Thousands of churches could be designated "festival churches" and closed down except for festivals such as Christmas and Easter under plans published today by the Church of England.

The massive church shut-down follows plummeting congregations especially in the countryside where one in four parishes, about 2,000, have fewer than ten regular worshippers. 

The Church of England now has fewer than 800,000 worshippers in the pews on an average Sunday, according to latest figures. Numbers have dropped to under half that of the1960s.

In the latest Government census, Christianity was still the largest religion in England and Wales with 33.2 million people stating this as their faith, but this was a decrease of 4.1 million from the previous census in 2001 when the question on religion was introduced.

Many of the churches are listed buildings and the dwindling congregations, often of elderly and retired people, face regular high bills for their maintenance, which is often prohibitively expensive because of their heritage status. 

The report is the first time in years that the Church of England has done a detailed stocktaking of its 15,700 church buildings, which include 42 cathedrals. Nearly eight in ten of these are listed. More than half are in rural areas where just 17 per cent of the population lives. Of these churches, more than nine in ten are listed. The Church is responsible for nearly half of all grade one listed buildings in England.

The report acknowledges "an ongoing need to guard against an idolatrous attitude to buildings" but says it is also a "scriptural truth" that place is a fundamental category of human and spiritual experience. Churches and cathedrals "assist in proclaiming the gospel just by being there".

The report also indicates a positive response will be given to adapting church buildings for community use. Already, some have become post offices, cafes, advice centres, food banks and credit unions alongside places of worship. The report says: "The primary purpose of churches is and should remain the worship of Almighty God, to be houses of prayer. But that can and needs to be sensitively combined with service to the community. The imaginative adaptation of church buildings for community use in many areas is breathing new life into them."

Bishop of Worcester Dr John Inge, who chaired the review, said: "Our 16,000 church buildings are a visible sign of ongoing Christian faith in communities throughout England as well as being an unparalleled part of our country's heritage. This report looks at how we can best support the thousands of local volunteers who care deeply for and about churches and offer wonderful service to their communities using their churches.

"We believe that - apart from growing the church - there is no single solution to the challenges posed by our extensive responsibility for part of the nation's heritage. We hope therefore that this work will be a catalyst for discussion about how churches can be better cared for and used for the common good."