Priority was debt not sex victims: inquiry The head of the Anglican Church's response to child abuse was that it was a matter for the diocese. PROTECTING investors in a multimillion-dollar diocesan investment fund debt took priority over the claims of abuse victims from a NSW Anglican children's home, an inquiry has heard. The Royal Commission into Institutional Responses to Child Sexual Abuse in Sydney was told on Wednesday that the Diocese of Grafton was $12 million in debt after building a private school at Clarence Valley, which never attracted enough students. The diocese has been accused of mishandling compensation settlements and claims from people who were brutally abused from the 1940s to 1980s at a Church of England orphanage in Lismore. In evidence by video link, Anthony Newby said when he became registrar at Grafton in October 2010 the school debt was not being serviced. An oversight committee was set up to open lines of credit involving other dioceses - not an easy task as only two, Perth and Adelaide, eventually came on board. This strategy was needed because the Clarence Valley Anglican School loan was unsecured from the Grafton Diocese Investment Fund, which operated by inviting people to invest on the expectation of a return. The debt-reduction strategy would also mean selling at least $2 million of the diocese's estimated $100 million asset base. Mr Newby said the group claim from the North Coast Children's Home had been settled before he got there and no money had been provided for further payments. When more claimants came forward in 2011, Mr Newby was given to understand by Bishop Keith Slater and Peter Roland, former lawyer for the diocese, "a pastoral approach" was preferred, the inquiry heard. As Mr Newby's background was corporate, he was not familiar with what this approach entailed. He said it was explained to him as someone "walking with" and supporting the victim. When he later saw another claim, not arising from Lismore, was being dealt with supportively, he became uncomfortable about how the Lismore abuse victims were being treated and voiced his concerns. When asked by counsel assisting the commission, Simeon Beckett, if he understood the debt took precedence over any provisions for future claims from abuse victims from the North Coast Children's Home, Mr Newby said: "That was certainly the priority I was given. The hearing also heard from Diocese of Brisbane professional standards director Rodney McLary, who assists Dr Phillip Aspinall, the primate of the Anglican Church in Australia who is also archbishop in Brisbane. Mr McLary said the primate's national role was to encourage, offer counsel and attempt to persuade other bishops and archbishops on certain matters. The inquiry heard that repeated requests for Dr Aspinall to intervene with Grafton were met with the response that the diocese was autonomous. But Mr McLary said he sought information from the Grafton diocese on Dr Aspinall's behalf. The diocesan registrar at the time, Pat Comben, gave the impression the matter was being dealt with by the diocese and there was no reason for anyone else to be involved, the inquiry heard. Mr McLary eventually formed the opinion the diocese did not favour conciliation or mediation. He also said that having had contact with Simon Harrison, the solicitor representing more than 40 victims, he felt the solicitor genuinely wanted to reach a satisfactory outcome and he was not bullying, as Reverend Comben had reported. Mr McLary also said he did not discuss involving police with anyone. The hearing is continuing and the former bishop of Grafton, Keith Slater, Rev Comben and Dr Aspinall will give evidence.