The Church of England has commissioned research into the implications of local churches undertaking welfare services, in response to the Government's growing interest in partnerships with churches and other faith-based organisations.

Both the Government and Opposition have affirmed the faith communities' unique and significant role in promoting social cohesion, education and regeneration and want to see this role expanded.

Politicians have been encouraging the Church to look towards greater involvement in the provision of statutory services across a wide range of areas including employment/jobcentres, health provision, residential care for the elderly, and aftercare of offenders.

The Bishop of Urban Life and Faith, the Rt Rev Stephen Lowe, said: "The Church has developed a reputation for doing work which statutory agencies are not prepared to take on and initiating new ground-breaking projects. The Government sees the potential of the Church of England's 16,000 parish churches to deliver services at a local level.

"The Government are also attracted by the excellence of our educational provision and are eager to see us replicate that in other areas. But it is important that guidelines are in place to assist parishes and dioceses considering becoming involved in this work."

The Esmee Fairbairn Foundation has provided a grant for the research work to be carried out. Dr Francis Davis and Dr Andrew Bradstock of Cambridge University's von Hugel Institute will carry out the work to review the implications of the churches' involvement in welfare provision.

Bishop Lowe continued: "There are many questions for the research to answer. These include: What are the implications for the Church's prophetic, evangelistic and risk-taking roles? What are the theological models which inform the Church's current social engagement, and how far are they compatible with this 'new agenda'? What are the blocks to effective partnership with Government arising out of their approach dominated by a market focused framework?"

He added: "These and many other questions have to be addressed before the Church can feel secure about entering into these sorts of relationships. The Church needs advice to be given to parishes and dioceses who are considering such work and we hope to have at least some policy guidelines by early next year."