Pope Francis Issues Decree to Address Vatican Corruption, Reduce Nepotism

The papal document aims to promote ‘faithful and honest administration’ with respect to public contracts, an area of Vatican finances that has previously involved problematic practices.

(photo: Unsplash)

VATICAN CITY — Pope Francis issued a new apostolic letter in the form of a motu proprio today aimed at increasing “transparency, control and competition” regarding public contracts at the Holy See.

The new laws are geared to addressing a number of problematic practices regarding the hiring of external contractors, some of which have been reported over the years and revealed during the 2012 “Vatileaks” scandal.

The fruit of four years of interdicastery consultation, the new regulations will serve, the Vatican says, as a centralized “single reference point” for all Vatican bodies when awarding contracts to external bodies and aim to “allow better management of resources and reduce the danger of corruption.”

In a June 1 statement, the Vatican said the regulations comply with “the most advanced international legislation” in this area. In the motu proprio, Pope Francis said his new decree reflects the “diligence of a good family father” whereby the good management of public goods requires “faithful and honest administration.”

He also pointed out that the “increased interdependence of the global economy” has increased the potential for “significant cost savings through the work of multiple suppliers of goods and services.” 

The Vatican’s statement stressed that the new regulations conform with the United Nations Convention Against Corruption, which the Holy See signed in 2016, and replaces previous regulations in force at the Administration of the Patrimony of the Apostolic See (APSA), which manages the Holy See’s assets and real estate, and the Governorate of Vatican City State, the Vatican’s main administrative body.

Giuseppe Pignatone, the head of the Vatican’s judiciary, said in comments provided to the media that the decree is “an important manifestation” of the Pope’s determination “to be an active part of the international community” and is part of the implementation of recent “important reforms” of the Vatican’s legal system.

A leading Italian anti-mafia prosecutor until his appointment to the Vatican last October, Pignatone said the papal decree represents a “decisive commitment against the risk of corruption” and will achieve “considerable savings” due to “wider and fairer competition” — an aspect, he said, particularly pertinent in the face of today’s financial pressures.

Consisting of 86 articles, with an additional 12 relating to juridical protection in cases of litigation, the motu proprio (a document issued of the pope’s own accord) rules that bids for contracts are to be given “equal treatment” through measures aimed at combating “illegal competition agreements and corruption.”

The document underlines the ethics of “economic choices” when issuing public contracts, respect for the social doctrine of the Church, the principle of subsidiarity in management decisions, and “loyal collaboration” between Vatican bodies and the governorate.

The goal is to obtain “cost-savings, effectiveness and efficiency” through “planning and rationalization of expenditure,” the Vatican statement said, while avoiding unnecessary operations and enforcing an award procedure that “must be transparent, objective and impartial.”

The motu proprio stresses that measures must be taken to avoid conflicts of interest, illegal competition agreements, and corruption. Any organizations with a criminal record are to be excluded from taking part in tenders. Also excluded are any organizations guilty of tax evasion or based in tax havens.

Contracts are also to be awarded in a “centralized manner,” with some exceptions, but these must be duly justified, the document says. The Secretariat for the Economy will publish a “list of prices and reference fees for goods and services” every six months, in consultation with the APSA. Vatican bodies must submit their plans for purchases by Oct. 31 each year.

Also under the new rules, a list of those authorized to handle such bids will be established. These members “will be drawn by lot” and then rotated “among the committees,” but always in accordance with their specific professional qualifications, the Vatican said.

To deter nepotism — a long-standing source of corruption in the Vatican and Italy — a detailed list of “incompatible characteristics” is laid out, including any familial relationship “up to the fourth degree” or affinity “up to the second degree” of a person who has submitted a bid. Any person belonging to a company that has taken part in a Vatican-related tender in the previous five years is also disqualified.

The Vatican statement says the new laws are governed by canon law and consistent with “best practices” in force in many states.

In comments to Vatican media, professor Vincenzo Buonuomo, rector of the Pontifical Lateran University and an adviser to Vatican City State, said the decree is a “reminder” of how “important and urgent better resource management is today.”

Many of the corrupt practices addressed in the document were revealed in the Vatileaks scandal of 2012, cases that made their way into the famous dossier assembled by a commission headed by Cardinals Julian Herranz, Josef Tomko and Salvatore De Giorgi.  

For years, certain officials had been skimming off external contracts, assigning to themselves kickbacks and other privileges or awarding tenders to relatives and friends.

In 2017, one of Cardinal George Pell’s last acts as prefect of the Secretariat for the Economy was to propose to Cardinal Pietro Parolin, the Vatican secretary of state, that similar measures in today’s motu proprio be taken to avoid corruption in the area of financial contracts. The secretariat had worked for the ideals contained in today’s motu proprio from its inception.

It is not clear to what extent these new laws will apply to financial services and creating a single asset management investment fund, but they are likely to be applicable to dubious property deals, such as those in London carried out over the past five years by senior officials in both the Secretariat of State and the APSA, the former of which led to a police raid and staff dismissals last October.

Informed sources told the Register June 1 that they welcomed the development, but pointed out that the motu proprio dealt only with future contracts and not those existing now, some of which were made illicitly and by personnel still in position.

A source close to the Secretariat for the Economy said the motu proprio and the measures it implements nevertheless “represent a wonderful advance.” On their own they will not “solve the grave financial problems facing the Vatican,” the source added, “but they spell out the methodology which has to be followed going forward: transparency, proper control and competition amongst suppliers with competitive costing and pricing to the benefit of the Holy See. Regular independent auditing will be needed to ensure that these norms are being followed.”

Clockwise from top left: Christ is adored in downtown Indianapolis July 20; Bishop Andrew Cozzens blesses the faithful with the Blessed Sacrament from the Indiana War Memorial July 20; the Host is elevated at Mass and adored at Lucas Oil Stadium on Day 2 of the NEC.

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