Head of monastery, settlement not given initial precedence (8)
I believe the answer is:
priority
'precedence' is the definition.
(I know that precedence can be written as priority)
'head of monastery' is the wordplay.
'head' becomes 'prior' (I have seen 'Religious head ' mean 'prior' so perhaps 'head' could also mean 'prior').
'of monastery' becomes 'ity' (I can't explain this - if you can you should give a lot more credence to this answer).
'prior'+'ity'='PRIORITY'
'settlement not given initial' acts as a link.
I am not very happy about this link. Some or all of it may be part of another bit of the clue.
Can you help me to learn more?
(Other definitions for priority that I've seen before include "Something regarded as more important than others" , "Most urgent matter" , "The right to go first" , "Precedence in rank, the right to be first" , "preferential treatment" .)