A new report shall urge General Synod to pass a new law stipulating that a landmark facing insolvency should not be put up for sale.
The document says the legislation should clarify that a cathedral unable to pay its debts can enter into a Company Voluntary Arrangement (CVA).
A CVA is an agreement where a party agrees to pay creditors all or some of the cash owed during a set time period.
In its findings, the Cathedrals Working Group said: “It is currently not clear how the statutory insolvency regime applies to cathedrals.
“If the provisions of insolvency legislation which enable an insolvent corporation’s debts to be dealt with in an orderly way is not available, the insolvency of a cathedral would be exceptionally difficult to manage.
“We therefore recommend that legislation should be developed to clarify that the CVA regime will apply to cathedrals, should the need arise.
“The legislation should be drafted to make clear that winding-up provisions should not allow the sale of the cathedral to meet a Chapter’s debts.
Attention was drawn to the financial sustainability of the Church’s 42 cathedrals when Peterborough Cathedral became engulfed by a cash-flow crisis.
The report cites “anecdotal evidence” that “other cathedrals” are also “in a weak financial position”.
It warns: “Whenever cathedrals get into debt and serious financial difficulties, this presents a…
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