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British Monarchy

The Queen

The United Kingdom of Great Britain and Northern Ireland is a constitutional monarchy. Its members include England, Scotland, Wales and Northern Ireland. In the UK, the monarch has limited powers and reigns together with the governing body, the UK Parliament. The current monarch, Elizabeth II, is the queen regnant of the United Kingdom, and separately, the head of state of 15 Commonwealth realms. The Queen is also head of the Commonwealth itself, a voluntary association of 54 independent countries.

The Queen performs a range of duties, including summoning and dissolving Parliament, and giving assent to legislation passed by the UK Parliament, the Scottish Parliament, the National Assembly for Wales, and the Northern Ireland Assembly. The Queen also appoints various office holders, among them the prime minister and other government ministers, judges, officers in the armed force, and senior clergy of the Church of England. She also grants peerages, knighthoods, and other honors and awards.

Paying for the Monarchy

There are six sources of state and private funding for the Queen’s Royal Household:

State

  • Civil List
  • Parliamentary annuities
  • Grants-in-Aid
  • Government Departments

Private

  • the Privy Purse
  • the Queen’s personal wealth and income

In the fiscal year 2008, the Queen received £40 million (or about $57 million) from the Parliament in the form of the Civil List, Parliamentary Annuities, Grants-in-Aid, and contributions from various government departments. In addition, the Queen enjoys free postal service, reportedly worth £1.2 million (about $1.7 million). The Queen also received £12 million ($17 million) from private sources—principally from the Duchy of Lancaster. The Crown also own a large commercial venture—the Crown Estate, whose annual income reverts to the state.

The Crown Estate

The Estate is a statutory corporation owned by the Crown. Historically the possession of British monarchs, the Estate it is not private property and cannot be sold. The Estate is managed by the Crown Estate Commissioners. The Estate’s £6 billion (about $8.5 billion) portfolio includes major real estate holdings in London, largely in the Regents Street, Regents Park and St. James. The Estate also owns over 276,000 acres of agricultural land and various maritime assets, including 55 percent of the shore and all the seabed to12 nautical miles. In 2008, the Crown Estate generated annual profits over £211 million (about $300 million). The Estate’s revenues are paid each year to HM Treasury.

 

The Queen’s Income from the State and Private Sources 2008
Category (£ in millions) ($ in millions)1
State Fundinga    
Civil list £12.70 $18.05
Parliamentary annuities £0.40 $0.57
Grants in aid £22.00 $31.27
Government departments £4.90 $6.96
Total £40.00 $56.85
     
Securityb    
Royal security costs estimates2 £50.00 $56.85
     
Total State Funding £90.00 $127.92
     
Privy Pursec    
Duchy of Lancaster £11.90 $16.91
Duchy of Cornwall3 £16.00 $22.74
Total £27.90 $39.65

Sources:

The Civil List

The Parliament provides funding for the official expenses of the Queen as the Head of State and Head of the Commonwealth. Only the Queen and the Duke of Edinburgh receive an annual parliamentary allowance. The Civil List funding pays for catering, administration, housekeeping and furnishing, and court ceremonies, including garden parties, receptions, and official entertainment during state visits. In 2008, the Civil List amounted to £12.7 million (about $18 million). The royal expenditures covered by the Civil List includes a nine-car train, helicopters, and private planes.

Parliamentary Annuities

Prince Philip, the Duke of Edinburgh, receives, as the consort to the Queen, an annuity from the Parliament. This amounts to £359,000 annually (or about $570,000). In addition to Prince Philip, six other members of the royal family that carry out public duties receive parliamentary annuities at a combined cost of £1.6 million (or about $2.7 million) annually. The Queen repays this amount to the Treasury from the Privy Purse.

Grants-in-Aid

The Queen also receives funding from the Parliament, including grants for official travel, the upkeep of the royal residences, including Buckingham Palace, St James’s Palace, Clarence House, Marlborough House Mews, Kensington Palace, and Windsor Castle, and public relations. In 2008, Grants-in-Aid amounted to £22 million (about $31 million).

Government Departments

Some of the Crown’s expenditures are met by payments from UK government departments. In 2008, departments contributed £4.9 million (about $7 million) for the administration of the honors system, servants, palace maintenance, and overseas visits.

Privy Purse

The Privy Purse is the Queen’s private income, and is distinct from the Civil List. The Purse is financed primarily from the net income—£12 million (about $17 million) in 2008—from the Duchy of Lancaster. The income from the Duchy is used by the Queen for official and private expenses, including expenses incurred by other members of the royal family. The Queen also owns the Duchy of Cornwall. The Prince of Wales, the heir apparent, receives income from the Duchy of Cornwall (£16 million or about $23 million), some of which is used for his official duties. In 2008, the combined income for the Duchies amounted to £28 million (about $40 million).

Queen’s Personal Wealth and Income

The Queen’s personal wealth and income has never been publicly disclosed, despite efforts to determine what the monarchy has accumulated over centuries. Official secrecy and the exemption of the royal family from the UK Freedom of Information Act have thwarted efforts to determine what belongs to the Queen and what belongs to the state.

The Queen’s wealth and income are derived from her personal investment portfolio and private properties—the Balmoral and the Sandringham estates. The Balmoral estate includes a castle and 73,000 acres of agricultural land and woodlands. The Sandrigham estate consists of 19,000 acres of farmland and woodland. The value of the royal estates and the Queen’s income from both properties are unknown.

In 2001, Forbes magazine estimated that the Queen is worth about $420 million. This amount does not include the value of the Royal Collection, an extensive collection of paintings, drawings, furniture, ceramics, and other art objects on display at the principal royal residences. The Queen holds the Collection, worth about £10 billion (about $14billion) on behalf of the state. In 1992, the Queen volunteered to pay capital tax on her earnings, and from 1993, the Privy Purse and the Queen’s personal income are fully taxable.

Survival of the Monarchy

Will the British monarchy, a thousand year old institution, survive? It appears that for now, most Britons favor monarchy. When asked in a 2006 public opinion poll by Ipsos Mori, a leading UK research company, whether they favor a republic or monarchy, 72 percent of respondents chose monarchy. The same poll shows that the Queen remains popular with the public, with 85 percent of respondents saying that they are satisfied with the way the Queen is doing her job as monarch. However, only 52 percent of respondents believed at that time that Prince Charles will make a good king.

Although the Queen remains popular, there is a small but active republican movement in Britain advocating the abolition of the monarchy. The movement is fueled by the reports of profligate royal spending as well as by the spate of royal scandals gleefully reported by the British tabloids.

Despite the various setbacks, the royal family remains popular, and continues to be deeply embedded in the social and economic fabric of the Commonwealth. While subject to periodic criticism, the family provides patronage to 3,000 charities, contributes to commerce through the awards of Royal Warrants, and draws visitor and boosts the British £52 billion (about $74 billion) tourist industry.

The Costs of Other European Monarchies

A recent study of the cost of Europe’s royal families by Vrije University political scientist Herman Matthijs suggests that the British monarchy is the most expensive, with a reported annual cost of $67 million. The Dutch monarchy is the second most expensive, with an annual cost of $54 million. In contrast, the Spanish monarchy is the least expensive, with an annual cost of $12 million. However, direct comparisons are difficult because the cost of security, state visits, and the maintenance of palaces are not included for some monarchies.

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