Covenant Theology - a brief Overview and Evaluation

Michael Hardt

From: “Discovering Biblical Dispensations” [1]

Our concern is the positive presentation of truth. However, some arguments and explanations will ultimately only become clear to readers if they are at least somewhat familiar with the counter-position, especially the basic features of Covenant Theology (also known as Federal Theology).

Those who are already familiar with this approach (as well as those who just want to engage with the truth, without familiarizing themselves with the counter-position) can skip this chapter.

Covenant Theology—a brief profile

An exhaustive discussion of Covenant Theology and its various manifestations would exceed the scope of this book. Consequently, this digression is only a brief summary and cannot cover all facets and nuances. As a result, a comprehensive evaluation cannot be provided here, and some remarks may not apply to all views of all proponents of Covenant Theology.

However, we have absolutely no intention of distorting Covenant Theology in any way but, rather, we desire to represent it fairly.

Portrait

Covenant Theology is an interpretative framework designed to aid in understanding the Bible and grasping its unity[2]. It maintains that the overarching theme of the Bible can best be understood through covenants.

Approaches of this line of thought can be found in Calvin and Zwingli. In 1646, Covenant Theology was included in the Westminster Confession. It was brought to America by the Puritans.

Three covenants

Covenant theologians speak of three overarching covenants. These are often referred to as “theological” covenants because the Bible doesn’t explicitly mention them:

The Covenant of Salvation: This covenant is believed to have been established in eternity, before time, among the persons of the Godhead (i.e., the Father, Son, and Holy Spirit). The content of this covenant is that the divine persons have agreed upon the salvation of man and their respective roles therein.
This “covenant,” it is taught, is limited to a specific group of people: the elect. Atonement will only be made for these individuals, and only they can be saved.
The Covenant of Works: It is thought that God made a covenant with Adam when He commanded him not to eat from the tree of the knowledge of good and evil. This would have been a conditional covenant, for Adam was promised eternal life if he obeyed God’s command. Disobedience, on the other hand, should be punished with death. Referencing Romans 5:12-21, Adam is seen as a representative (or covenant head) of all humanity, and Christ as the representative of those who are saved. Adam failed through disobedience. As a result, covenant theologians argue, he broke the Covenant of Works, and he did so on behalf of all humanity. On the other hand, Christ kept the law (which is true), and this righteousness has been “credited” to those who belong to Him (which is not true).
Lastly, it is posited that God has instituted a Covenant of Grace since the Covenant of Works was broken. This Covenant of Grace was established between God and the elect after the fall of man (Genesis 3:15 is often cited as the inauguration of the Covenant of Grace). Under the Covenant of Grace, God promises sinners eternal life and salvation. To receive this salvation, people must repent and believe in Christ. God gives the sinner (through the Spirit) both the will and the ability to do so. While the Covenant of Works ties blessings to obedience, the Covenant of Grace is unconditional (except for the requirement of faith in Christ).

Furthermore, it is taught that the Covenant of Grace encompasses all of God’s dealings with man in the Old and New Testaments: It remains essentially the same even after the introduction of the Mosaic Law and even after the gospel, although there are certain differences in the way this covenant is handled or administered:

The covenants with Noah and Abraham are further “editions” of the Covenant of Grace.
After the introduction of the law, the Covenant of Grace became visible in the sacrifices, prophecies, and certain Jewish ordinances that pointed to Christ (the law represented the Covenant of Works on the one hand, as it holds one accountable, and on the other hand it represented the Covenant of Grace, as it contains rules for sacrifices that point to Christ).
The people who have lived since the enactment of the law have been justified through their faith in Christ (even though they lived before He came) just as New Testament believers who have faith in Him.
The Jewish ordinances (such as sacrificial service) were abolished with the coming of Christ and replaced by the “sacraments” of baptism and communion.

The fulfillment of the Old Testament covenants

Covenant Theology holds the view that the covenants found in the Old Testament have been fulfilled through Jesus Christ:

The promise to Abraham that all nations will be blessed has been fulfilled through Christ.
The covenant with David that a descendant of David will rule forever has also been fulfilled through Christ.
The new covenant has likewise been fulfilled through Christ.
Believing Christians (and thereby the Christian church) form or are included among the people of Israel (that is, Israel and the church are regarded as the same people of God).

The promises of the Old Testament prophets are considered already fulfilled: The promised blessing (will not be fulfilled in the future when Christ reigns in Israel, but) has already come “spiritually” to the “spiritual Israel.”

Variations on the theme (different directions of Covenant Theology)

Within Covenant Theology, various directions can be identified, which we would like to briefly outline in order to represent the covenant-theological viewpoint as fairly as possible (attacking a “straw man” helps no one).

Two important currents are the classical Covenant Theology (as set out in the Westminster Confession) and the Methodist Covenant Theology. One of the main differences touches on the question of whether or not the Covenant of Grace has supplanted or replaced the Covenant of Works.

The classical Covenant Theology assumes that the Covenant of Works still exists and is still valid for all people today—only that no person can be saved any longer through their own effort. It teaches that Christ has fulfilled the Covenant of Works on behalf of the elect, both in relation to the positive requirements of righteousness (practical obedience) as well as in relation to the negative consequences of punishment (His atoning death). If God granted grace to the people of Israel in the Old Testament, this would be an aspect to do with the Covenant of Grace; if He punished them (for instance, through the Babylonian captivity), this would be an aspect to do with the Covenant of Works.
The Methodist belief, on the other hand, posits that the Covenant of Works was abolished at the time of the fall of man and has not existed since then.

However, both streams share one crucial commonality—that people of all times are viewed as being under the Covenant of Grace (meaning: Adam, Moses, and every believer today have all been saved in the same way, which is through faith in Jesus Christ).

Another difference among various expressions of Covenant Theology is that the first “covenant” (Covenant of Redemption) is sometimes not mentioned. Following this view, there are two covenants to be considered, namely the Covenant of Works and the Covenant of Grace.

The “unifying principle”

Covenant Theology purports to provide a framework that allows us to understand the Bible as a whole. The “unifying principle” here is the Covenant of Grace. The fundamental assumption is that this covenant governs the relationship between God and humans at all times. Dispensational periods are not differentiated, since God at all times interacts with all people on the same basis, namely by the offer of salvation in response to faith in Christ and His work.

Simply put: Everything that has to do with responsibility (e.g., the law from Sinai) belongs to the Covenant of Works. Everything associated with grace belongs to the Covenant of Grace. Both, law and grace, are equally relevant for Jews in the Old Testament and Christians in the New Testament.

The things to come

As for the eschatological (concerning future things) side, Covenant Theology arrives at the following conclusion:

Given that the promises of the Old Testament—including the Messianic kingdom of peace—have already been “spiritually” fulfilled in the New Testament church, they will not be literally fulfilled anymore.
Therefore, no literal kingdom on earth is expected, nor the return of Christ to establish such a kingdom.

Evaluation

It is always sad when Christians quarrel, especially when it involves distorting and misrepresenting each other’s views. In the following remarks, I am consciously trying to avoid this trap. I understand that covenantal theological views are held by genuine Christians who are serious about their faith (and some of them I have personally come to know well).

On the other hand, we are called to “contend earnestly for the faith which was once for all delivered to the saints” (Jude 3; nkjv), and at times we can’t avoid exposing views in our presentation or defense of the truth that, from our perspective, fall into the category of error—especially when they concern the glory of the Lord Jesus and the relationship of the believers to Him. We hope that the following remarks will be read in this spirit and have a positive effect.

Agreement

First of all, it should be noted that covenant theologians often adhere to key parts of biblical truth. These include (but are not limited to):

the inspiration of the Bible
the Trinity
the fall of man into sin
the deity, humanity, Sonship, and sinlessness of Christ
salvation through faith
the necessity of grace.

It is important to keep this in mind, even—and especially—when differences are being pointed out.

Differences

On the other hand, there are significant differences. Here, we can only give a brief overview. In doing so, we first look at the approach and then the consequences.

The approach

An obvious, but far-reaching observation is that the three covenants invoked as a unifying principle, are not found in the Bible. The Bible mentions a series of covenants between God and men: These involve covenants with Noah, Abraham, Israel, David, and again with Israel and Judah (the new covenant). Covenant theologians, however, speak of “theological” covenants as opposed to biblical covenants. This fact in itself should provide ample reason to pause for reflection. Here, the foundation is shaky.

No covenant of salvation

Covenant theologians cite a number of Bible verses to argue that one can speak of a Covenant of Salvation. These include Isaiah 49:6-8; Luke 22:29; John 10:18; John 17:4; Titus 1:2 and 1 Peter 1:20. These passages show that God had a decree or plan of salvation. However, not one of these passages (or any other passage) speaks of a covenant within the Trinity—or of a covenant made by one divine Person with another.

Actually, it is even worse: The problem is not only that the concept of a covenant within the deity is not found in the Bible—and is therefore contrived and essentially fiction—but that it contradicts biblical teaching. Just read passages like John 5:19-30. They show the wonderful unity and harmony among divine Persons. Independent action is virtually ruled out: Introduced with a “Truly, truly,” the Lord says, “The Son can do nothing of Himself, unless it is something He sees the Father doing.” But not only that, He adds that the Son even acts in the same way as the Father: “For whatever the Father does, these things the Son also does in like manner” (Jn. 5:19). In light of this wonderful relationship, unity, and harmony, is it appropriate to talk about divine Persons as making a “covenant” with each other?

According to my dictionary, a covenant is a “union,” an “association (for joint action).” This means that the parties are united (brought together) by the covenant. In the light of the Bible and especially in the light of the revelation of the one God in the New Testament, this idea must be decidedly rejected. “For there is one God” (1 Tim. 2:5).

No covenant of works

You will also look in vain for a Covenant of Works in the Bible. Nor does it acknowledge a “Covenant with Adam.” The frequently cited reference to Hosea 6:7 (“But like Adam they have transgressed the covenant”) does not help either, as the issue here is that “they,” the Israelites, have broken “the covenant,” which is the Sinai covenant. This is parallel to Adam, who also transgressed (disobeyed God’s command)—but there’s no mention of a covenant with Adam.

Additionally, the supposed content of the assumed “covenant” with Adam is not aligned with the facts. Covenant theology asserts that God promised Adam (eternal?) life as a reward for obedience. This is also incorrect. God did not give Adam a promise like, “Do this and you will live,” but quite the opposite: He said, in effect, “If you do this, you shall surely die” (cf. Gen. 2:17)!

No covenant of grace

We now come to the third and central “covenant,” the Covenant of Grace. This, too, is sought in vain in the Bible. Covenant theologians correctly assume that salvation can only come through faith, but they are mistaken in their belief that the object of faith (that which must be believed) has been the same at all times (namely Christ). A look at Genesis 15:6 and Romans 4:3 shows the opposite.[3]

It is held that every covenant that actually appears in the Bible should then be seen as an expression of the Covenant of Grace. But this is extremely problematic and not in line with the Bible:

How is it possible that the unconditional covenant with Abraham and the conditional Sinai covenant belong to the same covenant?

Of course, God also showed grace under the law. Of course, God provided shadows of Christ in the sacrificial regulations, which pointed to His sacrifice and redemption. However, this changes nothing about the fact that a conditional covenant (which could be broken and was broken) is fundamentally different from an unconditional covenant, which cannot be broken.

How can we explain that the old covenant and the new covenant are expressions of the same Covenant of Grace? The former was so imperfect,[4] that it needed to be abolished. Even its name “first covenant” proves—as the Bible explicitly states—that the old covenant had to disappear (Heb. 8:7)! And Jeremiah had already contrasted these two covenants: He characterizes the new covenant by it not being like the old covenant (Jer. 31:32)—and this contrast is maintained in the Epistle to the Hebrews (Heb. 8:9).
In covenants in the Bible, there are always two parties and an official statement on the content that is agreed upon. Both parties are aware that a covenant is being established. Nothing in the Bible suggests that God makes a covenant with every believer, promising to save him.

The Covenant of Grace is the greatest fiction (I emphasize both words) of Covenant Theology—and at the same time the load-bearing supporting wall of this system.

The consequences

Covenant Theology is based on the assumption that the unifying principle of the Bible is man’s redemption. To support this view, it constructs a Covenant of Grace and postulates that God has always dealt with man according to this “covenant.” This resolves the “problem” of apparent contradictions (e.g., that God gave Israel a law, but Christians are “not under law”). But a high price must be paid for this:

One must “read the Bible backward.”
One can no longer “take the Bible at its word.”

Reading the Bible backward?

The Covenant theologian must inevitably read the Bible “backward,” by presuming that believers in the Old Testament already had the light of the New Testament (since they are all supposed to have believed in Christ under the Covenant of Grace).

The following definition of the “Covenant of Grace,” written by an influential representative of Reformed theology, elucidates this problem. It reads:

“The covenant of grace is that gracious agreement between the offended God and the offending but elect sinner, in which God promises salvation through faith in Christ, and the sinner accepts this believingly, promising a life of faith and obedience.”[5]

Proponents of this view do not read the Old Testament in the light of the New Testament (which would be correct), but they project the New Testament back into the Old Testament. Did the believers in the Old Testament have “faith in Christ”? How could they? When Adam and Eve heard God’s prediction (Gen. 3:15) they were able to discern that a redeemer would come, specifically as a descendant of the woman. But they could not yet know about Christ and His completed work and justification through His blood. These things were only revealed when the “fullness of the time” had come.

The question then is, “Since when has the Christian faith existed?” Covenant theology says: The Christian faith has always been there. The Bible, on the other hand, speaks of a specific point in time when the faith, which was previously unknown, came:

“But before faith came, we were kept in custody under the law, being shut up to the faith which was later to be revealed. ... But now that faith has come, we are no longer under a tutor; for you are all sons of God through faith in Christ Jesus” (Gal. 3:23, 25-26).

It could not be stated more clearly: There was a time before faith came. Then “the faith” came.

Not taking the Bible at its word anymore?

If it is to be believed that God deals with all people at all times in the same way, then it cannot be that God deals differently with Israel as a nation than with the church (since both are supposedly the “people of God,” consisting of the believers under the currently effective manifestation of the “Covenant of Grace”). Consequently, it should not (or cannot) be that the Old Testament prophecies about Israel, the Kingdom of Peace, etc., are yet to be fulfilled. Therefore, one must argue that these promises are no longer to be fulfilled. To achieve this goal, without wanting to label God as a liar, one must consider the promises as “spiritually” fulfilled.

If Covenant Theology is to hold true, it must use a hermeneutic[6] that allows this kind of “spiritualizing.” This can only be achieved through a hermeneutic that abandons the literal sense of the Bible—where “necessary”—and instead uses an allegorical or spiritualizing approach. It must “redefine” terms and names (such as “Israel”) because some biblical statements (like, for example, Rom. 11:11, 27) otherwise do not fit into the chosen scheme. It relies on a hermeneutic that assumes that the Bible reader must ask what God meant, not what He said (here again, the foundation wobbles).

The lost hope and Christian life practice

Those who follow Covenant Theology lose a lot—particularly in terms of Christian hope and future expectation, but also our understanding of God and His faithfulness:

Without distinguishing between Israel and the church, God’s promises can’t literally come to fulfillment—despite His having made them. How does this fit with God’s faithfulness and reliability (Rom. 11:29)?
Without a literal future Millennial Kingdom, this earth will never be managed and governed to God’s glory and according to His thoughts. The fervent prophecies stating that the knowledge of the Lord will fill the earth, that there will be peace on earth, etc., are thus invalidated (Isa. 11:9; Hab. 2:14).
If one assumes that the Millennial Kingdom has already started, the need for Christ to appear in power and glory to establish His kingdom is removed.
Instead of waiting for the Lord, Christians are meant to believe that the 1,000-year Millennial Kingdom is already underway. The hope of heaven is replaced by political involvement on earth, attempting to improve the world.

A final comparison

The covenant theology perspective

Representatives of Covenant Theology see the advantage of their approach in believing they have found a unifying principle, namely one covenant with one goal for all believers of all times: the goal of redemption, brought about in the Covenant of Grace.

They see the disadvantage of the dispensational approach in the necessity to distinguish between different epochs of time, and in the mental difficulty asserting that God deals with different people in different ways, and in the assumption that the way of salvation must have changed.[7]

The dispensational approach

Proponents of the dispensational approach point to the following advantages of their understanding of the Bible:

You can take God at His word (see Building Block 1).
The apparent contradictions are resolved by taking into account the different dispensations that the Bible itself sets forth.
For this, you don’t need to superimpose a (non-biblical) system that comes from outside, but a biblical distinction from within.
The uniting principle is seen in the glory of God (which is to be esteemed even higher than the magnificent goal of mankind’s salvation).

In contrast, the covenant theologian’s approach has a number of serious weaknesses:

He uses a framework of thought that does not come from the Bible, but rather is “superimposed” on it from outside.
It is based on three “theological” covenants, all of which are devised and not mentioned in Scripture.
The “theological covenants” contain unscriptural elements (such as covenants between persons of the Deity, unconscious covenants, limitation of the offer of grace to the chosen ones, imputation of the practical righteousness of Christ, who supposedly kept the law “vicariously”).
Covenant theology fails to consider the biblical demarcations of dispensational epochs.
It downplays certain statements of the Bible or disregards them entirely (like, for instance, the new covenant being “not like” the old covenant, or that Christians are “not under the Law”), in order to do away with the differences the Bible makes between different dispensational epochs.
In order to maintain their framework, Covenant Theology is forced to give up the standard hermeneutics and instead use a hermeneutic that redefines biblical terms (like for example, Israel, the land, the throne of David, etc.).

Furthermore, it is an added challenge that this hermeneutic is not used consistently, but only where necessary to justify the system, i.e., with prophecies that are fulfilled after the resurrection of Christ.

Many parts of Old Testament prophecy cannot be explained (such as the unification of Judah and Ephraim, possession of the land in peace, etc.).
The result is that Christian hope is abandoned, and people feel at home where Christians should be strangers.
Covenant theology is particularly bolstered from two directions:
- from a political viewpoint that believes the expectation of a national future for the people of Israel hinders the peace process;
- from a practical perspective that believes the coming of the Lord is now increasingly unlikely, and earthly political involvement is more attractive than a heavenly hope.

And the Bible?

Of course, covenant theologians also have many Bible verses to hand in order to support their views. Many of the verses they frequently use are examined in Appendix 4: “And the hard nuts to crack? Or: Some difficult Bible verses.”

Not to preempt the discussion: It will become apparent that the refutation of these arguments almost always follows the same pattern, namely through a simple explanation of the context. For those who read the Bible dispensationally (that is, as it is), the context will prove to be an ally: The context supports the interpretation. But anyone who wants to impose a theological system (theological covenants) on the Bible has to consistently take verses out of context in order to justify their theological edifice.

Paying attention to the context, incidentally, is a biblical principle of interpretation. The context is the only true foundation of sound Bible interpretation. Here, “context” is not limited to the immediate vicinity of the text, but it encompasses the entire “pattern of sound words” (2 Tim. 1:13, nkjv 1995) and “no prophecy of Scripture is a matter of one’s own interpretation” (2 Pet. 1:20).

[1] From: “Discovering Biblical Dispensations – the Key to Understanding the Bible”, chapter 6 (see the link provided below, aber the footnotes).

[2] Both the covenant theology approach and the dispensational approach share this goal. The difference lies in that the latter takes the Bible as it is and distinguishes the dispensations that it recognizes. In contrast, the covenant theology framework, as we will see, is not genuinely biblical but is justified on “theological” grounds.

[3] More on this in the section, Building Block 2: Progressive Revelation.

[4] Not within Himself—for He came from God—but because of man’s weakness (Rom. 8:3).

[5] Louis Berkhof, Systematic Theology (Grand Rapids: Eerdmans, 1941), p. 277) [as cited in Charles Ryrie, Dispensationalism (1995), p. 184]

[6] Approach, interpretive methodology. More on this in the following section (Building Block 1).

[7] We have already addressed these objections in Chapter 3.

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From: Discovering Biblical Dispensations

The Key to Understanding the Bible

by Michael Hardt

Believers Bookshelf Canada, 2026

https://www.believersbookshelf.ca/products/discovering-biblical-dispensations-the-key-to-understanding-the-bible-michael-hardt