Rev Coles, who had a big hit with Don't Leave Me This Way in the 1980s, said: "There's more bling in my vestry than in my dressing room".
The Church of England priest knows a thing or two about song and dance, having been a member of eighties pop duo The Communards, alongside Jimmy Sommerville.
His participation on Strictly was announced this morning on the Chris Evans Breakfast Show on Radio Two.
Gemma, 32, told listeners to her Key 103 radio show: 'I did disco dancing when I was ten, but that was high kicks and cartwheels'. I'm in it to wing it as they say.
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Lesley Titcomb, chief executive of TPR, said the agreement had come after "several months of robust negotiations". BSPS trustees Chairman Allan Johnston added: "It is the best outcome that could be achieved in the circumstances".
Gemma, who was born and bred in Bury, Greater Manchester, will be joining the likes of Saturdays singer Mollie King, This Morning's Ruth Langsford and EastEnders star Davood Ghadami on this year's Strictly.
"I'm 5ft 9in, I'm big for a girl, so as long as it's (her dance partner) someone tall and strong because I don't want someone lifting me and dropping me".
The 55-year-old said he had been "waiting by the phone for 11 years" to be invited on to the BBC1 show, and that he was "totally serious" about competing.
The journalist also said: "Cometh the hour, cometh the overweight Vicar with arthritis in his knees".
She said of the opportunity: "I am really flattered they have asked me, I never thought the words would be coming out of my mouth".