Board is joint employer, together with the other National Church Institutions (the NCIs), of most of the staff of the NCIs. In addition to staff employed directly, the work of the Board is supported by staff in shared service departments who provide finance, HR, communications, legal, IT and internal audit services.  Since 1 April 2014 they have been employed by a separate NCI, Church of England Central Services (ChECS). 

The SORP requires that the costs of staff employed by third parties who operate on the organisation’s behalf be disclosed in the financial statements.  In order to comply with the spirit of the SORP, the costs of all ChECS staff are shown in aggregate in the tables below – the Board’s share of which was £2,066,000 (2024: £1,843,000). The cost of staff for which the Board is the managing employer and for ChECS (in aggregate) was: 

||||**Pensions Board**|**Pensions Board**|**own staff**||||||**ChECS**|**ChECS**|
|---|---|---|---|---|---|---|---|---|---|---|---|---|
||**Housing**||**Pensions and**<br>**Investments**||**Secretariat**||**Community**|**Living**|**Total**||**Shared**|**services**|
||**2025**|**2024**|**2025**|**2024**|**2025**|**2024**|**2025**|**2024**|**2025**|**2024**|**2025**|**2024**|
|Average number<br>employed|**49**|40|**54**|52|**5**|6|**83**|86|**191**|184|218|211|
||**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|
|Salaries|**2,502**|2,051|**4,388**|4,066|**483**|531|**1,825**|1,763|**9,198**|8,411|**11,857**|11,044|
|National<br>Insurance costs|**320**|232|**590**|497|**64**|66|**195**|146|**1,169**|941|**1,591**|1,272|
|Pension<br>contributions|**352**|284|**605**|538|**67**|73|**217**|237|**1,241**|1,132|**1,718**|1,466|
|**Total cost of staff**|**3,174**|2,567|**5,583**|5,101|**614**|670|**2,237**|2,146|**11,608**|10,484|**15,166**|13,782|
|**Total chargeable**|||||||||||||
|**to Charitable**|**3,174**|2,567|**-**|**-**|**300**|302|**2,237**|2,146|**5,711**|5,015|||
|**Funds**|||||||||||||



57 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

## _**7. Staff numbers and costs (continued)**_ 

There were redundancy costs paid in the year of £33,621 (2024: £Nil) to 1 individual (2024: Nil) for restructuring. Restructuring costs are accounted for in full in the year in which the restructure is announced. The number of staff whose total employee benefits for the year fell in the following bands were: 

|£60,001 to<br>£70,000<br>£70,001 to<br>£80,000<br>£80,001 to<br>£90,000<br>£90,001 to<br>£100,000<br>£100,001 to<br>£110,000<br>£110,001 to<br>£120,000<br>£120,001 to<br>£130,000<br>£130,001 to<br>£140,000<br>£140,001 to<br>£150,000<br>£150,001 to<br>£160,000<br>£160,001 to<br>£170,000<br>£170,001<br>to £180,000<br>£180,001<br>to £190,000<br>£190,001<br>to £200,000<br>£200,001<br>to £210,000<br>£210,001<br>to £220,000<br>£220,001<br>to £230,000<br>£230,001<br>to £240,000<br>£240,001<br>to £250,000<br>£250,001<br>to £260,000<br>£260,001<br>to £270,000<br>£270,001<br>to £280,000|**Pensions Board own staff**<br>**Housing**<br>**Pensions and**<br>**Investments**<br>**Secretariat**<br>**Community Living**<br>**2025**<br>**2024**<br>**2025**<br>**2024**<br>**2025**<br>**2024**<br>**2025**<br>**2024**<br>8<br>5<br>10<br>8<br>-<br>1<br>1<br>1<br>1<br>2<br>6<br>4<br>-<br>-<br>1<br>-<br>4<br>2<br>2<br>4<br>1<br>1<br>-<br>-<br>-<br>-<br>3<br>1<br>-<br>-<br>-<br>-<br>-<br>1<br>1<br>1<br>-<br>-<br>-<br>-<br>1<br>-<br>1<br>-<br>-<br>1<br>-<br>-<br>-<br>-<br>1<br>2<br>-<br>-<br>-<br>-<br>-<br>-<br>1<br>2<br>1<br>-<br>-<br>-<br>-<br>-<br>1<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>1<br>2<br>-<br>-<br>-<br>-<br>-<br>-<br>1<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>1<br>1<br>-<br>-<br>-<br>-<br>-<br>-<br>1<br>-<br>1<br>1<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>1<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>1<br>-<br>-<br>-<br>-<br>-<br>-<br>2<br>-<br>-<br>-<br>-<br>-|**ChECS**|
|---|---|---|
|||**Shared services**<br>**2025**<br>**2024**<br>31<br>19<br>14<br>14<br>8<br>4<br>5<br>7<br>4<br>3<br>4<br>5<br>3<br>1<br>4<br>1<br>-<br>1<br>1<br>1<br>-<br>-<br>1<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-<br>-|



Employee benefits include gross salaries and termination payments but do not include employer pension contributions and employer National Insurance contributions. 

Most staff above were members of the Church Administrators Pension Fund. Of those directly managed by the Board, 33 (2024: 27) staff accrued benefits under a defined contributions scheme for which contributions for the year were £376,122 (2024: £295,374). The other 4 (2024: 3) staff accrued benefits under a defined benefit scheme. 

Of those managed by ChECS, 44 (2024:46) staff accrue benefits under a defined contribution scheme for which contributions for the year were £535,000 (2024: £509,000), 6 (2024:5) staff members accrue benefits under a defined benefit scheme, and 23 (2024: 3) staff members accrue benefits under the Church Workers Pension Fund scheme. 

Of the remaining staff managed directly by the Board, 12 (2024: 11) staff accrued benefits in the Church Workers Pension Fund under a ‘cash-balance’ scheme for which contributions for the year were £274,437 (2024: £227,915), and 1 staff members (2024: 1 staff member) accrued no benefits in any pension scheme. 

The highest paid member of staff earned £275,871 (2024: £267,111).  Further details of the Board’s remuneration policy are included in the Management section of the Board’s report, on page 35. The Board’s executive leadership team comprises 9 individuals (2024: 9), 7 (2024: 7) of whom are employed directly by the Board and 2 (2024: 2) by ChECS. The aggregate remuneration for these 9 individuals, including National Insurance and pension contributions, was £1,846,472 (2024: £1,712,000). Interest free loans are made for travel season tickets and interest free green travel loans for the purchase of bicycles and electric scooters. 

58 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

## _**8. Staff pensions**_ 

_Pension benefits from Service up to 31 December 1999_ 

These are met by the Church Commissioners for England, so no costs or liability are reflected by the Board. 

_Pension benefits from Service from 1 January 2000_ 

Benefits for staff arising from service from 1 January 2000 are generally provided by the Church Administrators Pension Fund (“CAPF”).  Some jointly employed staff and PB directly employed staff are typically members of the Church Workers Pension Fund (“CWPF”). 

## _**Staff who are members of the CAPF Pension Scheme**_ 

The participating employers are responsible for making contributions of £650,000(2024: £650,000) towards the administration costs of the CAPF. The Board’s share of these costs was £97,664 (2024: £94,500). 

Staff who were in service as at 30 June 2006 are members of the defined benefit section of the CAPF.  This is considered to be a multi-employer scheme as described in FRS 102 paragraph 28.11 and consequently is accounted for as if it were a defined contribution scheme, where employer contributions payable in the year are charged to expenditure. 

The contributions to the CAPF are assessed by an independent qualified actuary using the projected unit method of valuation. A valuation of the scheme is carried out once every three years, the most recent having been carried out as at 31 December 2022. This revealed a deficit of £2.4m for the entire scheme. As agreed prior to the valuation, the employers collectively paid contributions of 27.6% of Pensionable Salaries each month and deficit payments of £2.4m until December 2023, in respect of the shortfall in the scheme. As at 31 December 2025, there is no deficit in relation to the Defined Benefit Section. Future contributions of Pensionable Salaries from 01 January 2024 onwards has been agreed to be 16.5%. 

The provision provided for the shortfall in the scheme is measured at its net present value.  The table below shows the movement on the provision: 

||**CEPB staff**|**Share of ChECS staff**|**2025**|**CEPB staff**|**Share of ChECS staff**|**2024**|
|---|---|---|---|---|---|---|
|Provision at 1 January|-|-|**-**|-|-|**-**|
|Contributions Paid|-|-|**-**|-|-|**-**|
|Interest charged on|||||||
|provision|-|-|**-**|-|-|**-**|
|Adjustment to net present|||||||
|value of provision|-|-|**-**|-|-|**-**|
|**Provision at 31 December**|**-**|**-**|**-**|**-**|**-**|**-**|



Staff who joined after 20 June 2006 are members of the defined contributions section of the CAPF.  Employer contributions payable in the year are charged to expenditure. 

## _**Staff who are members of the CWPF Pension Scheme**_ 

Pension benefits for staff in managerial positions of the Community Living schemes are provided for by a defined benefit section of the Church Workers Pension Fund (“CWPF”).  The scheme is considered to be a multi-employer scheme as described in FRS 102 paragraph 28.11 and consequently is accounted for as if it were a defined contribution scheme, where employer contributions payable in the year are charged to expenditure. 

The contributions to the Fund are assessed by an independent qualified actuary using the projected unit method of valuation.  The last full valuation of the Fund, as at 31 December 2022, showed there is no more deficit. There is no deficit recovery needed from each participating employer in the scheme from 2025. 

Pension benefits for other staff are provided for by a cash-balance or deferred annuity scheme in CWPF, where employer contributions payable in the year are charged to expenditure. 

59 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

## _**9. Investment assets**_ 

|**GROUP**|**At 1 January**<br>**2025**|**Additions**|**Disposals**|**Gains/(losses)**|**Gains/(losses)**|**Cash**<br>**movements**|**At 31 December**<br>**2025**|
|---|---|---|---|---|---|---|---|
||**£'000**|**£'000**|**£'000**||**£'000**|**£'000**|**£'000**|
|UK investment funds|41,295|-|-||1,772|(63)|**43,004**|
|UK investment properties|869|-|-||30|-|**899**|
|**Consolidated total investment assets**|**42,164**|**-**|**-**||**1,802**|**(63)**|**43,903**|
|**CHARITY**|**At 1 January**<br>**2025**|**Additions**|**Disposals**|**Gains/(losses)**||**Cash**<br>**movements**|**At 31 December**<br>**2025**|
||**£'000**|**£'000**|**£'000**||**£'000**|**£'000**|**£'000**|
|UK investment funds|41,295|-|-||1,772|(63)|**43,004**|
|UK investment properties|869|-|-||30|-|**899**|
|Investment in subsidiary|13|-|-||-|-|**13**|
|**Charity's total investment assets**|**42,177**|**-**|**-**||**1,802**|**(63)**|**43,916**|
|Funds were managed by Savills, Swiss Life|and Brewin Dolphin. Investment funds were held as follows:|||||||
|||||||**2025**|**2024**|
|||||||**£'000**|**£'000**|
|Savills||||||19,441|<br>19,190|
|Swiss Life||||||7,497|7,354|
|Brewin Dolphin||||||16,066|14,751|
|**Total**||||||**43,004**|**41,295**|



## **Subsidiaries** 

The Board owned 100% of CEPB Developments Ltd, a dormant company limited by shares, held originally to undertake property and building development at the Community Living schemes and nursing home.  This company was dissolved and removed from the Register on 7th January 2025. 

The Board owns 100% of CEPB Mortgages Ltd, a company limited by guarantee, held to administer mortgages on behalf of the Board.  The company is registered at 29 Great Smith Street, London, SW1P 3PS. 

The Board also owns 100% of CHARM Finance PLC, a company limited by share capital of £50,000 (of which £12,500 has been paid up by the Board), held as a special purpose vehicle which in August 2015 provided £70m of funds to the Board via the issue of £100m of 3.126% Secured Bonds (including £30m in principal amount of Retained Bonds) due August 2048. In April 2018 CHARM Finance PLC provided a further £30m of funds to the Board via the issue of £50m of 3.509% Secured Bonds (including £20m in principal amount of Retained Bonds) also due in 2048. These funds are being used to secure current and future obligations for clergy housing in retirement. 

The financial results of the Subsidiaries are detailed in Note 17. 

## **UK investment properties** 

The valuers of the investment properties were Savills LLP. 

The Pensions Board has no associated undertakings. 

60 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

## _**10. Programme related investments**_ 

The Board’s programme related investments comprise of concessionary loans provided under the mortgage scheme up until 2008, and the investment in the ChECS joint venture. 

ChECS is a charitable joint venture between the Church Commissioners, the Archbishops’ Council and the Church of England Pensions Board, who are equal partners. The purpose of ChECS is to enhance the efficiency and effectiveness of the charitable national and diocesan institutions of the Church of England and of other charities with a church ethos, by facilitating the provision of cost-effective shared financial, legal and other services. The charity was registered with the Charity Commission on 31 December 2013 and started operating from 1 April 2014. 

On 1 January 2024, ChECS became a sole member of Parish Giving Scheme (PGS). PGS is a charitable organisation with over 88,000 givers in 35 dioceses who give approximately £100m a year to over 5,500 parishes. As a result, the net surplus has been apportioned equally amongst the joint partners of ChECS. 

|**GROUP**|**At 1 January**<br>**2025**|**Additions**|**Disposals**|**Gains/(losses)**|**Impairment**|**At 31 December**<br>**2025**|
|---|---|---|---|---|---|---|
||**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|
|Mortgaged properties (Funded by CC)|20,704|-|(2,135)|-|-|**18,569**|
|Mortgaged properties (Funded by PB)|566|-|(83)|-|-|**483**|
|ChECS Joint Venture|991|-|-|111|-|**1,102**|
|**Consolidated total investment assets**|**22,261**|**-**|**(2,218)**|**111**|**-**|**20,154**|
|**CHARITY**|**At 1 January**<br>**2025**|**Additions**|**Disposals**|**Gains/(losses)**|**Impairment**|**At 31 December**<br>**2025**|
||**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|
|Mortgaged properties (Funded by CC)|16,254|-|(2,110)|-|-|**14,144**|
|Mortgaged properties (Funded by PB)|159|-|-|-|-|**159**|
|ChECS Joint Venture|991|-|-|111|-|**1,102**|
|**Consolidated total investment assets**|**17,404**|**-**|**(2,110)**|**111**|**-**|**15,405**|



During the year, there were sale/redemptions totalling 45 (2024: 44) CC funded mortgage properties and 1 (2024: 1) PB funded mortgage property. As at 31 December 2025, there were 316 (2024: 361) CC funded mortgage properties and 7 (2024: 8) PB funded mortgage properties remaining within the charity group. 

As at 31 December 2025, £541,000 was owed by the Board to ChECS (2024: £886,000 owed by the Board to ChECS) representing amounts loaned to ChECS by the Board, and amounts owed to ChECS for services rendered during the year. 

61 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

## _**11. Tangible assets – Community Living and IT systems**_ 

|**Consolidated and charity**|At 1 January<br>2025|Additions|Disposals|<br>Charge in<br>year|Impairment|At 31 December<br>2025|
|---|---|---|---|---|---|---|
||£’000|£’000|£’000|<br>£’000|£’000|£’000|
|_Community Living land and buildings_|||||||
|Cost|25,785|-|-|<br>-|-|**25,785**|
|Depreciation|(5,783)|-|-|<br>(507)|-|**(6,290)**|
|Net book value|20,002|-|-|<br>(507)|-|**19,495**|
|_Fixtures and fittings_|||||||
|Cost|6,791|1,349|-|<br>-|-|**8,140**|
|Depreciation|(3,725)|-|-|<br>(229)|-|**(3,954)**|
|Net book value|3,066|1,349|-|<br>(229)|-|**4,186**|
|_IT systems_|||||||
|Cost|3,715|-|-|<br>-|-|**3,715**|
|Depreciation|(2,639)|-|-|<br>(551)|-|**(3,190)**|
|Net book value|1,076|-|-|<br>(551)|-|**525**|
|Total Community Living and IT<br>systems|24,144|1,349|-|<br>(1,287)|-|**24,206**|



IT systems represents the capitalised costs incurred in respect of the construction of the new Housing Management System and a major upgrade to the Pensions Administration System.  . 

## _**12. Tangible assets – Rental and Shared Ownership**_ 

The Board owns a number of different types of properties which it uses to fulfil its charitable objective: to provide retirement housing for retired clergy. 

||||||_No. of_|||_No. of_|
|---|---|---|---|---|---|---|---|---|
||Book value at|||Book value at|_properties_|||_properties_|
|**Consolidated**|1 January|Additions|Disposals|31 December|_at 1_|_Additions_|_Disposals_|_at 31_|
||2025|||2025|_January_|||_December_|
||||||_2025_|||_2025_|
||£’000|£’000|£’000|£’000|||||
|**Rental properties**|||||||||
|Funded by CC|17,140|-|(2,027)|15,113|171|-|(22)|149|
|Funded by PB|196,771|8,711|(2,897)|202,585|994|30|(20)|1,004|
|**Rental properties total**|**213,911**|**8,711**|**(4,924)**|**217,698**|**1,165**|**30**|**(42)**|**1,153**|
|**Shared ownership properties**|||||||||
|Funded by CC|2,528|-|(76)|2,452|29|-|(1)|28|
|Funded by PB|5,111|-|(359)|4,752|55|-|(4)|51|
|**Shared ownership properties total**|**7,639**|**-**|**(435)**|**7,204**|**84**|**-**|**(5)**|**79**|
|**Totals**|||||||||
|_Properties with significant restrictions_<br>_(funded by Church Commissioners)_|<br>19,668|_-_|(2,103)|17,565|200|-|(23)|177|
|_Properties without significant_|||||||||
|_restrictions (funded by the Pensions_|201,882|8,711|(3,256)|207,337|1,049|30|(24)|1,055|
|_Board)_|||||||||
|**Total**|**221,550**|**8,711**|**(5,359)**|**224,902**|**1,249**|**30**|**(47)**|**1,232**|



62 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

_**12.    Tangible assets – Rental and Shared Ownership**_ 

|**Charity Only**|Book<br>value at 1<br>January<br>2025|Additions|Disposals|Book value<br>at 31<br>December<br>2025|_No. of_<br>_properties_<br>_at 1_<br>_January_<br>_2025_|_Additions_|_Disposals_|_No. of_<br>_properties_<br>_at 31_<br>_December_<br>_2025_|
|---|---|---|---|---|---|---|---|---|
||£’000|£’000|£’000|£’000|||||
|**Rental properties**|||||||||
|Funded by CC|17,140|-|(2,027)|15,113|171|-|(22)|149|
|Funded by PB|196,771|8,711|(2,897)|202,585|994|30|(20)|1,004|
|**Rental properties total**|**213,911**|**8,711**|**(4,924)**|**217,698**|**1,165**|**30**|**(42)**|**1,153**|
|**Shared ownership properties**|||||||||
|Funded by CC|2,528|-|(76)|2,452|29|-|(1)|28|
|Funded by PB|5,111|-|(359)|4,752|55|-|(4)|51|
|**Shared ownership properties total**|**7,639**|**-**|**(435)**|**7,204**|**84**|**-**|**(5)**|**79**|
|**Totals**|||||||||
|_Properties with significant restrictions_<br>_(funded by Church Commissioners)_|<br>19,668|_-_|(2,103)|17,565|200|-|(23)|177|
|_Properties without significant_|||||||||
|_restrictions (funded by the Pensions_|201,882|8,711|(3,256)|207,337|1,049|30|(24)|1,055|
|_Board)_|||||||||
|**Total**|**221,550**|**8,711**|**(5,359)**|**224,902**|**1,249**|**30**|**(47)**|**1,232**|



_Loans made by the Board to CEPB Mortgages Ltd, but ultimately funded by CC, are reflected in current debtors. See note 13._ 

## _**Financing and restriction**_ 

Historically, the Board’s own properties were funded from trusts and legacies.  From 1983 until July 2010 most of the rental, shared ownership and mortgage scheme properties purchased were financed by loans from the Church Commissioners.  Under this arrangement, the legal ownership of each property lay with the Board but a significant part of the economic interest lay with the Commissioners.  In the case of mortgaged and shared ownership properties, the Commissioners’ economic interest was in the same proportion as the amount of financing they provided compared to the purchase price.  Purchases were recognised at cost and the loan from the Commissioners recognised at an equal amount within creditors. If the property were sold, an amount equal to the proceeds (for mortgaged and shared ownership properties, in the same proportion as the financing they provided compared to the purchase price) would be repayable.  This arrangement meant that the Commissioners retained a significant degree of financial control over the properties they funded, and on a property becoming vacant, determined if and when it was sold and for how much. 

Since the end of the Commissioners’ funding arrangement, financing for purchases of new rental or shared ownership properties has been provided through three sources. Firstly in 2010 the Board put in place a loan facility with Santander (transitioned to NatWest over 2024 and 2025). Secondly in 2015 the Board was loaned £70,000,000 from its subsidiary CHARM Finance PLC, which raised funds through the issue of a listed bond.  Thirdly in 2018 the Board was loaned £30,000,000 from its subsidiary CHARM Finance PLC, which raised funds through the issue of a second listed bond. Further details of both facilities are provided in Note 14. 

Of the £70,000,000 loaned to the Board in 2015, £41,841,000 was used to purchase the economic interest in 196 properties which had originally been funded by the Commissioners. The Commissioners retained a right to receive any profit on disposal of any of the 196 properties up to August 2025, over the agreed purchase price of that property, and in 2025 nil (2024: four) properties were sold by the Board, with nil (2024: £144,143) subsequently paid to the Church Commissioners as a result of this agreement. The arrangement expired at the end of August 2025. 

In addition to these arrangements, 48 rental properties were purchased with contributions from dioceses and others, where the contributions are repayable when the property is sold, as either a simple repayment or in the same proportion as the original contribution to the purchase price, depending on the agreement made.  The Board recognises the full cost of the property and also recognises a liability for the amount contributed (see note 14). 

63 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

## _**13. Debtors**_ 

|**_13. Debtors_**|||||
|---|---|---|---|---|
||**Consolidated**||**Charity**||
||**2025**|**2024**|**2025**|**2024**|
||**£'000**|**£'000**|**£'000**|**£'000**|
|Trade debtors|620|663|593|651|
|Subsidiary undertakings & related parties*|106|8|4,882|4,874|
|Prepayments and accrued income|1,475|11,054|1,475|11,054|
|Joint venture (ChECS)|-|-|-|-|
|Other debtors|126|169|174|211|
|**Total**|**2,327**|**11,894**|**7,124**|**16,790**|



*Loans made by the Church of England Pensions Board to CEPB Mortgages Ltd, but ultimately funded by CC, are reflected in Charity current debtors These loans from the Board to CEPB Mortgages Ltd are repayable when the properties associated with them are sold. This is categorised as a current debtor for the Charity in line with FRS 102 section 4.7. 

## _**14. Creditors**_ 

|Current liabilities:|**Consolidated**||**Charity**|**Charity**||
|---|---|---|---|---|---|
||**2025**|**2024**|**2025**||**2024**|
||**£'000**|**£'000**|**£'000**||**£'000**|
|Amounts falling due within one year||||||
|Trade creditors|1,260|1,311|1,260||1,309|
|Accruals and deferred income|3,786|3,569|3,786||3,569|
|Tax creditor|4|32|4||32|
|Other creditors|1,649|412|1,649||412|
|Joint venture (ChECS)|476|896|476||896|
|**Total amounts falling due within one year:**|**7,175**|**6,220**|**7,175**||**6,218**|
|Concessionary loans repayable on sale of fixed assets||||||
|Loans from Church Commissioners for:||||||
|- rental properties|15,114|17,028|15,114||17,028|
|- shared ownership properties|2,451|2,640|2,451||2,640|
|- mortgage properties|18,569|20,704|18,569||20,704|
|Diocesan and other creditors|453|513|453||513|
|**Total loans repayable on sale of fixed assets**|**36,587**|**40,885**|**36,587**||**40,885**|
|||||||
|**Total current liabilities**|**43,762**|**47,105**|**43,762**||**47,103**|



Loans from the Church Commissioners are repayable when the properties associated with them are sold.  The trigger for the repayment is the sale of the property and the proceeds are passed in full (less direct sale costs) to the Church Commissioners.  Properties are sold when residents vacate rented properties, shared ownership properties are sold and mortgages are redeemed.  The mortgage assets are classified as programme related investments assets and are include in Note 10. Rental and shared ownership are classified as fixed assets and are included in note 12. 

FRS 102 section 4.7 states that where the repayment of a creditor cannot unconditionally be deferred for more than a year, it must be classed as a current liability.  Even though experience has shown that loans from the Church Commissioners will be repaid steadily over a timeline substantially longer than one year, they meet this definition and as a result are included within current liabilities. 

The terms of these concessionary loans are: for loans granted prior until 31 March 1993 the initial interest rate was 3%, increasing in line with RPI each April; for loans granted from 1 April 1993 the initial interest rate was 4%, increasing in line with RPI each April. 

The same current liability classification has been applied to the Diocesan loans to the Pensions Board. 

64 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

## _**14.     Creditors (continued)**_ 

|**_14.     Creditors (continued)_**|||||
|---|---|---|---|---|
||**Consolidated**||**Charity**||
|Non-current liabilities:|||||
||**2025**|**2024**|**2025**|**2024**|
||**£'000**|**£'000**|**£'000**|**£'000**|
|Bond liabilities – 2015 Bond|70,000|70,000|-|-|
|Bond liabilities – 2018 Bond|30,000|30,000|-|-|
|Bond liabilities – capitalised bond set-up costs|(547)|(575)|-|-|
|Intra-group liability – loan repayable to CHARM Finance PLC|-|-|100,000|100,000|
|Intra-group liability – capitalised bond set-up costs|-|-|(547)|(575)|
|Loans from Santander & NatWest|25,200|27,800|25,200|27,800|
|Loans from Santander & NatWest - capitalised set-up costs|(198)|(265)|(198)|(265)|
|**Total**|**124,455**|**126,960**|**124,455**|**126,960**|



The two bonds, issued by subsidiary undertaking CHARM Finance plc, were issued to finance the growth and development of the CHARM scheme. Transaction costs of £509,000 were incurred in respect of the 2015 bond, and £306,000 in respect of the 2018 bond. At 31 December 2025, the amortised cost of the set-up fees incurred (predominantly legal and financial advice fees) for both bonds was £547,000 (2024: £575,000). 

For the 2015 bond, interest due up to August 2017 was based on the initial interest rate of 3.126% adjusted for changes in CPI (subject to a 4% cap and a floor of zero). Since August 2017 the applicable interest rate has risen to 3.154%. Repayment of the bond is due in five equal instalments of £14m due in August of 2038, 2041, 2043, 2045 and 2048 respectively. The bond is secured by a fixed charge over 390 properties held by the Charity. 

For the 2018 bond, interest due is based on the fixed interest rate of 3.509%. Repayment of the bond is due in three instalments on 12 November 2044, 12 November 2046 and 12 April 2048. The bond is secured by a fixed charge over 186 properties held by the Charity. 

The following table details the maturity of the bond-related contractual payments as at 31 December 2025: 

||**2015**|**Bond**||**2018**|**Bond**||
|---|---|---|---|---|---|---|
|**Period**|**Interest due**||**Capital repayment**|**Interest due**|**Capital**|**repayment**|
||**£’000**||**£’000**|**£’000**||**£’000**|
|Due to end December 2025|905||-|139||-|
|Due within one year (to end December 2026)|2,682||-|1,043||-|
|Due between one and five years (to end<br>December 2030)|10,785||-|4,324||-|
|Due after five years|34,195||70,000|16,421||30,000|
|**Total**|**48,567**||**70,000**|**21,927**||**30,000**|



The intra-group liability due by the charity to CHARM Finance plc mirrors the terms of the bonds noted above. 

The charity has a loan facility with NatWest, which at December 2025 were secured by fixed charges over 244 properties (2024: 239 properties) owned by the charity, with occupied market value of £63,891,00 (2024: £63,130,000), and net book value of £43,199,000 (2024: £41,196,000).  The loans are repayable, subject to terms and conditions, at Dec 2039. 

The cost of the NatWest arrangement fee of £500,000 (1% of the loan facility) is offset against the loans and is being amortised over 15 years.  At 31 December 2025, the amortised cost was £198,000 (2024: £265,000). 

65 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

_**15. Financial Instruments**_ 

|||**Consolidated**||**Charity**||
|---|---|---|---|---|---|
||**Note**|<br>**2025**|**2024**|<br>**2025**|**2024**|
|||**£'000**|**£'000**|<br>**£'000**|**£'000**|
|**Financial assets at fair value through statement of financial activities**||||||
|Listed non-current investments|9|43,903|42,164|<br>43,916|42,177|
|**Total financial assets**||**43,903**|**42,164**|<br>**43,916**|**42,177**|



## _**16. Funds**_ 

|**Consolidated and charity**|**Balance at**<br>**1 January**|**Income**|<br>**Expenditure**|**Investment**<br>**losses**|<br> <br>**Other gains**|**Transfers**|<br>**Balance at**<br>**31 December**|
|---|---|---|---|---|---|---|---|
||**2025**||||||**2025**|
||**£'000**|**£'000**|<br>**£'000**|**£'000**|<br>**£'000**|**£'000**|<br>**£'000**|
|**Unrestricted funds**|-|14,031|<br>(14,031)|-|<br>-|-|<br>-|
|**Total unrestricted funds**|-|14,031|<br>(14,031)|-|<br>-|-|<br>-|
|**Restricted funds:-**||||||||
|General Purposes Fund:||||||||
|-<br>General Funds|121,633|27,107|<br>(27,692)|1,570|<br>-|948|<br>123,566|
|-<br>Earmarked – Property<br>Maintenance|15,530|-|<br>(1,008)|-|<br>-|(948)|<br>13,574|
|Clergy Retirement Housing Trust &<br>other trusts|14,743|774|<br>(505)|232|<br>-|-|<br>15,244|
|**Total restricted funds (excl.**<br>**pension reserve)**|**151,906**|27,881|<br>(29,205)|1,802|<br>-|-|<br>**152,384**|
|**Pension reserve**|-|-|<br>-|-|<br>-|-|<br>-|
|**Total funds**|**151,906**|**27,881**|<br>**(29,205)**|**1,802**|<br>**-**|**-**|<br>**152,384**|



For comparative purposes, the table below shows the movement on funds for the year ending 31 December 2024: 

|**Consolidated and charity**|**Balance at**|**Income**|<br>**Expenditure**|**Investment**|<br>**Other**|**Transfers**|**Balance at**|
|---|---|---|---|---|---|---|---|
||**1 January**|||**gains**|<br>**gains**||**31 December**|
||**2025**||||||**2025**|
||**£'000**|**£'000**|<br>**£'000**|**£'000**|<br>**£'000**|**£'000**|**£'000**|
|**Unrestricted funds**|-|13,634|<br>(13,634)|-|<br>-|-|-|
|**Total unrestricted funds**|-|13,634|<br>(13,634)|-|<br>-|-|-|
|**Restricted funds:-**||||||||
|General Purposes Fund:||||||||
|-<br>General Funds|108,822|48,284|<br>(24,612)|1,139|<br>-|(12,000)|121,633|
|-<br>Earmarked – Property<br>Maintenance|5,700|-|<br>(2,170)|-|<br>-|12,000|15,530|
|Clergy Retirement Housing Trust &<br>other trusts|13,586|1,755|<br>(812)|214|<br>-|-|14,743|
|**Total restricted funds (excl.**<br>**pension reserve)**|**128,108**|**50,039**|<br>**(27,594)**|**1,353**|<br>**-**|**-**|**151,906**|
|**Pension reserve**|-|-|<br>-|-|<br>-|-|-|
|**Total funds**|**128,108**|**63,673**|<br>**(41,228)**|**1,353**|<br>**-**|**-**|**151,906**|



66 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

## _**16.    Funds (continued)**_ 

## _**Unrestricted funds**_ 

The **unrestricted funds** represent expenditure incurred by the CEPB on salaries and working expenses subsequently recovered from the pension funds administered by the Board. The CEPB has no net assets or liabilities in its own right as a body corporate. 

## _**Restricted funds**_ 

The **General Purposes Fund (“GPF”)** is the largest charitable fund administered by the Church of England Pensions Board, covering the provision, maintenance & management of homes of residence for retired clergy and church workers and their spouses/former spouses/dependants, etc. 

£0.9m was transferred from the earmarked Property Maintenance fund to the restricted general fund (2024: £12m was transferred to the Property Maintenance fund from the general fund). 

The **Clergy Retirement Housing Trust (“CRHT”)** is a registered charity (Charity No. 236627-2) and is a linked charity of the Board.  As a linked charity, it is accounted for as a restricted fund. The charitable object of the CRHT is to use its property as residences for those persons who are qualified for such residence by virtue of the provisions of the Clergy Pensions Measure 1961 or any succeeding legislation. 

Below is a summary of the assets and liabilities of each fund as at 31 December 2025: 

|**FUND**|**Fixed Assets**|**Current**<br>**Assets**|**Current**<br>**Liabilities**|**Non-Current**<br>**Liabilities**|**SUB TOTAL**|**Provision for**<br>**Pension**<br>**Liability**|**NET ASSETS**|
|---|---|---|---|---|---|---|---|
||**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|
|Unrestricted funds|<br>259|1,441|(1,700)|-|**-**|-|**-**|
|**Restricted Funds:**||||||||
|General Purposes<br>Fund|301,673|1,944|(42,022)|(124,455)|**137,140**|-|**137,140**|
|Clergy Retirement||||||||
|Housing Trust &|11,233|4,051|(40)|**-**|**15,244**|-|**15,244**|
|other trusts||||||||
|**Total**|313,165|7,436|(43,762)|(124,455)|**152,384**|-|**152,384**|



For comparative purposes, the table below provides a summary of the assets and liabilities of each fund as at 31 December 2024: 

|**FUND**|**Fixed**|**Current**|**Current**|**Non-Current**|**SUB TOTAL**|**Provision for**|**NET ASSETS**|
|---|---|---|---|---|---|---|---|
||**Assets**|**Assets**|**Liabilities**|**Liabilities**||**Pension**||
|||||||**Liability**||
||**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|**£'000**|
|Unrestricted funds|454|1,199|(1,653)|-|**-**|-|**-**|
|**Restricted Funds:**||||||||
|General Purposes Fund|298,340|11,054|(45,271)|(126,960)|**137,163**|-|**137,163**|
|Clergy Retirement Housing<br>Trust & other trusts|11,325|3,599|(181)|**-**|**14,743**|-|**14,743**|
|**Total**|310,119|15,852|(47,105)|(126,960)|**151,906**|-|**151,906**|



## _**17. Subsidiary results**_ 

The Board owned 100% of CEPB Developments Ltd, a dormant company limited by shares, held to undertake property and building development at the Community Living schemes.  This company was dissolved and removed from the Register on 7 January 2025. 

The Board owns 100% of CEPB Mortgages Ltd (company no. 05540666) , a company limited by guarantee, held to administer mortgages on behalf of the Board.  The company is registered at 29 Great Smith Street, London, SW1P 3PS. 

The Board also owns 100% of CHARM Finance PLC (incorporated and acquired 17 July 2015, company no. 09692222, registered at 29 Great Smith Street, London, SW1P 3PS), a company limited by share capital of £50,000 (of which £12,500 has been paid up by the Board), held as a special purpose vehicle which in August 2015 provided £70m of funds to the Board via the issue of £100m of 3.126% Secured Bonds (including £30m in principal amount of Retained Bonds) due August 2048. In April 2018 CHARM Finance PLC provided a further £30m of funds to the Board via the issue of £50m of 3.509% Secured Bonds (including £20m in principal amount of Retained Bonds) also due in 2048. These funds are being used to secure current and future obligations for clergy housing in retirement. 

Summaries of the Board’s significant subsidiaries’ results are shown below: 

67 



## **Notes to the financial statements of the Church of England Pensions Board For the year ended 31 December 2025** 

## _**17.    Subsidiary results (continued)**_ 

|||**CEPB Mortgages**||**CHARM Finance PLC**|
|---|---|---|---|---|
||**2025**|**2024**|**2025**|**2024**|
||**£'000**|**£'000**|**£'000**|**£'000**|
|Revenue|366|365|3,755|3,640|
|Expenditure|(366)|(365)|(3,755)|(3,640)|
|**Result**|**-**|**-**|**-**|**-**|
|Total Assets|4,776|4,869|100,589|100,538|
|Total Liabilities|(4,775)|(4,868)|(100,576)|(100,525)|
|**Net Assets**|1|1|13|13|



## _**18.    Related Parties**_ 

## **Subsidiary companies** 

The Board received £366,000 from CEPB Mortgages (2024: £365,000) in respect of mortgage interest received by the Company. At the balance sheet date, CEPB Mortgages owed the Board £4,775,000 (2024: £4,868,000) in respect of mortgage loans repayable. 

The Board paid £3,859,291 to CHARM Finance PLC in 2025 in respect of bond interest paid by the Company (2024: £3,560,286). At the balance sheet date, the Board owed CHARM Finance PLC £99,453,000 (2024: £99,425,000) in respect of loans repayable in relation to the 2015 and 2018 bonds, and CHARM Finance PLC owed the Board £47,325 (2024: £41,494) in respect of interest repayable. 

## **Joint ventures** 

Church of England Central Services (ChECS) is a joint venture between the Church Commissioners, the Archbishops’ Council and the Church of England Pensions Board, and therefore a related party of the Board. More information can be found in Note 10. 

## **Pension Schemes** 

Details of amounts paid to the pension schemes are disclosed in note 8. 

68