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Just how is the Royal Family funded?

The question of how to fund the British Royal Family is a perennial muse for both republicans and monarchists alike. Some advocate a larger proportion of state funding while others encourage the Monarchy to become self sufficient in its funding.

One things for certain though, regardless of how the Monarchy is funded, there will always be people who – for one reason or another – oppose the status quo. But what is the status quo? It’s well known that the funding for the Monarchy has never been straight forward, so just where does the money come from and more importantly, where does it go?

If you listen to the Republic campaign, they’ll suggest to you that The Queen is personally paid through vast state funding worth a third of a billion pounds. This is of course nonsense, though. Not only is The Queen not paid a salary, but the real figure (as in the one that actually exists) is ten times less at around £36m a year.

Before 2011, the Monarchy was funded through a complex system consisting of three main sources: the civil list (funding most of the Monarchy’s work); grants-in-aid (funding mostly travel) and parliamentary annuities (which The Queen would receive from the Treasury for funding other royals).

In 2010, it was announced that funding for the Monarchy would be rolled into one easier, more accountable system called the Sovereign Grant, and in 2011 the Sovereign Grant Act was passed. For the first time, it pegged the amount of The Queen’s funding to the Crown Estates, a property portfolio owned by the Sovereign which since George III has been surrendered to the Treasury in exchange for dependable funding each year in return.

The funding for the Monarchy now goes like this… Each year, The Queen receives an amount from the Treasury that’s equivalent to 15% of the profits of the Crown Estate ‘two financial years’ before. The key there is equivalent. The money doesn’t come directly from the Crown Estate as is widely believed, but rather from the Treasury. This distinction is important because even if the Crown Estates were to generate no profit, the Treasury still has an obligation to fund the Monarchy under the Sovereign Grant act.

For 2014-15, the Sovereign Grant worked out as £37.9 million.

This Sovereign Grant is used to fund The Queen’s activities as Monarch, including the upkeep of royal residences, paying staff salaries and performing royal engagements. In addition to this, the Duke of Edinburgh is now the only member of the Royal Family to receive a parliamentary annuity – set at £359,000.

All other members of the Royal Family’s engagements within the UK are funded by The Queen personally, from her personal income, from the Duchy of Lancaster (a privately owned estate). The Prince of Wales, meanwhile, is also funded from his own private estate (the Duchy of Cornwall) which is used to fund his domestic engagements, household and activities as well as those of his family (his wife, the Duke and Duchess of Cambridge and Prince Harry). Since 1993, The Queen and Prince of Wales have paid full income tax on their private income.

Work undertaken on behalf of the Government, such as overseas visits, are funded through special arrangements within the Sovereign Grant.

Summary
  • The Queen is given an amount from the Treasury each year equivalent to 15% of Crown Estates income.
  • The Duke of Edinburgh receives £359,000 annually from the Government.
  • Prince Charles, Camilla, the Duke and Duchess of Cambridge and Prince Harry are funded through Prince Charles’s personal income from the Duchy of Cornwall
  • The Queen personally funds all other members of the Royal Family’s activities via the Duchy of Lancaster, her personal income.
  • Overseas engagements and those done on behalf of the Government are taxpayer funded through Sovereign Grant.

photo credit: Birmingham Royal Visit 2012 via photopin (license)

  • tuha

    Its fairly cheap.

  • Ian

    I would love to know what income in the form of taxation (VAT etc) The Treasury gets from businesses that are directly linked to foreigners coming to London (specifically see B Palace and any other ‘Royal Residences’ within the M25) and spending money in restaurants, bus tours, hotels, street vendors, transport systems etc etc etc – I bet £37.9m is less than 5%

  • Michael Steven Chavez

    So the Queen gives up ALL of the income from the Crown Estates and in return gets back 15%? Seems to me she’s funding a lot more than herself, since 85% of her income goes into government coffers. All those who complain about the cost of the monarchy to taxpayers should shut up unless they’re paying at least 85% of THEIR income into the Exchequer.

  • Dorrie M Galea

    It is not much considering. The way certain quarters gripe and whine one would think the cost is much, much more.

  • DPJ

    As an American, and supporter of HM, I find it absolutely funny that some would want the Crown to not receive any support from the taxpayers. From what I’ve calculated, the cost to each citizen of Britain is less than $1 USD per person per year. That’s nothing! Here in the good ‘ol USA, the cost per person is more than $2 USD per person per year AND not very many foreigners come to America to see the current President or things related to that office. Meanwhile, millions travel to Britain each year to catch a glimpse of HM and to visit the many historical places all over England. So, that measly $1 per year probably receives multiple in return; yet how much public support to the so-call “poor” receive from the taxpayers and what to do they provide in return?

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