The Anglican Church in Sydney is in diabolical trouble. Already battered by the global financial crisis, the diocese is planning further savage spending cuts.

The archbishop, Peter Jensen, told the annual synod on Monday: "The financial issues are grave."

Peter Jensen ... ‘‘financial issues are grave’’. Credit:Domino Postiglione

One of the biggest and richest dioceses in Australia, Sydney leveraged its huge investment portfolio in the boom and sold when the market hit rock bottom. After losing more than $100 million, it was forced to halve its expenditure. "There was considerable pain," the archbishop told the annual gathering of clergy and laity in Sydney. But it wasn't enough.

"In round terms, it seems possible that the amount of money available … to support diocesan works in the next few years is going to be reduced from the $7.5 million of 2010 to something like $4 million. Our major rethink of last year was only the beginning."