Pope Francis announced on Thursday that the Vatican’s pension fund is facing a “serious imbalance” that may require restructuring.
In a rare letter addressed to all cardinals and Vatican office leaders, the Pope did not specify the scale of the issue but emphasized that the changes would involve “difficult decisions” that will demand “particular sensitivity, generosity, and willingness to sacrifice” from all involved.
To address the matter, the Pope appointed Cardinal Kevin Farrell, an Irish-American prelate who has led the Vatican’s family office since 2016, as the new administrator of the pension fund.
This comes amid the Pope’s ongoing concerns over the Vatican’s financial situation. In October, he ordered a third pay cut in three years for the cardinals in charge of the Vatican’s departments and urged a “zero deficit” approach. While the Vatican has not released a full budget statement in recent years, it is known to be grappling with a significant budget deficit.
In 2022, the Vatican’s finance chief estimated that the pension fund’s net liability for post-employment benefits stood at around 631 million euros ($664 million).
The Vatican operates with two separate entities: the Holy See, the internationally recognized sovereign body, and Vatican City, a 108-acre city-state within Rome. These entities maintain distinct budgets, with income from the Vatican Museums often used to help cover the Holy See’s deficits, which, according to Italian media, was around 83 million euros ($87 million) last year.
