KEY POINTS

  • Money derived from Peter's Pence, donations from Roman Catholics around the world, are not being spent on the poor
  • Only 10% of total collections over the past five years have gone towards this purpose
  • The rest of the money went to helping close the Vatican's enormous budget deficit and to fund questionable projects

The misuse by the Vatican of "Peter's Pence" -- financial donations by lay members of the Roman Catholic Church and "other persons of good will" to support the Holy See -- has become an embarrassing legal scandal now engulfing the Catholic Church and Pope Francis.

One of Pope Francis' major aims at the start of his pontificate was to transform the Catholic Church into a “poor church for the poor." He now faces the painful reality that Peter's Pence, which is supposed to be used to support the poor throughout the world, has been spent instead on buying luxury real-estate in London and financing the Holy See's yawning budget deficit, a report by the Wall Street Journal noted.

The Holy See consists of the central administration of the Catholic Church and the global papal diplomatic network.

The Vatican itself describes Peter's Pence in glowing terms as "a gesture of charity, a way of supporting the activity of the Pope and the universal Church in favoring especially the poorest and Churches in difficulty. It is also an invitation to pay attention and be near to new forms of poverty and fragility.”

American Catholics have been told the purpose of the Peter’s Pence Collection is to provide the Church with the financial means "to respond to those who are suffering as a result of war, oppression, natural disaster and disease.”

Investigations have revealed only 10 percent of the money from Peter's Pence, which amounts to $55 million annually, was spent on charitable works for the past five years. A growing number of Church leaders are concerned the Catholic faithful are being lied to and misled about the use of their donations. This form of wilfull deceit, which is a sin under Church laws, will further hurt the credibility of the Vatican.

Some two-thirds of the Peter's Pence money was used to diminish the budget deficit at the Holy See, according to sources cited by WSJ. In 2018, the Holy See's budget deficit reached roughly $78 million on total spending of about $334 million. The report said this reflects chronic inefficiencies, rising wage costs and losses to investment income.

Analysts note the Church might have no choice but to secure funding from all sources it can find given its dire financial straits. The Holy See has struggled to no avail to rein-in its growing budget deficit. Pope Francis has long warned cardinals of the “grave impact” this crippling deficit will have on the Church's future operations.

The Vatican’s continuing financial problems reflect a lingering problems in improving its management and finances. Observers note that one reason Pope Francis was elected to the office in 2013 was to overhaul the Vatican's broken financial system following allegations of corruption, waste and incompetence.

Adding to the Holy See's financial woes is a marked decrease in contributions to Peter's Pence. Donations have fallen sharply in recent years. It dropped to $56 million in 2018 from over $69 million in 2017, said people in the know. Another decrease is expected for 2019.

Pope Francis and Maltese Prime Minister Joseph Muscat meet at the Vatican, despite calls from academics for the pontiff to cancel the event
Pope Francis and Maltese Prime Minister Joseph Muscat meet at the Vatican, despite calls from academics for the pontiff to cancel the event VATICAN MEDIA / Handout