Another costly setback for Vatican financial reform

Another costly setback for Vatican financial reform

By Phil Lawler | Jul 11, 2016

Here’s what you need to know about the latest reconfiguration of the Vatican’s financial agencies:

The Secretariat for the Economy was established to carry out reforms in the wake of financial scandals, to establish transparency and accountability.

The proposed reforms irked some veteran Vatican officials, and sparked internal disputes. As a result of which…

The power of the Secretariat for the Economy—the engine driving the financial reform—has been reduced.

In short, the motu proprio released on Saturday is another blow to the cause of transparency and accountability at the Vatican. As veteran Vatican-watcher John Allen observed, it is a victory for the “old guard”—the entrenched bureaucracy that blocks any significant change in the way the Roman Curia do business.

Just to make things clear, Cardinal Pell’s office is not having its wings clipped because of financial scandals. (“Pope reins in Vatican’s finance minister after scandal,” read one widely circulated headline, getting the story completely upside-down.) The Secretariat for the Economy was created because of the scandals. The money-laundering charges, the massive cost overruns, the no-bid contracts, the undervalued assets, the leaked confidential information, the undocumented expenses—all these took place before Cardinal Pell set up his new shop in 2014. The Secretariat helped bring these problems to light, set up procedures to guard against them, and in some cases took over the responsibilities that other offices had proven unable to handle cleanly.

Now the main work of financial management, which had temporarily been handled by the Secretariat, will return to the purview of the Administration of the Patrimony of the Apostolic See (APSA). This is the agency responsible for much of the trouble that Cardinal Pell discovered in Vatican financial management. Remember Msgr. Nunzio Scarano: the infamous “Msgr. €500” who was arrested in 2013 and now faces several different criminal charges for financial misconduct? He worked for years at APSA, rising to be the head of the accounting department—the accounting department—without causing his superiors to question how he was amassing a personal fortune on his modest salary. APSA is one of the major reasons why the Secretariat for the Economy was needed: part of the problem, not the solution.

John Allen, in his analysis of the motu proprio remarks that the Vatican’s “old guard” might come to rue this victory in the bureaucratic battle against Cardinal Pell:

If some new mess takes shape at APSA, it would no longer be Pell’s fault, at least in any direct sense. It would be on Calcagno [Cardinal Domenico Calcagno, president of APSA] and his team– and, more broadly, on the forces that pushed to put them back in charge.

Exactly. But it’s wrong to speak about what will happen “if” a new financial scandal arises. The only real question is when it will occur. Thanks in part to this latest setback for the cause of reform, the next scandal is coming soon.

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