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The opaque financing of Germany's churches

The huge expense of the Bishop of Limburg's headquarters caused much outrage in Germany. The scandal drew attention to the fact that the churches are not obliged to disclose their finances despite receiving state funds.

Together, Germany's Catholic and Protestant churches received 460 million euros ($622 million) from the state in 2012. This annual allowance, the so-called "dotation," is rooted in a specific historical tradition. At the start of the 19th century, the two churches lost a large swathe of their property to a secularization process instigated by Napoleon across Europe. The dotation, fixed by several treaties with the Vatican, has been offered by way of compensation ever since.

Within Germany, the actual amount varies greatly from state to state. It is also enshrined in Germany's constitution, or Basic Law - bequeathed to Federal Republic from the Weimar era and then the "Reichskonkordat," the treaty made between the Vatican and the Third Reich in 1933, which regulated the relationship between church and state.

Former SPD finance expert Ingrid Matthäus-Maier Foto: Soeren Stache dpa/lbn

Matthäus-Maier thinks the situation is unacceptable

Former Social Democrat finance expert Ingrid Matthäus-Maier said these regulations should have been abandoned long ago. "They are unconstitutional," she told DW, pointing out that even in the early 19th century the idea of replacing the annual fee with a one-off payment had already been planned. As far as Matthäus-Maier is concerned, the payment of millions of euros every year is a hopelessly arcane and outdated practice as well as a betrayal of the principle of separating church and state.

Writer and political scientist Carsten Frerk also said the dotation is constitutionally problematic. "The Weimar Constitution itself actually called on the legislators to end these state payments," he said. The government, however, became preoccupied with more pressing problems - specifically, devastating inflation - and the issue was swept aside.

Churches as commercial enterprises

Moreover, the 460 million euros is only a fraction of the money that flows into church coffers. The Protestant and Catholic churches also receive 9 billion euros from members in a so-called "church tax" which is collected by the state and passed on to the churches.

Frerk said church finances in Germany come from several major areas - income from church taxes and fees, from social projects, and from the churches' own fortune. Frerk said the religious bodies have a number of sources of income that one would not readily expect.

Both of Germany's major Christian churches operate a number of social projects, hospitals, child day care centers, and senior citizens' homes. But only a small part of this work, said Frerk, is financed by the churches themselves.

"The aid organizations Caritas and Diakonie have Church-quota of 2 percent," he said. "That is what the church itself contributes. But that creates this myth that the church does so much good. It does do good, but it doesn't actually pay for it." A majority of the activities attributed to the churches are actually financed by the state, Frerk continued, adding that there was no real difference between the Protestant and the Catholic Churches on this issue.

Das Luftbild vom 09.10.2013 zeigt den Neubau des Bischofssitzes (weiß) des Limburger Bischofs Franz-Peter Tebartz-van Elst unmittelbar vor dem Dom von Limburg (Hessen). Die Kosten für den Neubau des Bischofssitzes sollen inzwischen auf 31 Millionen Euro angestiegen sein. Foto: Thomas Frey/dpa

It's unclear just how much property Germany's Christian churches own

Paying wages

The German federal government also pays for the wages of bishops and other church employees, as well as for the construction and maintenance of religious buildings. The Bavarian audit board, for instance, has calculated that the state of Bavaria finances around 700 churches from the public purse to the tune of 40 million euros, plus another 90 million euros for Church employees. These numbers often leave specialists themselves struggling to keep track, not in least because a special legal exemption means that the churches are not obliged to publish their accounts.

"It's totally non-transparent," said Matthäus-Meier. "The dotation of North Rhine-Westphalia for the Catholic Church alone is 6 million euros. But the state chancellery there doesn't know how much of that goes into the salary of Bishop Meisner of Cologne."

She also said no one really knows exactly how big the church's property is, "even though the church is one of the biggest property owners in Germany." As far as she is concerned, this is unacceptable. "This is a public corporation. It gets money. These things have to be laid out on the table."

Germany's main political parties have never done anything to touch church privileges. Angela Merkel's Christian Democratic Union and its Bavarian sister party, the Christian Social Union, want to keep the regulations as they are. "And the others, who know that it won't do, are scared of challenging the churches," said Matthäus-Maier, adding that the established financing structure is difficult to break.

And yet some of Germany's dioceses - those in Hamburg, Essen, Münster and Speyer - have reacted to the fresh criticism generated by the Limburg scandal - by publishing their finances.

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