THE Government has announced £230 million for heritage buildings, including listed places of worship, as part of a £1.5-billion funding package to “save” cultural venues across the country from closure.
But listed places of worship will no longer be exempt from paying VAT on essential repairs, the Department for Culture, Media and Sport (DCMS) confirmed on Wednesday.
Most of this £1.5-billion fund will support museums and capital projects in arts venues — £760m and £425m respectively — while £230 million is earmarked to protect and preserve heritage buildings, including places of worship.
Within this is a new £92 million scheme, the Places of Worship Renewal Fund, which will replace the £23 million Listed Places of Worship Grant Scheme (LPWGS) “in recognition of the important role religious heritage buildings play in the UK’s national story”, a government announcement said.
The announcement expresses the hope that this will “bring these important buildings into line with other heritage assets” and “give them access to the same level of financial support from the government as historic houses, monuments and other heritage sites”.
The new scheme will, however, no longer allow for individual places of worship to reclaim VAT on essential repair and maintenance costs.
Also within the £230 million, £75 million will be available in grants for historic buildings in need of repairs and conservation, and £46 million for the Heritage Revival Fund to support communities “to take control of and look after” local heritage, bringing buildings back into public use.
The announcement follows the Chancellor’s Autumn Budget, last year, which made no mention of the LPWG scheme (News, 25 November 2025). The 2025/26 LPWGS will close on 31 March, or once the £23m budget has been reached, whichever is earlier, the Government said.
Responding on Thursday, the chair of the National Churches Trust, Sir Philip Rutnam, welcomed the new capital funding scheme for religious heritage. He said: “We have been campaigning for this for some time, and we look forward to understanding how the new scheme will operate.
“Churches depend overwhelmingly on volunteers so the scheme will need to be simple, accessible and predictable if it is to be a success.”
He expressed concern, however, that listed places of worship would have to bear the full cost of VAT on repairs. “This brings to an end a system that has operated successfully for over 20 years. It means that in future local people will have to raise money not just to repair roofs and towers but to pay a 20 per cent tax to the Government.
“Museums and galleries offering free admission don’t have to pay VAT on repairs, but in future churches will. We call on the Government to end this unfairness and not to expect local volunteers to pay these extra taxes.”
The Church of England’s director for Cathedral and Church buildings, Emily Gee, said on Thursday that she welcomed the new scheme. By introducing it, the government recognised “the special role of historic churches in national life — church buildings are national treasures for the common good.
“They have huge spiritual, cultural and historical significance, and are major centres of practical assistance to their communities through services such as food banks, lunch clubs and parent and toddler groups. They serve as a place of sanctuary, refreshment and cultural heritage throughout the UK.”
Ms Gee also echoed Sir Philip’s concerns and said that the end of the LPWGS would put local fundraisers under additional pressure and would be a drain on other sources of funding. “We will work with the wider sector and the Government to see how that burden can be alleviated,” she said.
“We will continue to work closely with other church buildings’ charities and funders, Historic England and other denominations and faiths, as well as the Government, in this important period of transition,” she concluded.
The Minister for Museums, Heritage and Gambling, Baroness Twycross, said in a statement on Thursday that “listed places of worship are a central part of our built heritage and vital to our communities.”
She said that this year was the first evaluation of the LPWGS in its history, which found some benefits to users, such as increased timeliness of repairs. “However, it also showed that 80% of respondents would have carried out works without the rebate scheme.
“That is why the new Places of Worship Renewal Fund will target our capital funding where it is needed most, focusing on repair and conservation work, ensuring that every pound of taxpayers’ money is used to secure the future of our heritage while supporting the government’s wider missions for national renewal and community cohesion, as part of the broader Plan for Change.”
The Conservative MP for Droitwich and Evesham and shadow DCMS Secretary Nigel Huddleston, posted on X to thank those who “backed our calls for the government to reverse its cuts to the Listed Places of Worship Scheme”.
He wrote: “By cutting funding and placing a cap on grants for repairs and maintenance, the government’s previous policy had put many historic religious buildings at risk. They play a vital role in our communities and our nation’s heritage.”
The Conservative MP for Meriden and Solihull East and Shadow Education Minister, Saqib Bhatti, also posted on X: “We fought. We won. Our churches matter. After the Listed Places of Worship Grant Scheme was cut, I challenged the PM directly at PMQs. Thanks to pressure from activists, campaigners & Conservatives, the Govt has now u-turned and announced a £92m Places of Worship Renewal Fund.”
The chairman of Historic England, Lord Mendoza, said that the heritage funding was a clear signal that the Government recognised that the nation’s historic places mattered to people. “We have just unveiled firm evidence that historic places are vital for our mental wellbeing and people feel profound emotional connections with them,” he said.
“This funding will act as a lifeline for heritage across the country, from places of worship to ancient pubs and will give the heritage sector a well-needed boost.”