Sovereign Grant Bill

Michael Ellis Excerpts

Thursday 14th July 2011 Commons Chamber

[Mr Jones]

I also chaired the value for money group in the Ministry of Defence, and those costs were on the radar screen for the work it was carrying out. There is a sense of grievance in the MOD and the armed forces that this money comes out of the defence budget. There should be some recognition of this vital work, but it should not come out of the defence budget. That would also avoid the nonsense that we saw last week in The Mail on Sunday, which claimed that the Prince of Wales and other members of the royal family stopped using the royal flight because the cost was being charged to the royal household. I understand that after representations were made to the Treasury the cost was reduced by £6,000 an hour for the use of one of the royal flights. Therefore, a basic subsidy is going to the royal household from the defence budget, which I do not think is right. If the full cost of the royal flight is £13,000 an hour, the Government should pay for that to support members of the royal family who need to travel on official duties. I have no problem with that, but I have a problem with where it comes from and how it is accounted for.

[Michael Ellis (Northampton North) (Con)]

Does the hon. Gentleman not accept that these military equerries and the like are on secondment from military duties? They remain military officers in the service of the Crown via the Ministry of Defence, so it is quite appropriate that they should be paid by the Ministry of Defence?

[Mr Jones]

No, I am not suggesting that somehow they should be taken out of the military while they do these duties, because there is an important link between the royal household and the military, but I do not think that they should be paid for from the defence budget while they are on these duties. In trying to get full transparency in what the royal household costs and therefore what the sovereign grant should be, we need to know about all these other costs so that we assess what is needed to support the sovereign in her work as Head of State. There needs to be transparency.

The Chancellor said earlier that the NAO could look at this, but there is nothing in the Bill that says it will look at costs in kind in relation to the Ministry of Defence and other budgets. If we are to ensure that the royal household has the money needed for the royal family to do their official duties, it is important that there is transparency and that the costs do not fall on the Ministry of Defence, for example.

Some people argue that there should be a cap every year on the sovereign grant. That is possibly a bit too blunt a mechanism. I accept what the Chancellor has said about the size of the reserve. However, if we are to ensure that the efficiencies that have taken place so far in the royal household continue, we need to consider not only how the sovereign grant, but the reserve, is spent each year. It would be quite easy to run the reserve down each year to ensure that more money is needed every year. There needs to be some scrutiny of exactly how the reserve is spent.

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I take the point made by the hon. Member for Gainsborough (Mr Leigh) about the titillation factor in looking at what the royal household spends money on. However, the core point is that this is Government—public—money. If we do not want the royal family to be denigrated but rather to gain support for them, one way would be to ensure that the sovereign grant is well spent and that people see that that is the case. We accept that some items are very expensive to undertake, such as the upkeep of royal palaces and—I have to agree with the hon. Member for Gainsborough—the way in which people have to travel for security reasons, but there must be an emphasis on ensuring that the taxpayer gets value for money. That is a way of strengthening support for the sovereign and the work that she and her family do on behalf of the nation. If we going to get this right, and the Bill is a good attempt at trying to do so, we must ensure that we not only get value for money but are very clear and honest to everybody about all moneys that are spent on supporting the sovereign in the work that she does.

[Michael Ellis]

Will the hon. Gentleman give way?

[Mr Jones]

I was about to conclude, but go on.

[Michael Ellis]

The hon. Gentleman refers to concern about value for money. Does he accept that the royal family bring in hundreds of millions of pounds to the state every year as juxtaposed with the few millions that it costs to run the royal family, most of which is spent on public buildings?

[Mr Jones]

That is another debate and it is difficult to quantify what the hon. Gentleman says is brought in. I do not just look at this in terms of money, but take the more fundamental view that we have a Head of State and should support her in the work that she does on behalf of this nation. What I am saying is that we need to be clear about what that costs. We should be honest about how much it costs, even if it costs more than £34 million, and not hide the way in which moneys are spent.

I broadly welcome the thrust of the Bill, but I hope that the NAO report looks not just at how royal expenditure is spent on the sovereign grant, but at other moneys that are paid to the royal household. It might suggest, for example, that the money that comes from the Ministry of Defence should not come out of defence expenditure.

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[Jacob Rees-Mogg]

I am very grateful to the hon. Gentleman, but I think it is immeasurably confusing when we start trying to divide the Queen up in that way. Her Majesty is our sovereign, full stop. She is one person, indivisible. She is not the trinity—Her Majesty the Queen, Her Majesty Mrs Windsor and Her Majesty the third party of the trinity. It does not work like that. She is one sovereign individual.

The next point that I want to make is one on which I agree, as I often do, actually, with the right hon. Member for North Durham. [Hon. Members: “Honourable.”] I am so sorry, the hon. Member for North Durham (Mr Jones). It is in Her Majesty’s gift, of course, to promote him, and perhaps she might have looked more favourably on that if he had been a bit more loyal in his comments. However, I agree with his point that we have to pay for the constitution that we have. The Queen is not here to bring in tourism and things like that. She is here as an essential part of our constitution. That is why it is worth the military taking on the costs of sending attachés and so on and so forth. The military owe their loyalty to the Crown, not to politicians, senior generals or people who could abuse that power to change how this country is run.

Our constitutional settlement, which works extraordinarily well and has worked well for hundreds of years, is worth paying for. On that basis, we get stability as a nation and the effective operation of our constitutional system. The judges owe loyalty to the Crown; the military owe loyalty to the Crown; we, as Members of Parliament, swear an oath to the Crown. It is the Crown that is at the pinnacle of our constitution, outside and above politics and a defender of our liberties. Indeed, as Charles I said at the scaffold, he died the martyr of the people, because he had been defending the liberties of the people, as the Queen has done now for jolly nearly 60 years. We must be willing to pay the right price for our constitutional settlement, and I think that should be a generous price.

[Michael Ellis]

Does my hon. Friend agree that the fact that each sovereign since 1760 has been asked by successive Governments to sign over the proceeds of the Crown Estate, in and of itself, proves that the estate belongs not to the country but to the person of the sovereign?

[Jacob Rees-Mogg]

My hon. Friend is of course right.

It is often said that Her Majesty is the golden thread that binds our nation together, and the key part of that phrase is the word “golden”. Her Majesty is not the cotton thread, or the silver thread, or the woollen thread, she is a golden thread that binds the nation together as one unique, great and noble nation.

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[Michael Ellis]

I am delighted to follow the hon. Member for Stoke-on-Trent Central (Tristram Hunt), who is clearly a royalist, and who is a founding member of the all-party parliamentary group on the Queen’s diamond jubilee, and I congratulate him on that.

It is easy to try to put a price on monarchy, as I think the hon. Gentleman was saying. Of course, to a certain extent, one has to do that, especially in such a debate as this, but the monarchy, personified so ably by our sovereign, is not bounded by monetary value; it is about honour, nobility of conduct, its historical nature, and an institution of which we can all be proud. If we look in some detail at the mischief that the Bill is trying to redress, the finances of the royal household, designed to support Her Majesty, are currently overly complex. There are no fewer than four grants, which are themselves hidebound and bureaucratic. They have a tendency to be inflexible in that if there is a depletion of one grant, there cannot be a transfer from the other grants to fill the gap. Consequently, the system clearly does not work. That, in and of itself, irrespective of one’s ideological views about monarchy as an institution, needs to be redressed.

However, it goes deeper than that, because the sums we are talking about—approximately £35 million—are, in governmental terms, de minimis. They are minuscule. I dare say that this area of expenditure is more scrutinised, deeply analysed and debated in various forums, including this House, than other areas of the public finances, where hundred of millions, or even billions, of pounds are spent, so there is no shortage of scrutiny whatsoever. It is clear that for the first time since the early 1970s Parliament is looking at a proper modernisation of the finances of the royal household and the monarchy.

[Thomas Docherty]

The hon. Gentleman refers to the level of scrutiny that the household finances receive, but this debate will last less than three hours. Does he not think that that is a flaw?

[Michael Ellis]

I think one can tell from the number of Members in the Chamber that the matter has been debated perfectly clearly.

The Crown Estate is the property of the sovereign and is in the right of the Crown. In the generations since George III’s accession in 1760, successive Governments have gone to the sovereign of the day and asked, “May we have the proceeds from the Crown Estate?” All sovereigns since, including George IV, William VI and so on, have signed away those rights. However, from a legal perspective, the fact that the application has been made and the request granted on each occasion perhaps indicates how the law would look at the matter. It seems clear to me that the revenue is surrendered to the Exchequer and that the legal implication of that act of surrender is that the revenue belongs to the Crown.

The sovereign grant is normally set as equal to 15% of the profit from the Crown Estate, as has already been alluded to. It could be argued that that is sufficient, but it is not over-generous, and no one could reasonably argue that it is disproportionate to the affairs of the Crown. If one takes the care to look at where Crown expenditure actually goes, one will see that much of it goes back to general public usage. For example, most of the communications allowance is spent on writing paper, stationery and clerical costs for responding to items of correspondence received by the royal household. With regard to entertainment costs, tens of thousands of British subjects receive hospitality at garden parties, for example, so costs are incurred in that way.

The royal palaces account for a huge part of royal expenditure. If we did not have a royal family, it is reasonably safe to assume that we would retain the palaces—one would hope that they would not be knocked down to build car parks—and consequently there would be museums that would need to be maintained, although no doubt few people would visit them. The roofs would still need to be fixed and leaks repaired, so the Exchequer would not save. When one takes the care to look at the expenditure, one will see that it is extremely modest and, as has been alluded to, extremely impressive savings have been made over the past couple of years.

The current system is inflexible, overly bureaucratic and has not been as transparent as it could have been. One cannot rationalise romance, and I take the point made by my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg) and others that the institution of the monarchy is about more than just money, but one must bear in mind that although the monarchy is an emotionally unifying institution and, in my view, crucial to the success of this state, it is also susceptible to proper analysis of its finances, which is what the Bill will do. Consequently, I give it my full support.