Vatican moves to cut costs

Wage, hiring freezes take immediate effect

The Vatican has announced lay-offs and pay freezes for staff in a bid to cut administration costs in the face of a worrying forecast for the coming year.

In a letter to all Vatican departments, Secretary of State Cardinal Pietro Parolin announced a wave of cutbacks, including a stay on new hirings, non-renewal of temporary contracts, and a freeze on raises and promotions in addition to stricter controls on employees’ overtime. The letter has also requested those workers remaining to take on the duties of those set to depart as a further means of saving on costs while instructing departments to suggest qualified staff to be transferred to vacant posts.

According to Cardinal Parolin, budget forecasts for 2014 means “the immediate adoption” of the measures towards reducing costs.

The Vatican is moving to prevent the massive deficit experienced in 2011, when it recorded a €15 million downturn, the biggest such drop in revenue in recent memory. Despite a slight improvement in 2012, when accounts showed a budget surplus of just under €2 million, the situation looks threatening for 2014, according to estimates.

The bulk of expenditure across the Holy See is accounted for by wages for 2,800 employees, some of which is gained from the Holy See’s own investments and via the Vatican Bank, both of which have suffered through austerity and scandal in recent years.