Pope Francis has ordered cardinals to take a 10 percent pay cut and reduced the salaries of most other clerics working in the Vatican in order to save jobs of employees as the coronavirus pandemic has hit the Holy See's income.
The Vatican said on Wednesday that Francis issued a decree introducing proportional cuts starting on April 1. A spokesperson said most lay employees would not be affected by the cuts.
A senior Vatican prelate said it was believed to be the first time in living memory that a pope had taken such action.
Francis, 84, and from a working class family, has often insisted he does not want to fire people in difficult economic times, even as the Vatican continues to run up deficits.
Cardinals who work at the Vatican and live there or in Rome are believed to get salaries of about $4,730 to $5,915 a month, and many live in large apartments at well below market rents.
Most priests and nuns who work in Vatican departments live in religious communities in Rome, such as seminaries, convents, parishes, universities, and schools — giving them greater protection from economic downturns.
They have much lower living expenses than lay employees — such as police, ushers, firefighters, cleaners, art restorers, and maintenance personnel — who live in Rome and many of whom have families.
It is these lay workers who the pope appeared to want to protect, as most of their employment levels were not listed in the papal decree. Vatican pay grades go from levels 1-10 for most employees. Senior positions have four grades, from C to C-3.
Apart from the cardinals, other clerics will see their salaries reduced by between 3 percent and 8 percent. Programmed pay rises for all but the three lowest pay grades will be suspended until March 2023.
Museums closed by pandemic
The Vatican's top economic official said earlier this month that the Holy See, the central administrative body of the worldwide Catholic Church, may have to use about $47 million in reserves for the second straight year as the COVID-19 pandemic burns through its finances.
It expects a deficit of about $59 million this year. Revenues are expected to be about $252 million in 2021, down 30 percent over 2020.
St. Peter's Basilica and the Vatican Museums, the latter a cash cow that received about 6 million paying visitors in 2019, were closed or only partially open for much of 2020 because of the pandemic. The museums had been due to reopen this month but remained closed because of a new lockdown by Italy.
In a seven-point preface to the decree explaining why action was needed now, Francis said the pandemic "has negatively affected all the sources of income of the Holy See and the State of Vatican City."
He said that, while both currently had "adequate capitalisation," he felt the duty to guarantee "sustainability and equilibrium between income and expenses" in the current economic climate.
Last year, top Vatican administrators ordered a freeze on promotions and hirings, and a ban on overtime, travel, and large events in an attempt to contain costs.
The Holy See budget covers entities in Rome that oversee the governing of the 1.3 billion-member worldwide Church, its diplomatic representations, and media operations.
Vatican City, including the Vatican Museums and the Vatican bank, has a separate budget, although income from both are often transferred to the Holy See to help plug deficits.
The Holy See's income is from donations, real estate management, and investments.