Asked by: Lord Foulkes of Cumnock (Labour - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what plans they have, if any, to introduce legislation to levy inheritance tax on the estate of the Monarch.
Answered by Lord Livermore
Inheritance tax is paid in the normal way on the gifts and bequests from any member of the royal family, with the exception of the Monarch because the relevant enactments do not apply to the Crown.
The King has instead agreed that inheritance tax will be paid voluntarily on any gifts and bequests he makes, with an exception for assets passing to the next Monarch. The Memorandum of Understanding (MoU) on Royal Taxation, first agreed in 1993 and most recently renewed in 2023, sets out the rationale for not charging inheritance tax in relation to assets that pass to the next Monarch.
Asked by: Lord Foulkes of Cumnock (Labour - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what assessment they have made of the merit of replacing the Sovereign Grant by a Royal Duties Grant similar to the former Civil List which would be considered and approved by Parliament annually.
Answered by Lord Livermore
The rules governing the Sovereign Grant are set out in the Sovereign Grant Act 2011. This Act requires a review following every five-year period to ensure the percentage of Crown Estate profits used in the calculation of the Grant remains appropriate.
The most recent Sovereign Grant Review was published on 26 June this year. The Royal Trustees concluded that a reference rate of 20.5 per cent is appropriate for the funding formula from 2027-28 onwards, which equates to a 2027-28 Grant amount of £99.9 million, a reduction against the £137.9 million in 2026-27.
The Government is committed to bringing forward legislation to enable the Grant to be reset to that lower level from 2027-28 and will bring forward the Sovereign Grant Bill when parliamentary time allows. This Bill will also introduce a mechanism so that in future years, the Grant can be reduced from one year to the next, preventing inappropriately high funding without the need for further primary legislation. This legislation will enable further parliamentary debate to occur.
Asked by: Lord Foulkes of Cumnock (Labour - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what mechanisms will be introduced in the Sovereign Grant Review to prevent overlap of funding between the Sovereign Grant and the Foreign, Commonwealth and Development Office in respect of (1) inbound state visits to the UK, (2) outbound visits by members of the Royal Family, and (3) the monarch’s costs as Head of the Commonwealth.
Answered by Lord Livermore
Expenditure met from the Sovereign Grant and that met by the Foreign, Commonwealth and Development Office (FCDO) budgets serve distinct purposes.
The Sovereign Grant provides funding to support the official duties of working Members of the Royal Family, including staff, overseas travel to conduct and prepare for outward State Visits and the maintenance of the Occupied Royal Palaces. The FCDO and other departments meet separate costs associated with the UK’s diplomatic activity, both in the UK and overseas.
The FCDO funds in-country arrangements for outward State Visits, including accommodation and wider hosting arrangements. For inward State Visits, the FCDO funds the accommodation of the visiting delegation, as well as gifts and certain ceremonial activity, such as the State Banquet.
For activity undertaken in respect of His Majesty’s role as Head of the Commonwealth, the Sovereign Grant, FCDO and other departments fund respective activities that support the UK’s diplomatic objectives. Costs associated exclusively with The King’s role as Head of the Commonwealth may be met by the host country or participating Commonwealth member states. As with inward and outward visits, there remains a clear distinction between funding provided by the Sovereign Grant, and the funding provided by the FCDO and other departments for Commonwealth-related activity.
Asked by: Lord Foulkes of Cumnock (Labour - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government further to the Written Answers by Lord Livermore on 30 March (HL15749 and HL15750), on what date they expect to receive the report of the Royal Trustees on the 2026 review of the Sovereign Grant; when they intend to lay that report before Parliament; and when they intend to introduce the Sovereign Grant Bill announced in the King’s Speech.
Answered by Lord Livermore
As required by the Sovereign Grant Act 2011, the next review of the Sovereign Grant is taking place this year. Further detail will be announced in due course.
The Government is committed to bringing forward legislation to reset the Grant to a lower level from 2027-28 once Buckingham Palace reservicing works are completed. The Government will bring forward the Sovereign Grant Bill when parliamentary time allows.
Asked by: Lord Foulkes of Cumnock (Labour - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government whether they intend to direct the Financial Conduct Authority to introduce a financial threshold above which the Financial Ombudsman Service is required to investigate a reasonable complaint without recourse to non-specific or procedural grounds for dismissal, particularly in cases where alleged fraud exceeds £1 million.
Answered by Lord Livermore
The Government cannot direct the Financial Conduct Authority (FCA) regarding the content of its rules.
The Financial Ombudsman Service (FOS) plays an important role in providing quick and informal resolution of complaints between financial services providers and their customers, as an alternative to resolution through the courts. However, the Government recognises that there are some cases where it is appropriate for the FOS to dismiss complaints without consideration of the merits – for example, where it would be more suitable for the complaint to be dealt with by a court or another alternative dispute resolution body.
The FOS and the FCA recently consulted on changes to the rules setting out the grounds for dismissal of complaints, and are considering the responses received.
In relation to complex fraud cases, the consultation notes that these will often be the subject of a criminal investigation, where the relevant authorities have greater legal powers to carry out certain investigations and whose findings may have a direct bearing on any determination made by the FOS. If the FOS were to make a decision before such proceedings conclude, this could result in outcomes that are not fair and reasonable, or could potentially prejudice future legal proceedings.
Asked by: Lord Foulkes of Cumnock (Labour - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government how many complaints referred to the Financial Ombudsman Service in the past 12 months were dismissed without consideration of their merits under the provisions of DISP 3.3.4A(5) of the Financial Conduct Authority Handbook, on the grounds that considering the complaint would “seriously impair the effective operation of the Financial Ombudsman Service”.
Answered by Lord Livermore
This is a matter for the Financial Ombudsman Service (FOS), which is an independent, non-governmental body.
The FOS will respond to the Noble Lord by letter, and a copy of the letter will be placed in the Library of the House of Lords.
Asked by: Lord Foulkes of Cumnock (Labour - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government, in regard to section 7 of the Sovereign Grant Act 2011, on what date they expect to receive the report of the Royal Trustees on the 2026 review of the Sovereign Grant; and on what date they expect that report to be laid before Parliament.
Answered by Lord Livermore
As required by the Sovereign Grant Act 2011, the next review of the Sovereign Grant is taking place this year. Further detail will be announced in due course.
The Government is committed to bringing forward legislation to reset the Grant to a lower level from 2027-28 once Buckingham Palace reservicing works are completed.
Asked by: Lord Foulkes of Cumnock (Labour - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government whether they plan to introduce legislation to adjust and reduce the Sovereign Grant in the next King's Speech.
Answered by Lord Livermore
As required by the Sovereign Grant Act 2011, the next review of the Sovereign Grant is taking place this year. Further detail will be announced in due course.
The Government is committed to bringing forward legislation to reset the Grant to a lower level from 2027-28 once Buckingham Palace reservicing works are completed.
Asked by: Lord Foulkes of Cumnock (Labour - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government, further to the Written Answer by Lord Livermore on 26 February 2025 (HL5095), what arrangements they are making for the review of the Sovereign Grant this year; and when they plan to bring forward the legislation to implement the reduction of the Sovereign Grant from financial year 2027-28.
Answered by Lord Livermore
As required by the Sovereign Grant Act 2011, the next review of the Sovereign Grant will take place this year. In addition, the Government has committed to bring forward legislation to reset the Grant to a lower level from 2027-28 once Buckingham Palace reservicing works are completed.
Asked by: Lord Foulkes of Cumnock (Labour - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government when the terms of reference for the next review of the Sovereign Grant in April 2026 will be prepared; who will be responsible for preparing them; and what input will be invited from parliamentarians.
Answered by Lord Livermore
The requirements for the 2026 review of the Sovereign Grant have been set by Parliament in the Sovereign Grant Act 2011. This requires the Royal Trustees to consider what percentage of Crown Estate profits should be used in the calculation of the Sovereign Grant for the period from 2027, once Buckingham Palace reservicing works are completed. The Act requires that the Royal Trustees report is laid in Parliament, and any change in the percentage used given effect by Statutory Instrument agreed by the House of Commons. In addition, the government has committed to bring forward legislation to reset the Grant to a lower level from 2027-28, which will enable further parliamentary debate on this issue.