Duchy of Cornwall Bill [HL]

Lord Berkeley Excerpts

2nd reading (Hansard): House of Lords
Friday 26th October 2018 Lords Chamber

Moved by

[Lord Berkeley]

That the Bill be now read a second time.

[Lord Berkeley (Lab)]

My Lords, I declare an interest: I live with my wife in the Isles of Scilly; she has lived there for over 40 years. I have been following royal transport costs for many years and make no secret of my opinion that some of the Royal Family’s transport costs have been justified and are seen to be frugal, but some are excessive, including a charter flight to Saudi Arabia for a funeral.

The point of the Duchy of Cornwall is clearly to provide an income for the heir to the throne. We can dispute how much is needed and whether the confused and non-transparent operation of the Duchy is justified to achieve this. As the Duchy has been telling us for many years, it is a private estate and private estates often provide income for their owners in a transparent and non-discriminatory manner. I note that this Bill requires the consent of both the Queen and the Duke of Cornwall. I question why the Duke of Cornwall: is there not a conflict of interest? I do not think we will get that far, but it is an interesting question to debate.

I think this is the fourth time I have put down this or a similar Bill. This is simpler than previous ones and seeks to concentrate on what I think are the most important issues to be addressed. I argue that because the Duchy now firmly says that it is in the private sector, it should be treated as such. I am also very grateful to Dr John Kirkhope, an eminent scholar and notary public who has spent years examining the Duchy issues and helped with the Bill and what I am going to say.

The trouble is, the Duchy sometimes chooses to be treated as a private estate and sometimes as a Crown body, which receives privileges and is largely unaccountable and silent on many issues. It is wrong that the Duchy should be able to choose its own status based on what is apparently the most financially advantageous option. It should be one or the other—and it has chosen the private option. My Bill is designed to put that option into effect, making it a private estate with no special privileges. I emphasise that the Bill is not about the Duke of Cornwall per se, apart from the first clause. I should also tell the House that a year or two ago, when I previously put forward a Bill, I had a meeting with Duchy officials. We went through all the clauses in that Bill, which was very similar to the Bill today, and, at the end, I asked if they agreed with what I had said and they replied “Yes, largely”. Then when I asked if they would say so in public they said, “No”. I wrote to them again before today asking if they would like to discuss this Bill and I did not get a reply. So there we are. We ought to compare what the Duchy of Cornwall does with what the Duchy of Lancaster and the Crown estates do, which are much more transparent and open.

Clause 1 is on the succession to the title “Duke of Cornwall”. We have debated this in the past and I could go on about it for a long time. The key thing is that it should be open to women as well as men; I am not quite sure whether they would be called the Duchess of Cornwall, but it does not matter that much. The point is that they should have the same privileges and rights as the Duke of Cornwall. After all, the Duke of Lancaster is always the sovereign, regardless of gender, so why should that not apply to the Duke of Cornwall? We can debate that, and I am sure that when the Minister replies he will go back to the royal charter of 1842, although it probably goes back to long before that. But I will not get into that now, because there are many important things that I need to put to the House.

Probably the most important issue is Crown immunity, which is addressed in Clause 2. To illustrate the lack of transparency, a friend of mine who has been trying to buy his house in the Isles of Scilly under the right to buy, and other colleagues, put in 64 freedom of information requests about the Duchy and the Crown immunity issue. I will give only one example. In August 2011, they asked the Ministry of Justice:

“Please provide any papers which explain the basis on which the Duchy of Cornwall enjoys Crown Immunity”.


At least the ministry answered it, but its answer was: “We do not hold any material which you request”. So how can they do it?

There are other examples in various Acts of Parliament which need to be considered. One is the Marine and Coastal Access Act 2009. It states that the provisions of the relevant part of the Act “bind the Crown”, which includes the Duchy of Cornwall, and that:

“No contravention by the Crown of any provision of this Part is to make the Crown criminally liable”.


The Data Protection Act gives the same information, and Section 14 of the Nuclear Explosions (Prohibition and Inspections) Act 1998, the Transport Act 2000, the Licensing Act 2003, the Planning and Compulsory Purchase Act 2004—I have nearly finished—and the Planning Act 2008 all contain the same exemptions.

Most people would find it odd that if the Duchy of Cornwall caused a nuclear explosion—which is highly unlikely—it would not be subject to criminal sanctions. Surely, it is a pretty remarkable state of affairs that an estate that asserts it is private is given exemptions from criminal sanctions under numerous Acts of Parliament, should it act in breach. I can go on about Crown immunity but I will not, because I would like to move on to tax.

We have debated in your Lordships’ House many times the issue of tax and the Duchy of Cornwall. The Duchy pays tax on a voluntary basis, but no other estate that I know of in this country does so. I do not know how many other noble Lords pay tax voluntarily—we would probably all like to—but the fact remains that the Duchy should be assessed and treated in the same way as any other estate or private individual.

Clause 4 addresses exemptions under the Leasehold Reform Act. As noble Lords will know, there is a consultation out on this at the moment. I have a friend who has been trying for many years to buy a property in St Mary’s on the Isles of Scilly, and he has completely failed. He has responded to the consultation and I hope he will be successful. This goes back to the issue that the Duchy of Cornwall is not bound by the Leasehold Reform Act because it has an exemption. You can understand the need for an exemption for London’s Royal Parks and other national parks and buildings, but some not very special houses on the Isles of Scilly—I am sure my friend would agree with that assessment—have this exemption and my friend is not allowed to buy his house. Whatever we think of the Leasehold Reform Act, the fact remains that everybody should be treated the same, but in this case they are not.

I think the Duchy will like Clause 5, as it would enable it to purchase land in the UK outside England. Why is there a restriction? I am told that it is a hangover from Victorian times, because of very different land and inheritance laws in Scotland at the time. Apparently, Balmoral was purchased in the name of Prince Albert because, despite the fact that Victoria was Queen, as a female she could not own land in Scotland. I am sure that many noble Lords will know more about this than I do, but that is what I am told. After the death of Prince Albert, the Crown Private Estates Act 1873 was passed to rectify the situation.

Clause 6, on the Stannaries Act, is a bit of a Cornish situation; not many people know about Cornwall’s stannaries. It is time to remove this Act because under it, the Duchy can appoint anyone to be a Duchy solicitor or barrister; they do not have to be legally qualified. That seems unnecessary. The Law Commission recommended that this provision be repealed, and I am told that the Crown lawyers, Farrer & Co, objected. They would, wouldn’t they? They would probably lose revenue if the cases ever came forward. That is another classic conflict of interest, but it is time to move that one on. The same applies to the Solicitors Act 1974.

The issue of the Treasury Solicitor is a serious one. The Duchy is a private estate. Which other private estate gets free legal advice of unlimited quantity—and, presumably, quite good quality—from the Government’s lawyers? I know several people who have had disputes with the Duchy. There was a case concerning the Helford river, which I think we have discussed before. A friend of mine won his case against the Duchy, probably because the Duchy’s representative said, “We believe we are above the law”, or something like that; but of course, when the Treasury Solicitor got involved he lost on appeal, which is no great surprise.

[Lord Adonis (Lab)]

My noble friend referred earlier to the tax position of the Duchy of Cornwall and the fact that it pays tax on a voluntary basis. My understanding is that the revenue surplus of the Duchy of Cornwall has increased by 50% in the last seven years and that its property asset base has increased from £630 million in 2011 to £940 million in 2018, which is a huge increase. Does my noble friend have the figures for what the increase in the voluntary tax paid by the Duchy of Cornwall has been in that seven years? I cannot find them. Has there been a 50% increase in the tax paid by the Duchy of Cornwall to the Treasury over that period? If my noble friend does not have the figures, it may be that the Minister, who is in full command of all the figures to do with the Duchy of Cornwall, could tell us.

[Lord Berkeley]

I am most grateful to my noble friend for that question. He will not be surprised that I do not have the answer to it. Of course, we are not talking only about income tax—it is about capital gains tax and everything else as well. We can do an FoI on it, but I suspect that it will take a long time, and that is part of the lack of transparency. I very much doubt that similar estates are subject to the same exemptions, so it is a very good question.

I think it is time that the apparent right to Crown immunity for this private estate, with the privileges that it seems to enjoy without any clear basis, came to an end, and my noble friend’s question is very germane to that. The Duchy asserts, as it is entitled to do, that it is a private estate, yet to avoid a suite of laws and because it would not be seemly for the Duchy to be seen in court, it has been granted taxation privileges and property rights and—a procedure that continues today, I think to the detriment of other taxpayers and also to some of the residents—has no parliamentary approval or judicial oversight. It is also free from criminal sanctions should it break the law—something that I think is just crazy.

Let us be quite clear: this is not the Duke but the Duchy of Cornwall. The Duke of Cornwall is completely different. Various Acts of Parliament relating to tax and many other matters in relation to this private estate have been “suspended”, as it has been called. I recall that the last time I managed to question the Chief Whip, he kindly said—I think it was before the Third Reading of a Bill—that the Queen and the Duke of Cornwall had kindly put their interests at the disposal of Parliament. When I asked why, it took about six weeks to get an answer. That was not the Chief Whip’s fault; the answer probably came from the palace, but it was completely meaningless. Therefore, we really need to bring all this into the 20th century and put the situation on to a clear and transparent footing.

Noble Lords ask me: what next? That is a fair question because I am sure that this Bill will not find its way on to the statute book in this Parliament. However, the Duke of Cornwall could decide to do much of what it seeks to do on a voluntary basis. I hope that he will read today’s debate and perhaps consider what he and his successors can do in the short term to put this matter on to a more transparent footing. I beg to move.

--- Later in debate ---

[Lord Berkeley]

My Lords, I am grateful to all noble Lords who spoke. We have had a fascinating debate. I am not surprised by the comments from the Minister—or the noble Lord, Lord Wakeham, for that matter—which I would have expected.

However, this demonstrates the confusion over what is part of government and the monarchy and what is part of private ownership and businesses. The Duchy frequently says that it is in the private sector. In his response, the Minister said that if there is not a Duke of Cornwall, the Duchy reverts to the Crown, with which I agree; it therefore presumably becomes public. How can you have a body or estate that changes between public and private depending on whether there is a male Duke of Cornwall? That seems to need looking at in a bit more detail.

The same principle applies to the property of Buckingham Palace and the discussion started by my noble friend Lord Adonis about its cost. Which bits of Buckingham Palace are Crown property because it is part of our constitution and which bits of it, including all the pictures and the ornaments, belong to the Queen personally? If she were not Queen, would she still have them? I do not know, but it seems that this obfuscation could go on for another 20 years if we are not careful.

The noble Lord, Lord Wakeham, asked why the Bill is a Private Member’s Bill. My noble friend Lady Hayter responded to that, but I would say that it is because it has been a good forum for debate. If we are going to talk about the monarchy as a whole, we could include Prayers; the Minister mentioned that we pray for Prince Charles. We could have a discussion about whether we should get rid of the link between the Church and the state, but the Minister started that one and I will leave it there.

I am also grateful to noble Lords for commenting on the Leasehold Reform Act. I do not accept what the Minister said, because it is nothing to do with a private estate, but we will follow up on that in other areas. I share other noble Lords’ views that we may not get this on to the statute book in this Parliament, but the debate has been very good anyway and I thank everyone for it.

Bill read a second time and committed to a Committee of the Whole House.