Royal Family: Civil List

Lord Brooke of Alverthorpe Excerpts

Wednesday 10th November 2010 Lords Chamber

[Lord Brooke of Alverthorpe]

My Lords, I am grateful to the noble Lord, Lord Berkeley, for giving us the opportunity for this debate. My last intervention on a Royal Family issue was when I asked the noble Lord, Lord Mandelson, when he was president of the Board of Trade, whether the Government would consider promoting or supporting a special classic horse race in 2012 to celebrate Her Majesty the Queen’s diamond jubilee. A number of people were quite interested in that and I still hope there may be a possibility that such a unique race may be run because I believe that Her Majesty has been an outstanding public servant, and that when we come to 2012 we should do everything in our power to let not just the country but the world see what we think of her. So I come in as a supporter of the monarchy and not as a republican. I do not believe that the noble Lord, Lord Berkeley, was speaking as a republican either, but, like him, I am also interested in how public money is defrayed, especially at a time of extreme economic constraints that are being forced through at the moment by the coalition Government. So I am interested in access to financial and related information on public expenditure in the way that my noble friend Lord Berkeley was seeking to shed revealing light on it.

It has not always been easy to access the Royal Family’s expenditure and its income—it is difficult to trace the real overall expenditure when a range of departments pick up a range of different bills—and freedom-of-information exemptions in certain areas prevent people from securing certain pieces of information. But it would be churlish not to say that there has been greater openness in recent years and that the Royal Household has made major efforts to increase its efficiency and to contain the growth of costs that we saw some years ago. The Civil List has been frozen for a number of years and it will remain frozen at £7.9 million for the coming year.

The present Civil List processes will then be changed and the Chancellor of the Exchequer, in his words,

“will propose a new means of consolidated support for Her Majesty for the future”,

and that will come at a later date. As part of this change, the Royal Household has agreed that, in future, Civil List expenditure will be subject to the same audit scrutiny as other government expenditure both through the National Audit Office and the Public Accounts Committee of the House of Commons. This is a strong step forward and should be welcomed by all. It is good that the Royal Household has been prepared to go down this route.

However, that progress was somewhat tarnished last month when George Osborne announced that the existing Civil List arrangement, which determines how much the state pays to the Royal Family, should be abandoned. Instead, the Royal Family will get 15 per cent of the profits from the Crown Estate’s £6 billion property portfolio. I shall give the reasons for making that comment. Over the past 10 years, the capital value of the Crown Estate has increased by £2.6 billion. The estate owns around £6 billion of land and other assets and chattels that last year brought in a profit of £210 million. But as my noble friend Lord Berkeley indicated, and as the high degree of press coverage of this shows, there are substantial rumours around that the profits of the Crown Estate are set to rocket in the coming decade as revenues come in from offshore wind turbines installed on the Crown Estate seabed. It is projected that the development of wind turbines and farms could more than double the current annual profits of the Crown Estate.

Developing wind power is expensive, especially when it is developed offshore. Progress to date has been slow because of the high initial investment costs—sufficiently so that, notwithstanding the current restraints we are facing, the Government, in trying to accelerate development and attract more money into developing offshore wind farms, recently stated that they would be prepared to make available an extra £200 million of subsidies for offshore wind farms and for the port facilities and grid links that will be needed to handle the electricity. Thus the Royal Household will additionally be indirect beneficiaries of a very substantial taxpayer investment of £200 million, which will help to boost Crown Estate profits. From those, the household will then take 15 per cent.

We already spend more on our Royal Family than is spent on any other royal family in Europe. It would be ironic if these new arrangements mean that, for the first time since Parliament bailed out George III’s debts by taking over the management of the Crown Estate and introducing Civil List payments that have to be negotiated between the Government and the Royal Household to determine its expenditure, this new coalition Government will now entirely reverse the system. Instead, our greatly indebted state—we are told this every day—will hand the Royal Family an independent source of income from the Crown Estate that could greatly outstrip the household’s current and anticipated costs. It does not surprise me that Prince Charles, who has an aversion to onshore wind farms, has now become a well-known campaigner for offshore wind turbines. If he was a parliamentarian, I think he would be requested to declare a personal interest before making any speeches about the development of green marine energy, but that is an aside that perhaps I should withdraw.

I will be interested to hear from the Minister whether my understanding of what is about to happen is correct. I should also like to know if there will be any public consultation on the review process that has now been put in train, the extent to which Parliament will be involved in that consultation and, indeed, whether the public will be involved. I ask this especially since only in the past few days Her Majesty the Queen has launched a Facebook page that has attracted a substantial amount of interest, with 100,000 people logging on to it. Answers to these questions and the detail that will arise from these topics are things that ought to be in the public domain. I think that more openness would strengthen the Royal Family’s position rather than weaken it because, as we all know in a modern society, secrecy creates more problems than it leads to solutions.

My final and perhaps most important question is this. If I am right and there is to be a 15 per cent take from Crown Estate profits, whatever they might be, given that there could be very substantial increases in those profits, have the Government given any thought to the need for a cap? How much could be paid over to the Royal Household? I ask this because even though the household will declare its expenditure to the NAO and so on, it is conceivable that there could be a very substantial gap between the costs of running the household and what the profits turn out to be by 2015 or 2020. In the interests of the Royal Family, I do not think that that would be the best way to go. There is a requirement for a reasonable approach to be taken, and we could end up with an option, the one we are now considering, that would lead to a level of unreasonableness that would be unacceptable to the public at large.