Duchy of Cornwall Bill [HL]

Lord Marks of Henley-on-Thames Excerpts

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

[Lord Marks of Henley-on-Thames (LD)]

My Lords, I thank the noble Lord, Lord Berkeley, for introducing the Bill and for the comprehensive way in which he opened the debate. We welcome the Bill. As the noble Lord, Lord Wakeham, and the noble Lord, Lord Adonis, suggested, I do not suppose that the noble Lord, Lord Berkeley, expects his Bill to sail on to the statute book, but that does not stop us discussing its principles in a Second Reading debate on a Private Member’s Bill.

I handled for my party the Succession to the Crown Act 2013, which provided principally that succession to the Crown should not depend on gender, as well as removing the unjustified and discriminatory disqualification from the succession by marriage to a Roman Catholic, a disqualification that dated from the late 17th century and the conflict about the departure from the Throne of James II and the accession of William and Mary. The Succession to the Crown Act was passed by the legislatures of all the Queen’s realms in a complicated exercise of diplomatic co-ordination when the Duchess of Cambridge was expecting a child. It was passed in time for the newborn, whichever gender it happened to be, to take a confirmed place in the line of succession and not be liable to future demotion if the child was a girl. As it happened, he was a boy, and Prince George duly became third in line to the Throne, but the Act has had the effect that Princess Charlotte comes next, notwithstanding the birth of a younger brother, and that is as it should be.

Clause 1 of the Bill of the noble Lord, Lord Berkeley, replicates that Act in its removal of gender preference for the title of the Duke of Cornwall. The present rule, embodied in the 1377 charter, is an arbitrary and discriminatory preference, which is a hangover from the 14th century, and it is high time for its removal.

One might say the same about the rest of the hereditary peerage—that daughters should inherit on the same footing as sons—and that the present arrangements in most letters patent are also discriminatory and quite unacceptable in a contemporary context. The noble Lord, Lord Lucas, certainly takes that view and introduced a Bill to reform the system in the 2012-13 Session, although the Bill never proceeded. I, and no doubt many others, can see why the Government may not see this kind of reform as meriting a high place on their legislative agenda, because it affects only a limited number of families and usually highly privileged ones at that. But the question does arise as to how far and for how long we should tolerate this kind of blatantly unfair discrimination, in spite of its limited application. The noble Lord, Lord Berkeley, is quite right to challenge it in this Bill in the context of the Duchy of Cornwall.

Clause 2 would remove Crown immunity from suit for the Duchy of Cornwall and we agree that there is no reason for Crown immunity to extend to the Duchy. The only proper purpose of Crown immunity is to give immunity from suit to the sovereign and to organs of government in certain tightly defined circumstances which Parliament has sanctioned, as set out in the Crown Proceedings Act 1947. As the noble Lord said, the Duchy is effectively a body in the private sector and there is no earthly reason why Crown immunity from suit should extend to the Duchy of Cornwall.

Again, Clause 3 would remove the anomalous exemption from tax for the Duchy, which was the subject of much of the speech of the noble Lord, Lord Adonis. Under the present arrangements, tax for the Prince of Wales is an entirely voluntary matter, as is tax for the Duchy estate, and the estate is immune from income tax, corporation tax and CGT. The Prince of Wales does not pay voluntary tax on any increase in asset values as the Duchy is a royal body and the Duchy is the owner of the assets. I do not regard that as a desirable or defensible state of affairs. Many would say that the right to the very substantial income of the Duchy is good fortune enough without its being compounded by the Prince’s only paying tax on an entirely voluntary basis. The income of the Duchy is now well in excess of £20 million a year. The Prince pays voluntary income tax of about £4.9 million, but only on his income after meeting the expenditure on royal duties, and no CGT, as I said. Those are substantial sums, and substantial sums of tax forgone are involved.

If the Duchy’s income is to go to maintain the Prince of Wales and his household, then so be it. But why there should also be a tax break for the heir to the Throne, I entirely fail to see. The Royal Family has done great things to pull itself into the 21st century. Not being required to pay tax on income in the same way as other citizens do is likely to feed controversy and questioning and bring the institution into disrepute. Nor is there any reason why the Duchy should be immune from claims by its leaseholders under the Leasehold Reform Act when they want to secure the freeholds or long leases on their homes—a reform that has been broadly welcomed and has worked well over many years for private landlords..

Closer to home for me, Clause 7 would remove access from the Duchy to the Treasury Solicitor. I see no reason why the Duchy should have access to the publicly funded legal services of the Treasury Solicitor— effectively, the Government’s legal department. We have had enough trouble with legal aid cuts for the vulnerable. Why we should be providing extensive legal aid to the Duchy of Cornwall escapes me.

For the monarchy to thrive, it needs to be contemporary, understood and trusted by the public. Maintaining discriminatory rules of succession, unfair immunities from tax, an out-of-date exemption from the Leasehold Reform Act and publicly funded legal services for the heir to the Throne is not a great way forward, and we need to start changing the rules.