THE Ballarat diocese has a $100 million development fund, but Bishop Paul Bird said it would still struggle to meet all clergy sex abuse compensation claims.
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Bishop Bird said they might have to rely on financial aid from other dioceses if a large amount of claims are made.
"I do have doubts that we could meet those claims," Bishop Bird said.
Bishop Bird also told the Royal Commission into Institutionalised Responses to Child Sexual Abuse the diocese had no idea of what its sexual abuse financial liability would be.
"The finance committee has come to the conclusion it can't predict it... it can't be very confident in its estimates.
"We may have to ask for help from other dioceses."
He agreed there were currently 130 substantiated complaints against the diocese, seven of which were in conjunction with the Christian Brothers.
Of these, 76 relate to disgraced priest Gerald Ridsdale, who appeared at the commission earlier in the week via video link.
Senior counsel assisting the commission, Gail Furness, said there were claims against 14 priests, but Bishop Bird disputed that, saying it was more likely 10 to 12.
Ms Furness asked how much of a victim's personal circumstances were included when settlements were made, including not being able to work or secondary victims such as wives or children.
"Do you know that secondary victims are taken into account or are you just expecting that to be the case?" Ms Furness said.
Bishop Bird said he believed secondary victims were included in settlement calculations.
However, he admitted the Ballarat diocese still made victims sign a waiver agreeing to take no further action against the church, despite other dioceses dropping it altogether.
When commission chairman Justice Peter McClellan asked Bishop Bird if child sex offences were seen in the church as "moral failings" rather than crimes, Bishop Bird said he hadn't heard that perception.
"They're moral offences, and criminal offences," he said.
When asked if he had destroyed any documents about abusive priests, Bishop Bird said no - but he said former Bishop Ronald Mulkearns had destroyed some medical records.
Justice McClellan asked Bishop Bird if he had to report complaints about priests to any higher church authority.
"Yes, I report to the congregation of the doctrine of faith (in Rome)," he said.
He said he had reported one priest convicted of an historic sexual offence but was still waiting for word from Rome on further action.
Justice McClellan asked if priests convicted of sexual abuse were automatically laicised, or expelled from the ministry, but Bishop Bird said this didn't always happen.
"(However) I believe that's not appropriate. My own personal view is that a conviction of child abuse be met with laicisation," Bishop Bird said.
When asked how the offences were allowed to occur, Bishop Bird said it was "a question of immaturity and abuse of power".
He also agreed the church had contributed to the offending because of its community position.
"That element of respect is particularly, or it was particularly strong, within the church... and made it less likely that people will challenge a priest," he said.
He also said the church "provided a cover for these people".
"It wasn't because they weren't following the rules of the church, it was because they used the church as a cover."
When asked by Justice McClellan how he was stopping abuse happening again, Bishop Bird said he was promoting the church not "lording it" over others.
He also agreed the minimisation of women needed to be changed, including women being ordained.
"Well essentially I don't see scriptural problems with that (the ordination of women)... it's the force of basically 2000 years of tradition which would be rather, yes, slow in changing I think,"he said.
He said it was a discussion that needed to be had if it helped the church have a more "balanced community".
Bishop Bird said no-one had ever confided child sex abuse crimes to him in confession, but he would refuse absolution to anyone who did so until they reported it to police.
Ms Furness asked Bishop Bird why successive bishops had not done anything about Gerald Ridsdale's crimes, despite him confessing outside the confessional.
"I know Bishop Mulkearns, that he considered, wrongly as we see now, that the priest could change. What he did was send the priest for counselling and treatment."
Justice McClellan said: "The bishop only looked at the position of the priest and took out of the equation, left to one side, the consequences for the children who had been abused and for those who would be abused."
Ms Furness added: "There was an overriding culture in the church in those years to protect the reputation of the church and protect the reputation of the offender without regard to the effects on the children", which was not limited just to Bishop Mulkearns.
However Bishop Bird said the awareness of child abuse impacts was much stronger now.
"The focus, I believe, is now rightly on the one who has been hurt and abused and their family," he said.
But he did agree there were divisions in the Ballarat community on the issue, including families torn apart.
"People have sometimes quite different reactions."
Justice McClellan said: "It's been said to us, there's a need for the leaders in the church to tell the community that it's a good thing that people who have been abused come forward."
Bishop Bird said he had said the same thing "several times" but "some people don't see that's a good thing, they may not see the extent of the need".
When asked what he was doing to help the community heal, Bishop Bird said one forum had been held in Ballarat and one in Warrnambool and he was using his bishop's role as an "avenue" to speak to the people.
Outside the commission, Bishop Bird offered a personal apology to those who had shared their stories.
"I have been very moved, very sorry, that as young children they endured such horrendous abuse. I'm sorry about the impact on their lives and their families," he said.
He said he hoped the commission developed appropriate recommendations and "provided a way forward for all victims of child abuse".
fiona.henderson@fairfaxmedia.com.au
