Sorry she ONLY got a 5% rise this year. She'll be scared to turn her heating on at this rate.
Handing out Maundy money is a royal tradition - but how does the Queen get her own cash?
It's that time of year again.
Royal aides are gearing up to get their annual battering as they open their account books to reveal how they have spent our money.
Sir Alan Reid, Keeper of the Privy Purse, (there is no longer an actual purse but if there was it would be massive) will tomorrow spill the beans on how the Sovereign Grant has been spent in the financial year ending April 2014.
Republicans and Monarchists always start arguing at this time of year, shouting different facts and figures at each other. But many of you reading this will quietly be wondering what exactly is the Sovereign Grant (go on admit it, it's OK).
That's why we are here to help you navigate your way through the web of intrigue that is royal finances.
What exactly is the Sovereign Grant? How is
the Monarchy funded? How rich is the Queen? And how much does she cost us?
If you are thinking of joining the debate this year here is our FAQ guide...
Where does the Queen get her money from?
Make no mistake about it, the Queen is a rich lady. She is rich in her own right, meaning that if she were to jack it all in tomorrow (not going to happen) she would still be sitting pretty in a mansion somewhere. But a large part of the money she receives is because she holds the role of Sovereign. Keeping it simple, she has three main sources of income:
- Private income
- The Privy Purse/Duchy of Lancaster
- The Sovereign Grant
What is her private income?
The Queen's private income is money from her personal investment portfolio and inherited private estates – which includes Balmoral Castle and the Sandringham Estate.
According to the Sunday Times Rich List 2014 the Queen is worth £330 million and ranked 285 in the world. But this can only be a guess because the Queen is not required to make her private funds public.
Estimates of the Queen's personal wealth also sometimes mistakenly include things like treasures from the Royal Collection, the Crown Jewels and official residences like Buckingham Palace which are not hers to sell.
Basically, she's rich, but we don't know how rich and probably never will. She has paid tax on her personal income since 1993 but, again, we don't know how much.
285
Queen's Ranking in Sunday Times Rich List 2014
£330m
The Queen's worth, as estimated by Sunday Times
What is the Privy Purse and Duchy of Lancaster?
The Duchy of Lancaster is land, property and other assets of about 18,000 hectares in England and Wales.
It has existed since 1399 to provide an income for
the Sovereign – who is also known as the Duke of Lancaster (yes, even though the Queen is a woman she is known as the Duke of Lancaster).
The income it generates is referred to as the Privy Purse.
The Queen cannot do what she wants with the Duchy – it is managed and run for her – but she receives all the net profits, which in the financial year ending April 2013 amounted to £12.5 million.
This is generally considered to be her private income – although republicans argue that it is money that would go to the Treasury if we didn't have a monarchy (no Sovereign = no Duchy) and so should be considered public funds.
The Queen voluntarily pays income tax on the profits, but the annual accounts do not say how much. The Duchy does not pay Corporation Tax.
The Queen uses the money to pay for private and official expenditure – including meeting expenses of
members of the royal family such as Prince Andrew, Prince Edward and Princess Anne.
She also uses it for the upkeep of Balmoral Castle.
£12.5m
2012-13 Duchy of Lancaster net profits
What is the Sovereign Grant?
The Sovereign Grant is a lump sum given to the Queen by the Treasury each year to carry out her official duties.
It pays for the upkeep of occupied official residences such as Buckingham Palace and Kensington Palace, royal travel, investitures, garden parties etc.
It was introduced in 2012 to roll several grants (eg the Civil List, Royal Travel Grants-in-aid) into one to be more simple (huh, as if any of this is simple).
In the financial year 2013-14 the queen got £36.1million. In the financial year 2014 to 2015 she will receive £37.9million.
How much she's given is determined at 15% of the profit of the Crown Estate but she can never get less than the previous year, even if the Crown estate profits fall.
Sovereign Grant
£36.1m
(2013-14)
£37.9m
(2014-15)
5%
Queen's pay rise
What is the Crown Estate?
The Crown Estate is a large portfolio of land, now worth around £8.1 billion, that was historically the property of the Monarch.
How they got all the land (which includes almost all of the UK seabed) is a long and complex story (aren't they all) but George III (the one famous for going mad) inherited it when he came to the throne in 1760.
The funding and expenditure of the Monarchy was different then (heck, everything was different then).
King George was paying the salaries of judges, ambassadors and civil servants (then called the Civil List) from the money from the Crown Estate and he found himself inheriting debt.
So he cut a deal with Parliament to surrender the hereditary revenues of the Crown Estate in exchange for Parliament paying for the Civil List and giving him a lump sum.
That is the system that has been in place ever since.
The Crown Estate is managed by an independent organisation headed by a board and all its profits go to the Treasury.
Many monarchists argue that, because of the Monarchy's historical ownership of the Crown Estate, the fact the Treasury gets all its profits should be seen as a generous act on the part of the Sovereign.
Some monarchists use this as a reason to claim that, because the Sovereign Grant is calculated as 15% of the profits of the Crown Estate, the Sovereign Grant should not be referred to as public money.
However, the argument that the profits from the Crown Estate should be seen as belonging to the Queen really only works if you are going to start asking her to pay the salaries of ambassadors and civil servants – as the Monarch did before 1760.
£8.1bn
Value of the Crown Estate
So how much does the Queen cost us?
Well, that is a very difficult question to answer.
She definitely costs us the Sovereign Grant each year, which is often divided by the number of people in the country to come up with the figure you may have heard reported like this: “The Queen costs each person in Britain 52p each year.”
However, to use this figure is to ignore the cost of security.
This cost is estimated to run into millions but we have no way of finding out because neither Scotland Yard nor the Royal Household will answer questions or Freedom of Information requests on the subject.
Republicans also argue that the Duchy of Lancaster is revenue lost to the Treasury so this should be calculated in the cost. And they also argue that Lord Lieutenants (the Queen's representatives round the country) cost us £2 million per year, and that the cost to local authorities of hosting royal visits (policing, crowd control etc) should be included in the overall figure.
PS. Don't forget Prince Charles
As the heir to the throne
Prince Charles' duties are funded separately to the Queen through the Duchy of Cornwall.
Set up in 1337 to provide the heir with an income, the Duchy is run on the same basis as the Duchy of Lancaster (read the relevant section higher up, I am not repeating it).
In the financial year ending April 2013 year Prince Charles made £19.1million from the Duchy. He pays voluntary income tax after expenses.
Again, republicans argue that this is money that would go to the Treasury if we didn't have a monarchy.
Net profits of Royal Duchies
Duchy of Cornwall
£19.1m
Duchy of Lancaster
£12.5m
So is the Monarchy value for money?
Well that is a BIG question and it largely depends on your opinion.
It is also difficult to have a clear debate about the issue when the substantial cost of security is hidden.
However, monarchists argue the value the royal family brings to Britain through their official duties far surpasses any cost.
They argue the monarchy boosts tourism and gives Britain a unique position on the world stage (the monarch is also head of the Commonwealth).
In 2012, company Brand Finance produced a report valuing the monarchy at £44 billion, citing a figure of £26.4 billion in economic benefits through the boost to tourism and other industries.
However, the report included the cost of the Crown Jewels and royal palaces in the valuation – arguably not relevant.
Monarchists argue that to replace the Monarchy with another Head of State would not save money as we would still have to protect and provide for the new figurehead.
However, Republicans dispute this and claim that, by their calculations, the British Monarchy costs more than 100 times the Irish President.
http://www.mirror.co.uk/news/uk-news/queens-finances-explained-you-need-3753404#ixzz3DtQX5lkW
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