ROME — In another milestone along the path to financial reform, Pope Francis’ new “Council for the Economy” met for the third time Thursday, among other things working out details for transfering the Vatican’s power of the purse ever more completely to Australian Cardinal George Pell.

The Council for the Economy was established Feb. 24 by Francis, and is composed of eight cardinals and seven lay experts, marking the first time at such a senior level that laity have sat on a decision-making body in the Vatican as full equals with cardinals.

Cardinal Daniel DiNardo of Galveston-Houston is the lone American on the council.

The council’s function is to oversee financial operations, principally the new Secretariat for the Economy established by the pope in February and entrusted to Pell, who has moved quickly to bring the Vatican’s various financial centers under his control.

Francis has made the financial clean-up operation the leading edge of his broader project of Vatican reform, and the 73-year-old Pell is the man he’s tapped to make it happen.

According to Fr. Federico Lombardi, the Vatican spokesman, during the one-day meeting the council discussed the statutes outlining the powers and responsibility of the Secretariat for the Economy, as well as those for a new Vatican auditor general as well as a transfer of operations from the “ordinary section” of the Administration of the Patrimony of the Apostolic See (APSA) to the new secretariat.

Historically, APSA has been one of the Vatican’s most important financial departments, responsible for administering both investments and real estate. It’s also been an occasional source of scandal, most recently centering on a former APSA accountant named Monsignor Nunzio Scarano who’s been charged by Italian authorities with money-laundering and involvement in a cash-smuggling scheme.

As part of his testimony to Italian investigators, Scarano charged that various forms of corruption and shady practices were common at APSA, such as moving Vatican deposits from one commercial bank to another in exchange for perks for APSA officials such as vacations in five-star luxury hotels.

As part of the reform envisioned by Francis, the “ordinary section” of APSA, responsible for personnel and procurement, will now belong directly to Pell’s secretariat. Part of the “extraordinary section,” which handles investments, is expected to be folded into a new Vatican investment management center, leaving APSA largely to handle real estate holdings.

Also on the agenda for Thursday’s meeting were the practices to be adopted for the preparation of an annual budget for the Vatican’s various institutions, something that many of them have never had before, at least in any formal sense.

Missing from the line-up for the council’s meeting was French businessman Jean-Baptist de Franssu, who on July 10 was appointed head of the troubled Vatican Bank. Speaking on background, sources told Crux his absence was intended to avoid any conflict of interest.

When the council was created, the Vatican stressed that it’s not merely an advisory organ to the Secretariat for the Economy, but rather has authority over all economic and administrative activities within the Holy See and Vatican City State.

The secretariat is supposed to implement policies determined by the council and answers directly to the pope.
Francis created both bodies in an effort to simplify, consolidate and oversee management structures and to improve governance by implementing a tighter control over the financial activities of the Vatican’s 230 departments.

Together with the appointment of de Franssu in the IOR, these steps have been described by Pell as the Vatican trying to become “a model of financial management, rather than an occasional source for scandals.”