Sovereign Grant Bill

Richard Fuller Excerpts

2nd reading
Monday 14th September 2026 Commons Chamber

[Richard Fuller (North Bedfordshire) (Con)]

I thank the Minister for his speech. This follows a recent debate on ways and means that his colleague the Exchequer Secretary had with my hon. Friend the Member for North West Norfolk (James Wild). I do not wish to repeat the points that were made on that occasion.

His Majesty’s official Opposition are supportive of this Bill. As the Minister laid out, the 2011 settlement has run its course; it did well for its time, but some aspects of it were due for reconsideration. As he said, the recent significant programme of upgrades to royal residences for public purposes has now reached its conclusion—I think this year is the final year of the additional funds—so it is timely for us to look for a change in structure. I thank the Minister’s colleague the Exchequer Secretary, because on the 11th of this month, he wrote in reply to questions from my colleague, answering questions about some of the points that we may get into in detailed consideration of the Bill.

One of the substantial changes of principle in this Bill is that the ongoing ratchets that were effectively put in place by the 2011 Act have essentially become a backstop of £99.9 million. In his answer to my right hon. Friend the Member for South West Wiltshire (Dr Murrison) about potential variability, the Minister has given us some confidence about the ability to plan; we know that there will not be an absolute reduction. However, questions remain about extraordinary circumstances in which the Treasury would be able to reduce the settlement in any one year. I think that the Liberal Democrats will be asking that question in reverse—about changes to the percentage that may occur—but those are matters that we can discuss in Committee.

His Majesty’s official Opposition recognise the tremendous work that His Majesty the King and the royal family do on behalf of our nation. We understand the power that that provides our nation with in our international relations, and the comfort that it gives to the people of this nation, and we support the Second Reading of this Bill.

Sovereign Grant Bill

Richard Fuller Excerpts

Committee of the whole House & 3rd reading
Monday 14th September 2026 Commons Chamber

[Madam Deputy Speaker (Caroline Nokes)]

I call the shadow Minister.

[Richard Fuller (North Bedfordshire) (Con)]

I thank the Minister for his clear exposition of the Bill’s clauses. He emphasised the importance of the 2026 royal trustees’ review. The interesting thing is that it is their forecast of their needs over the next five years on which a lot of the mechanism rests. Notwithstanding some comments made by Government Back Benchers, a lot of the intention of the Bill is about financial restrictions on expenditure, rather than there being excess expenditure in the future. I am grateful for the Minister’s letter to my hon. Friend the Member for Dumfries and Galloway (John Cooper); in his summing up, will the Minister give a bit more comfort and clarity on some of those matters?

If I am right, the £99.9 million is the estimate of what is required this year, based on a review of what the forecast requirements may be through to 2031-32. Will the Minister explain how those financial assessments were made? What discount rate was used to work out what the estimates might be? I am not questioning it, and I do not need a precise figure; what I am looking for is some comfort from the Minister that he feels that those financial projections, that model and the work of the trustees give him adequate confidence in the baseline of £99.9 million. That leads, in turn, to why we have 20.5% variability over the next five years.

In the Minister’s response to my hon. Friend the Member for Dumfries and Galloway, I was also interested to hear about the use of other income. In his letter, the Minister said:

“The Household forecasts that this income will increase by around 25% over the review period, based on recent performance, detailed modelling and increased visitor capacity… If income were lower than forecast, there is no expectation that the Grant would increase above £99.9 million per year.”

Can the Minister confirm that, essentially, the other income is being treated as supplementary to what we see as the duty of the sovereign grant? I would be grateful to the Minister for reconfirming what he put in his letter.

In clause 3, I am interested in proposed new section 6(5) to the Sovereign Grant Act 2011, stating that the reserve fund will be:

“no lower than 10% and no higher than 50%”.

What is of interest there is the duty to change the amount of the sovereign grant. There is an issue about to what extent that reserve, at 10% to 50%, is going to cover reasonable expectations of expense. That gets to the point that my hon. Friend the Member for Dumfries and Galloway made earlier about long-term plans. If significant capital expenditures are due, then the reserve, by its very nature, will be quite variable during the period. I would like some comfort from the Minister that the range of 10% to 50%—which sounds, on face value, to be reasonable—was correct in the modelling.

There is just one slight concern about the Treasury’s thinking on this. When my hon. Friend the Member for North West Norfolk (James Wild) asked about powers to adjust the grant between reviews and the circumstances in which they might be used, the answer from the Treasury was:

“These powers are intended for exceptional circumstances and are not expected to be used routinely”,

which, of course, is the definition of exceptional. However, the letter does then go on to talk about major fire, flood and so on, saying that in those circumstances,

“Any adjustment would require Parliamentary approval through secondary legislation.”

Could the Minister advise on whether or not that approval will be subject to the affirmative procedure? I think that other Members may want to raise that as well.

[The Second Deputy Chairman of Ways and Means (Caroline Nokes)]

I call the Liberal Democrat spokesperson.

--- Later in debate ---

[Richard Fuller]

I thank the Minister for presenting the Bill, but most importantly I thank His Majesty the King for his gracious service, on behalf of all Members of this House and all people of this country and the territories and nations overseas. I hope that he will use the sovereign grant as wisely and sagaciously as his governance over us allows. I support the Bill.