Playground amenity was set up by diocese (6)
I believe the answer is:
seesaw
'playground amenity' is the definition.
'was set up by diocese' is the wordplay.
'set up' says the letters should be written in reverse (in a down clue, letters go up).
'by' says to put letters next to each other.
'diocese' becomes 'see' (both can mean a cathedral area).
'was' reversed gives 'saw'.
'saw' put after 'see' is 'SEESAW'.
(Other definitions for seesaw that I've seen before include "Plaything that's ridden up and down" , "Children's playground item" , "pitch" , "Fluctuate" , "Vacillate; playground feature" .)