This week, the annual royal finances reports were released by Buckingham Palace and Clarence House. While the Palace report showed how the Royal Household had spent its £35.7m in public funding over the past year (from the Sovereign Grant), Prince Charles’s report demonstrated a rather curious state of affairs which means that – far from receiving a net amount in public funding, he himself is in fact a net contributor to the Treasury.
The Prince of Wales funds his official duties through the surpluses he receives from the Duchy of Cornwall, a private estate held by the Prince as heir to the throne (and therefore Duke of Cornwall).
Aside from small amounts claimed in public expenditure from the Treasury for overseas visits and those conducted on behalf of Government departments, the Prince does not receive full public funding like Her Majesty and the Duke of Edinburgh do.
In fact, the Prince of Wales’s annual report shows that the Prince received exactly £2.234m in public funding in the last financial year, of which just over £1.7m came from the Sovereign Grant, which the Prince uses to fund official travel and property maintenance (the maintenance of residences which are, anyway, publicly owned).
The Prince also received just under £500,000 from various Government departments, for example the Foreign and Commonwealth Office, which fund certain engagements undertaken overseas by the Prince, on behalf of the Government.
Last year, the Duchy of Cornwall had surpluses of £19.85m – the majority of which are used to fund the Prince’s official duties, as aforementioned.
Since the 1990s, both The Queen and Prince of Wales have volunteered to pay tax, despite enjoying a legal exemption. Prince Charles, officials say, pays tax at the normal rates – including the 45% top-rate of tax applying to income over £150,000 in the UK and capital gains tax, “like any private individual”.
Indeed, according to the official report, the Prince contributed £5.1m in taxation to the Treasury in the past year, compared to the £2.234m that was received in public funding for the Prince, making Prince Charles a net contributor to the Treasury by some way; a situation which has continued to be the case year after year.
This means that, last year alone, Prince Charles contributed a net total of £2.866m to HM Treasury.
When the Prince of Wales accedes as King, he will lose the revenues of the Duchy of Cornwall – which will pass by right to the Duke of Cambridge (who’ll immediately become Duke of Cornwall).
Prince Charles will then have the option of continuing with the current Sovereign Grant arrangements where the Sovereign is paid the equivalent of 15% of the Crown Estates’ surpluses to fund their official expenditure, or to take back the Crown Estates for the Sovereign – a move which is not anticipated and would be unprecedented in recent times.
Of course, it goes without saying that no member of the Royal Family receives a salary for their work.
While The Queen and Duke of Edinburgh are entitled to public funding regularly from the Sovereign Grant, The Queen personally funds other members of the Royal Family’s duties through her own Duchy of Lancaster, a private estate which – similarly to the Duchy of Cornwall for the Prince of Wales – provides the Monarch with a personal, private income. This is also used to meet The Queen’s personal expenditure, not created in her capacity as Head of State.
The Sovereign Grant report showed that, in the last financial year, the Royal Household spent £35.7m – leaving a surplus of cash which they didn’t use, but were entitled to. This now goes into a reserve fund.
photo credit: Glenn Euloth