Archdiocese of Berlin challenged by prospect of bankruptcy
The Catholic Archdiocese of Berlin is on the brink of financial collapse, and extensive layoffs look certain as it struggles with massive debt, a spokesman said on Monday.
Many businesses have gone bankrupt in the current German slump, but Cardinal Georg Sterzinsky is one of the most unusual chief executives to be caught in the crunch. The Archdiocese is home to 382,000 Catholics.
Spokesman Andreas Herzig said Christmas bonuses would continue to be paid to the church's 2800 employees in Berlin. However management consultants from McKinsey have been called in to advise on cost cuts and job cuts look imminent if the Archdiocese is to avoid insolvency.
The workforce at Caritas, which employs another 2800, will also be cut back. Although a diocese cannot be declared legally bankrupt like a business, it can reach a point where banks stop lending to it and it can no longer pay its bills.
Herzig denied the diocese was approaching that insolvency stage.
Vicar-General Peter Wehr told the newspaper Tagesspiegel that the debts had mounted to 75 million euros. Berlin's problems have been worrying Germany's other 26 bishops, but none of the others are in such dire straights.
Archdiocese of Berlin
Archdiocese of Berlin (catholic-hierarchy.org)
30 Oct 2002