Time for a modern monarchy?

Sandpiper at English Wikipedia Public Domain

By Peter Rowberry and Russell Bruce

Celebrations for our 96-year-old monarch’s 70 years on the throne are over but doesn’t alter the challenges we are facing, affecting almost all her people now the 4 day event is over; increase in fuel prices, shortage of food and other raw materials, increasing cost of household energy, all of which have contributed to inflation and the cost of living crisis. Does this crisis affect the royal family as much as the man/woman in the street? Should it?

That there would be events marking a 70 year reign, 7 years longer than Victoria, was to be expected, but the scale of the ‘celebrations’ was not without criticism given the times. The Gold Coach being wheeled out was an expression of extraordinary wealth many found offensive. The Queen herself is known to dislike travelling in it but the Palace bureaucrats dragged it out anyway despite it being a hugely inefficient form of horse drawn transport. That made its appearance a metaphor for the UK’s position in today’s world, flamboyant, inefficient with an overblown sense of its own importance.

Multiple ‘ownership’ models confuse the totality of royal ownership of a vast property portfolio

We have looked though the various palaces, estates, castles, and smaller houses with a connection to the Royal Family to provide some overall context for a massive property portfolio that is divided up under various ‘ownership’ models that provide an illusion of less scale than what the totality actually is. We have also found a castle in Scotland that is not mentioned in public lists of Royal property.

We examined a total of 23 major royal properties. The Duchy of Lancaster which provides, income to the Queen is a vast land and property portfolio managed in the interests of keeping the monarch provided for. The duchy consists of 45,550 acres of land holdings; rural estates, farmland, urban developments, historic buildings and commercial properties across England and Wales.

Duchy of Cornwall; three major properties; Highgrove House, Llwynywermod and Tamarisk are controlled by the Duchy of Cornwall (Charles) as well as 135,000 acres of land across South West and Southern England and dotted with multiple properties.

The Duchies act like giant icebergs ‘hiding’ multiple properties across England and Wales. The Queen and Charles voluntarily pay tax on their income after deducting costs and making new investments, some financed by sales. They also voluntarily pay Capital Gains Tax.

Crown properties; of the 13 crown properties only 6 fall into the large category like Buckingham Palace and Windsor Castle The remainder are smaller, if not actually small, and linked to the big 6 or provide accommodation for royals at some distance from the throne.

Private properties; Queen – Sandringham, Balmoral Castle and Craigowan Lodge. Prince Charles; Birkhall.

The one offs

Gatcombe Park is the home of Anne, Princess Royal. It is a privately owned home bought by the Queen for between £500,000 and £750,000 in 1976. The Crown paid for the renovation and redecoration.

Bramwell Manor is a private property previously the home of the Duke and Duchess of Gloucester. it is now occupied by Windsor House Antiques which is a private company established in Leeds by D Kevin Smith in 1957. The only connection with the House of Windsor is they are since 2017 the occupants of Bramwell Manor. We presume there is a financial arrangement for their use of the property as an antiques centre.

Anwar Hall is the country and principal home of the Duke and Duchess Cambridge (William and Kate) located northeast of Kings Lynn and 3 km east of Sandringham. It was acquired by the Sandringham Estate sometime after Queen Victoria purchased the property.

That’s the quick summary of a massive and complex property portfolio. Some additional information is given in later sections as is detail of the ‘missing’ castle in Scotland.

Are we getting value for money from our royals?

At present, funding for the monarch’s official duties comes from three different sources:
• The Civil List, replaced by the Sovereign Grant in 2012, and in 2020-21 amounting to £87.5 million

The Sovereign Grant Act 2011 replaced the Grant in Aid method of funding the monarchy. This is the link to the Sovereign Grant and Sovereign Grant Reserve Annual Accounts for 2020-2021. It is very detailed in the extent of the breakdown covered, contains some surprising information and is like wading through treacle unless you are an accountant and tax specialist.

“Official expenditure met by the total Sovereign Grant in 2020-21 amounted to £87.5million (2019-20: £69.4million) an increase of £18.1million (26%) compared to the previous year. Expenditure on property maintenance of £49.5 million (2019-20: £38.3 million) included £31.6million expenditure on the Reservicing of Buckingham Palace (2019-20: £16.4million). In addition, £3.8million was spent on capital assets (2019-20: £12.2million), of which £2.5million (2019-20: £8.2million) related to Reservicing.”

Also, the Queen and the Prince of Wales have their own wealth. In September 2020, Royal finance expert David McClure wrote that the monarch’s personal fortune was around £400 million and Prince Charles personal wealth £100 million.

The management of the Crown properties is carried out by a dedicated unit of The Royal Household. The Sovereign Grant accounts are managed by a separate unit. The Royal Household acts as the management and accounting service for the monarchy. The total staff of a reigning monarch is around 1000 with the Lord Chamberlain’s Department accounting for around 700.

3 other areas of financial interest

The Duchy of Lancaster

Lancaster is a private estate providing income to the reigning monarch. It was established in 1351. Income from the Duchy forms part of The Queen’s Privy Purse income. The Privy Purse is largely used to meet official expenditure incurred by the monarch and other members of the Royal Family not met by the Sovereign Grant, It is taxed to the extent that the income is not used for official purposes. The Queen, as Duke of Lancaster, receives all the income from the Duchy, around £20 million a year. The estate consists of a portfolio of lands, properties and assets held in trust for the sovereign and is administered separately from the Crown Estate. The duchy consists of 18,433 ha (45,550 acres) of land holdings (including rural estates and farmland), urban developments, historic buildings and some commercial properties across England and Wales including the Savoy Estate in London. The Queen voluntarily pays taxes on income she receives from Duchy investments.

Duchy HQ Lancaster House, London GrindtXX own work CC BY-SA 4.0

Duchy of Cornwall

Duchy of Cornwall income funds the private and official expenditure of The Prince of Wales and The Duchess of Cornwall and is taxed to the extent it is not used to meet official expenditure. The Duchy was established in the reign of Edward III in 1337. It was created to provide income to the heir to the throne and will pass to William when Charles inherits the throne. The principal activity of the duchy is the management of its land holdings in England of 135,000 acres in Dartmoor, Herefordshire, Somerset and almost all of the Isles of Scilly. The latter is a recent addition made by William.

The Prince of Wales receives all the income from the Duchy of Cornwall, which in 2019 amounted to £22.3 million. He voluntarily pays income tax on this income at a rate of 45%, after deducting all his royal expenses. He also funds the public duties of the Duke and Duchess of Cambridge and some of their private costs. Prince Harry and Meghan Markel, Duke and Duchess of Sussex, quit as senior royals at the end of the financial year 2020. At the time, it was confirmed Charles would continue to make financial contributions from his private wealth to the Sussexes as they began their new life in the US.

Duchy Accounts

Both Duchies have to produce accounts that have to be approved by the government. The official expenditure of the Prince of Wales is not audited by the National Audit Office. The Duchies are considered Crown bodies and are exempt from paying corporation tax.

The Royal Collection

Lucas Cranach the elder: Apollo and Diana, Public Domain

The Royal Collection of the British royal family is the largest private art collection in the world. The collection consists of works of art of all kinds and is held by The Queen as Sovereign in trust for Her successors and for the Nation. The Royal Collection’s costs are met by The Royal Collection Trust, a registered charity, from visitor admissions to the 13 Occupied Royal Palaces and related activities. No government money is provided.

The Royal Collection was set up as a new department of the Royal Household in 1987 to oversee the Royal Collection. It is financed by the commercial activities of a limited company, Royal Collection Enterprises.

Due to closure of the Royal Palaces during Covid income fell with only 600,000 visitors who saw items from the Royal Collection in royal palaces during 2020-21 (2019-20: 7.9 million). That is a drop in income of £7.3 million and a reduction of 92.4%. Regular exhibitions are held in the Gallery at the Palace of Holyrood.

The Royal Collection consists of around 1 million items; paintings, drawings, photographs, watercolours, porcelain, tapestries, sculpture, manuscripts, clocks, decorative arts and more. A collection of jewels is held at Windsor Castle. Some items are held separately by the Queen such as the Royal Stamp Collection left to her by her father and paintings, including a Monet, left to her by the Queen Mother.

Items are lent for exhibitions around the world. Due to the interests of different monarchs over centuries the Royal Collection today is an eclectic collection with no particular cohesive themes.

Costs, income and recent changes

The campaign group Republic assert that the full annual cost of the British monarchy to be at least £345 million a year, if the lost revenue from the two duchies, security, costs met by local councils and police forces, and lost tax revenue are included. Republic are responsible for the current poster campaign – Make Elizabeth The Last .

As well as the direct aid to cover royal expenses, we also have “grace and favour” accommodation, which are owned, either by the monarch, or by the Houses of Commons and Lords, and occupied by people seen to have offered a useful service to the crown or parliament, often rent free. Parliament has, within its gift, some of the classiest accommodation in the kingdom: 10 Downing Street, Chequers, Dorneywood, Admiralty House, One Carlton Terrace, Belgravia, and The Lord Chancellor’s apartments, Chevening.

The Royal Family is said to own only two estates: Balmoral Castle and Sandringham but we have uncovered a more complex picture of ‘hidden private ownership’. The royal family including their more distant dukes and Princess Alexandra have access to 13 Crown properties.

Palaces owned by the Crown: Buckingham Palace, Windsor Castle, Palace of Holyroodhouse, Hillsborough Castle, Clarence House, Kensington Palace, Frogmore Cottage (Windsor), St James’s Palace, The Royal Lodge (Windsor), Ivy Cottage (Kensington), Bagshot Park, Wren House (Kensington), and Thatched House Lodge. Of the 13 properties the 6 in bold are large Crown properties. The remaining 7 are linked to one of the big properties or used by minor members of the Royal Family

Up until 2011, Prince Andrew’s daughters, Princess Beatrice and Princess Eugenie had received protection at a reported cost of £500,000 per year. They no longer receive this protection directly. However, there is a police task force, the Royal and VIP Executive Committee (RAVEC), that ensures the Royal family and public figures have round the clock protection. This is primarily funded by the state.

Prince Harry and Meghan Markle have raised a complaint that, following their well publicised end to royal duties and the desire to live on their private income, they would no longer receive protection paid for by the UK state if they visited. The Met Police have made their position clear. They will protect the Sussex family for more formal events like the Jubilee celebrations or Prince Philip’s memorial service, but when they come for personal visits their personal security detail should more than suffice.

Balancing the cost of the royal family, to some extent perhaps, is the income that having a royal family generates. In 2019 inbound tourism was setting new records with visitors spending £28.4 billion, up 7% on inbound spending in 2018. Visiting the UK is very popular with Americans, there being around 3.8 million visits in 2016. Trooping the Colour is probably the only frequent event open to the public. Visiting palaces is a major visitor activity and not confined to monarchies.

The Queen, until recently, could also be seen travelling to and from the State Opening of Parliament on the Mall and Whitehall, but the ceremony is not open to the public. The Queen also attended the Maundy Money ceremony, where coins to the value of her age are donated to those whose voluntary efforts, especially in the Church, are rewarded. As well as money, it was expected that the monarch would be humble in front of the people and wash the feet of the recipients, although Queen Victoria put a stop to this.

Parts of Royal Palaces are closed or restricted when the Queen or heirs visit. With such a large property portfolio controlled by the Queen, Charles and William there is scope for related smaller properties to generate increased income from tourism and paying quests.

Visiting Palaces is a major visitor activity

And it is not confined to monarchies. The Palace of Versailles is one of the most popular tourist attractions in the world -15,000,000 people visit the Palace, Park or Gardens every year. The income after running and staff costs plus maintenance goes to the French government. Other European republics use their former Royal Palaces as tourism attractions

Monarchies are a minority constitutional arrangement in Western Europe accounting for just 7 out of 27 countries in the EU. The monarchies are Belgium, Denmark, Luxembourg, Netherlands, Norway, Spain and Sweden. Lichtenstein is a Principality and Switzerland a Republic. Neither is in the EU although not as cut off in their relationship with the EU as the UK.

Galerie des Glaces Palace of Versailles France. Myrabella/Wikipedia Commons CC BY-SA 3.0

Windsor Castle

Sandpiper at English Wikipedia Public Domain

Windsor Castle is a major tourism destination. It is the oldest and largest inhabited castle in the world and much enlarged and frequently remodeled since Norman times. It has 1000 rooms. 18,000 bottles of wine are kept in the cellar.

Windsor normally received around 1 million visitors a year but after Prince Harry and Meghan Markle’s Windsor wedding in 2018 it became the UK’s biggest tourism destination with 1.8 million visitors.

In 2019/20 Windsor had 1.6 million paying visitors. That is a lot of visitors but it does not stack up against Versailles with 15 million visitors, 838% more than Windsor.

Kadriorg Palace Estonia

Kadriorg Palace Estonia Photograph Russell Bruce

Kadriorg Palace is an 18th-century Petrine Baroque palace in Kadriorg, Tallinn, the capital of Estonia. After the successful 1710 siege of Tallinn during the Great Northern War, Peter the Great bought a small manor house at Lasnamäe for his wife Catherine. Russia has a long history of invading surrounding countries. The building of the new palace began shortly afterwards. It has a new use today as the Kadriorg Arts Museum

Kadriorg means Catherine’s Valley

Just two, of many examples in republics in Europe, that have no difficulty repurposing palaces when the monarchs are no longer required.

The ceiling fresco in the great hall Kadriorg Palace. Pierre Andre Leclercq- own works CC BY-SA 4.0

The Palace of Holyrood House

Holyrood Palace with associations of Mary Queen of Scots and Bonnie Prince Charlie has long been open to the public so visitors can view the blood stain from the murder of her private secretary. David Rizzio murdered in her presence.

Mary Queen of Scots Private Chambers

The 16th-century historic apartments of Mary Queen of Scots and the State Apartments, used for official and state entertaining, are open to the public throughout the year, except when members of the Royal Family are in residence. Paying guests were first allowed to visit Queen Mary’s apartments at the end of the eighteen century by the then Duke of Hamilton. The Dukes of Hamilton are Holyrood’s hereditary keepers.

The story of the ‘missing’ Scottish castle

After the death of George VI The Queen Mother in 1952 bought the semi-derelict Castle of Mey in Caithness and restored it over the years. She visited every year in August and October until her death in 2002. It was generally understood she left it to Prince Charles on her death but it is not that straightforward. In 1996 she passed the castle, policies and farm over to the Queen Elizabeth Castle of May Trust. The president of the Trust is Prince Charles.

After 2002 the castle and gardens were opened to the public 7 days a week from 1 May to 30 September except for 10 days when Charles and Camilla usually stay from end of July to early August. The Trust opened a new Visitor Centre in 2007.

Major renovation was carried out in 2018. In January 2019 stewardship of the Trust passed to The Prince’s Foundation. Charles is president of the Foundation. To increase income Granary Lodge was opened in May 2019, converted from the previous stables and granary. Granary Lodge is a 10 bedroom bed and breakfast in the castle grounds and an early venture under the stewardship of the Prince’s Foundation.

Castle of Mey August 2014 by Orikrin1998 own work CC BY-SA 3.0

The creation of trusts, combined with opening as a visitor destination, is not unusual to keep historic buildings going. Profits from Granary Lodge are used to maintain and operate the estate as a tourism destination. This is another example of a senior royal adding a new property to the overall portfolio.

The creation of the Prince’s Foundation is structured around Charles particular interests. Whether on becoming King he changes it into The King’s Foundation or passes onto William to take forward is unknown. Time will tell.

Comparison with European monarchies

In comparison with other monarchies around Europe, the cost of the UK royals is high. The Swedish royals cost the state around 71 million crowns, or £5.7 million. The Belgian royal family received $14.6 million, or £11.7 million, in public money in 2018. The Dutch royals cost the state €48 million, or around £40.5 million a year. The Norwegian monarchy is one of the most expensive, costing around $72.3 million a year, or around £58 million. Only the Monaco royal family costs are more per head of population than that of the UK, costing €43.5 million in 2015, or £37 million sterling. Relations between Monaco and the EU are conducted through France. Monaco is in the EU customs territory and participates in certain EU policies. It is not in the EU but has a relationship Brexit Britain does not seek.

After independence Scotland would still need a national head of state, with a constitutional role more restricted than that which operates in the UK. The culture and history of the nation does not depend on the existence of a monarch. It may be that electing a head of state could be desirable. A more restricted monarchy, with much of their assets returned to the state is another option. This will be an ongoing debate which should be kept separate from the campaign for independence. It is time to end all the secrecy about royal wealth and income.

The Taxpayers’ Alliance, a body we rarely agree with, are calling for more transparency. They have said “By budgeting the costs of royal engagements, taxpayers can better assess value for money, funding a small but effectively resourced royal family which is less wasteful and more in tune with the public. This way, the monarchy will no longer be immune to economic hardship and share in the struggles of its subjects. This does not mean they will become a budget monarchy. But value for money applies to everyone – prince or pauper.”