If you fail to plan, you plan to fail

Author: Geoff Freeman

Published on: 8 October 2015

As the saying goes “If you fail to plan, you plan to fail!” however some PCCs still do not operate with a budget because of the perceived time required to prepare and monitor it.

With this in mind this article aims to encourage PCCs to create or improve their budget process.

Preparing a budget carefully and prayerfully demonstrates good stewardship of the funds that God entrusts to us by being a coherent plan of the PCC’s activity borne out of prayer, vision, prioritisation and discussion. It is most important that the budget is “owned” by the PCC and once approved provides a framework for mission and ministry within which the PCC Treasurer can monitor actual income and expenditure during the year.

Some benefits of setting and monitoring a budget are:

  • the realisation of your PCC’s mission and goals by ensuring that financial resources are allocated to them
  • regular budget monitoring will identify variances which can either be explained or require corrective action
  • the budget can be used to support applications for external funding by providing potential supporters with a good understanding of where financial resources have been allocated and what the PCC’s needs are
  • budgeting improves communication throughout your PCC and congregation because everyone can fully understand what the needs and priorities are and what financial resources are required to pay for them
  • as a consequence, a budget can also have a positive impact on stewardship due to the improved understanding of the church’s finances within the PCC and the church community.

Budgeting methods

There are two budgeting methods commonly used to construct a budget, namely incremental budgeting and zero-based budgeting.

Incremental budgeting is based on the previous year’s actual expenditure and adjusted accordingly for the budget period.

Zero-based budgeting makes no reference to the previous level of expenditure and must be calculated “from scratch”. This is more time consuming, however your investment in time may be well spent if you consider the potential financial advantages which could result from:

  • considering alternative suppliers of good and services
  • seeking better value for money
  • identifying and eliminating inflated, wasteful, obsolete or duplicate activities.

In addition to this, the zero-based budget approach requires greater communication and coordination within the PCC to think creatively about its mission and goals free from the restraints of past practices.

The Parish Share contribution is one of the most essential parts of the parish budget as this enables the Diocese to provide and support the provision of mission and ministry within the parish. The full Parish Share allocation must always be entered into the budget as it is this figure that the parish should expect to pay and the Diocese needs to receive in order to cover its costs. More detailed information about exactly how Parish Share is calculated is available from the Diocesan website at www.dioceseofnorwich.org/churches/finance/parish/parish-share

Budget Format and Structure

Designing your budget to fit in with your existing accounts will make monitoring much easier as your budget will be in a format that you are familiar with. If, however, you are willing to start from scratch, a pro-forma budget template is provided in the Treasurers Handbook, a copy of which is available on the Diocesan website at www.dioceseofnorwich.org/churches/finance/resources/handbook

Budget Monitoring

Once your PCC has approved its budget the PCC treasurer then has a framework to which income and expenditure can be monitored during the year.

The author...

No Image Found

Geoff Freeman

Parish Funding Support Officer

This article is from...

Articles in this issue...

Send a card this Christmas

Sales of greeting cards of all types have shown a rapid decline in recent years, this is due to a number of factors; the cost of the card, the postage and also that we now live in a digital age and many people will email or text greetings.


Where there’s a Will…

Every year many thousands of people die without leaving a Will.


Employees, PAYE and Auto-Enrolment

The term honorarium is commonly used when referring to payments to people for performance of duties.


Authorised Lay Ministry: Volunteer’s & Employer’s Liability Insurance

While it is important that PCCs are aware of insurance liability issues in relation to lay ministry, addressing this topic helps us reflect on the nature of lay ministry as publically authorised, supported and accountable, and the role of the PCC.


Helping you improve your parish magazine

We want to let church magazine editors know about the benefits of belonging to the Association for Church Editors.


Security inside your church

Practical advice from Norfolk & Suffolk Police for churches


Keeping the right side of the law when holding events

Last edition we covered the regulations as to the running of tombolas and raffles at parish events.


Top tips for winter church maintenance

It’s that time of year again when the weather sets in and we need to be extra vigilant in looking after our churches.


Rediscovering the church’s place in the local community

How WiFi access in Alysham Parish Church is enabling engagement with new audiences


Keep up to date

Subscribe to our eNews for a snapshot of news, events and resources, usually emailed once a fortnight

Signup to newsletter