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 / Updated  / Source: Reuters

VATICAN CITY - Pope Francis has taken his boldest step yet to overhaul the Vatican's scandal-plagued finances, creating a new department with broad powers to oversee all of its economic and administrative affairs, the Vatican said on Monday.

The Secretariat for the Economy will answer directly to the pope and will be headed by Australian Cardinal George Pell, currently the archbishop of Sydney.

The pope will also name an auditor with oversight powers, according to a papal document known as a Motu Proprio, Latin for "by his own initiative," formalizing the changes.

The Secretariat will be guided in policy making by a new 15-member Council for the Economy, which will be made up of eight cardinals and bishops and seven lay financial experts from the around the world.

The inclusion of the lay members was seen as a move by the pope to bring more outside expertise into the often closed world of Vatican finances to avoid repeats of scandals that have hit the Holy See for decades.

In the Motu Proprio, the pope says that the Church must see its possessions and financial assets in the "light of its mission to evangelize, with particular concern for the most needy."