Refurbishing Buckingham Palace helps push royal spending up 17%, cut into reserves
Royal finances under scrutiny with annual release of Sovereign Grant report
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Money — along with how taxpayers' money is spent — can often be at the root of controversy and debate. So it came as no surprise when headlines in recent days focused again on the Royal Family's finances, along with what some outside palace walls would consider, at the very least, an unusual scenario: that a royal charity might be the recipient of bags full of cash.
Focus on the Royal Family's finances was sparked in part by the annual release of the report on the Sovereign Grant, the British taxpayer-funded payment made to the family each year. It comes from a percentage of the profits made by the Crown Estate, the independent commercial business that manages property owned by the Crown corporately (not the Queen personally), and covers spending on official travel and duties, property maintenance and operating costs for the Queen's household.
The Sovereign Grant came in at 86.3 million pounds for 2021-22, according to the report. But total spending for the year was 102.4 million pounds, an increase of 17 per cent over the previous year, spurred in large part by a 10-year refurbishment project going on at Buckingham Palace. (A Sovereign Grant reserve was tapped to help make up the shortfall.)
"At 54.6 million pounds, by far the largest item of expenditure — at almost half of all expenditure — is the reservicing of Buckingham Palace, which shows that this program is now in full swing," Craig Prescott, a constitutional expert at Bangor University in Wales, said via email.
But trying to fully understand how royal finances work can be extremely hard.
"It's inherently difficult, because there's different overlapping elements," Prescott said. "There's the Sovereign Grant, the Duchy of Lancaster [a private estate owned by the Queen], and for Prince Charles, the Duchy of Cornwall — from which the private offices of the Duke and Duchess of Cambridge are paid for. Some of the income from the Duchy of Lancaster goes towards some of the expenditure of the monarchy not covered from the Sovereign Grant."
No matter the source or complexity of the funding, the annual release of the report puts royal finances under public scrutiny. This year, it also comes against a public backdrop of fiscal strain and a cost-of-living crisis in the U.K.
The report's release is "always not a particularly easy day for the Royal Family," ITV royal editor Chris Ship said on the network.
Ship said a royal official explained it like this: "There is always a tension between things like travel and demands for the Royal Family to be all over the country, indeed all over the world. And that tension is something they have to deal with every year, but particularly this year, because of the crisis lots of people are living through."
Michael Stevens, the keeper of the privy purse, said the year "was not without operational and financial challenges."
But the year did reflect "some return to normality in many ways for the royal household," with in-person engagements, travel and visits from foreign heads of state, he said in a post on the Royal Family's website.
Travel costs, for example, increased from 1.3 million pounds in 2020-21 to 4.5 million pounds, with the most costly trip being the weeklong visit by Prince William and Kate, Duchess of Cambridge, to the Caribbean in March, at 226,383 pounds.
The pandemic continued to affect royal revenues, with paying visitors to the royal palaces restricted.
"While the reservicing program continued to be carefully managed to match projected funding, there was a significant increase in work against a hard deadline to enable Buckingham Palace to be at the centre of the Platinum Jubilee celebrations," Stevens said. "On all fronts we were pleased to deliver against our plans."
The numbers at the heart of the Sovereign Grant don't include some costs related to the royals, including security.
That is a significant point for Republic, a lobby group that wants to see the monarch as the British head of state replaced with an elected president.
In a media release ahead of the Sovereign Grant report, Republic CEO Graham Smith said the Palace needs to answer "a few serious questions."
"Can this expenditure be justified? Can we get a head of state that costs less than this, so we can spend that money elsewhere? Why is the monarchy not facing significant cuts, while essential public services have been cut time and again over the past decade? Is this an ethical use of public money? What else could we afford for that amount?"
Other questions around royal money arose recently with reports that Prince Charles had accepted a cash donation from a senior Qatari politician — of about 2.5 million pounds, in a suitcase and carrier bags — for his charity a few years ago.
That was quickly followed by reports that such a thing would not happen now.
"The concern is that is, or has it been, possible to 'buy' access to the heir to the throne by making a donation, and why would someone be interested in acquiring such access," Prescott wrote.
"Regardless of the legalities of the situation (and it seems that no wrongdoing has occurred by simply accepting a cash donation which went straight to the relevant charity), the question is why did the donations take place in this way, and did the former prime minister of Qatar get anything in return?"
Much of this could have been avoided if charities with close links to the Royal Family made their donations public on websites or in an annual report, Prescott said.
"At the end of the day, the problem arises because in recent decades, the Royal Family's charitable activities have extended to doing more than simply being a patron of a charity."
They're now initiating or creating charities that do charitable work themselves, Prescott said.
"This brings them closer to fundraising, and questions then flow from this."
Still adding things up
While royal finances were the focus of the Sovereign Grant report in the U.K. the other day, total costs in Canada for the royal visit by Prince Charles and Camilla, Duchess of Cornwall, in May are still being added up.
Canadian Heritage, the federal department overseeing the visit, said just before Charles and Camilla arrived for the three-day tour that final costs would be made public once it was over.
That tally has not been completed "and this will still take some time," a Canadian Heritage spokesperson said via email on Thursday.
"Every royal tour is different, and costs covered by Canadian Heritage can vary; they may include travel, accommodation, meals, transportation from venue to venue, artist fees, rental of meeting rooms, rental of equipment, printing of documents, accreditation, translation, media centres and their operations, etc."
Those costs don't include security, which is covered by the RCMP.
An RCMP spokesperson said this week that it is still looking into a request for security costs for the visit by Charles and Camilla that took them to St. John's, Ottawa and the Northwest Territories.
We'll keep asking, and let you know when we hear more specifics on the trip costs.
A revised job description
Money may have been the main focus of the Sovereign Grant report, but the report also offered insight into other issues.
"I think in general, the change in description reflects the more fluid way in which the Palace now operates, with functions being exercised on her behalf by other members of the Royal Family, while ensuring that the Queen unambiguously remains 'in charge,'" Prescott said.
A gradual transition has been playing out for a few years now as senior members of the Royal Family have been taking on more of the duties that had been carried out by the Queen, now 96 and dealing with mobility issues in recent months.
Prescott said the most important element in the revision is a reference to how the Queen, in carrying out her roles as Head of State and Head of Nation, is "supported by the Sovereign Grant, and by members of the Royal Family who undertake official duties on behalf of Her Majesty."
"This covers moments such as when Prince Charles and Prince William deputized for the Queen at the state opening of Parliament," Prescott said.
"Who knows what the future brings, but this will cover that type of thing happening in the future."
The Sovereign Grant report also included an environmental review and some information on human resources within the royal household.
As of March 31, 9.6 per cent of staff were ethnic-minority employees, up from 8.5 per cent last year. The target for this year is 10 per cent.
"It's not easy to write about your husband. I bit through several pencils."
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