Royal Legacy: How the royal family have made, spent and passed on their wealth

by McClure, David

  The first striking feature is its date - 8 February 1939 - more than two decades before her death. It must have been written with the possibility of war and an early death at the forefront of her mind since one of the first clauses names two guardians for her children (Mountbatten's mother, the Dowager Marchioness of Milford Haven and the Earl of Brecknock) in the event of both her and her husband dying. At the time, Lord Louis was a captain in the Royal Navy in command of a flotilla of destroyers and within a year, he would narrowly escape death when his boat HMS Kelly was struck by a German torpedo (an incident that would be immortalized in the film “In Which We Serve” co-directed by his friend Noel Coward). It was only after the outbreak of the war, according to Edwina's biographer, that she told him of her intention to leave him her landed estate - which would suggest that he had not seen the will at the time it was drawn up and signed.

  Mountbatten later moaned that he received relatively little in his wife's will. In a letter to his actor friend Douglas Fairbanks Jr, he calculated that he would be left with just one shilling in the pound of Edwina’s fortune after the deduction of death duties at 80% and the division of assets among other family members.17

  It is true that there was a large tax bill to pay (and perhaps Edwina who became increasingly left-wing as she grew older did not mind sharing her wealth with the state) but on closer reading of the will, it appears that he did not do too badly out of her estate - particularly when it came to landed property. In a codicil written on 26 August 1939 to take into account the death of her father, Baron Mount Temple, seven weeks earlier, she left her husband a life interest in the family's country estate - Broadlands near Romsey in Hampshire. Should he die it would pass to their eldest daughter Patricia and then to the younger one, Pamela. Edwina also left him free of tax all her valuable personal possessions in the household.

  The bulk of the non-landed estate involved a trust fund established by Edwina's grandfather. In the main body of the will she left her husband an one third share of the income from the fund with equal shares going to her surviving children. But in the codicil dated 26 August 1939 she changed how the fund should be divided amongst her two daughters. The residue should be split into eight portions of the fund, with five equal shares going to Patricia and three to Pamela. Presumably the extra weighting for Patricia was designed to recognize the fact that as the elder sibling with no male heir she would ultimately inherit the Mountbatten title and with it the landed estate and its accompanying overheads.

  The amount of money in the family trust fund was monumental since it was the legacy of Sir Ernest Cassel, the wealthy banker who bailed out the finances of Edwina's godfather's Edward VII at the turn of the century and went on to amass a fortune greater than any possessed by a British royal. Like an Edwardian Warren Buffet, he had the golden touch when it came to picking the right investment at the right time. When he died in September 1921, he left behind such a huge estate that its original valuation had to be revised upwards. The official record at the Principal Registry states in type - probate London 7 October…effects £6,000,000 - and then in long hand is added - resworn £7,333,411. If any additional proof were needed this confirmed what many already suspected that he was one of the wealthiest men in Europe.

  We know who inherited his assets because his will - like his granddaughter's - was never sealed. He left a life interest on his valuable London residence - Brook House on the corner of Park Lane and Upper Brook Street - to his sister Wilhelmine which on her death would pass to Edwina.18 Edwina also received the lion's share of the residuary estate which was split into sixty-four parts. She inherited 25/64ths, her sister Mary 16/64ths and her aunt Anna 8/64ths. In cash terms, her portion was worth £2,900,000 earning her the soubriquet “the richest girl in Britain.”

  Edwina Ashley was Sir Ernest's favourite granddaughter. When his only daughter, Maud, died early he transferred his affection (and wealth) to her beautiful elder daughter. This, though, did not prevent him from attaching strings to Edwina’s inheritance. As a successful financier who knew the value of having a diversified portfolio, he insisted that no single investment in the trust fund should exceed £100,000. Edwina would have to wait until her 21st birthday before some of the money came on stream and her 28th (or if earlier, her marriage) for the rest.

  In fact, she got married to Lord Louis not long after her 21st birthday on 18 July 1922 in an opulent ceremony at St Margaret’s, Westminster where the Prince of Wales was the best man and King George V and the cream of European royalty made up the congregation. Although they had been friends for almost two years, their relationship had recently been cemented by shared grief – within the space of a month, Louis lost his father and Edwina her grandfather. Not long after the wedding, the groom discovered more restrictions on the bride’s trust fund. Under statute, she was denied access not only to some of the capital, but also to its accrued interest. Never one to be put off by an insurmountable legal obstacle, Lord Louis set about lobbying parliament to change the law. A draft bill amending the legislation on trusts failed at an early stage in the Commons, but a second bill did eventually get the royal assent enabling the Mountbattens to get closer to their money. Lord Louis later admitted to his daughter Pamela that in the immediate pre-war years he and Edwina had difficulty spending their annual income of £60,000 which in today's money amounted to over £5 million a year.19

  She splashed out on a Silver Ghost Rolls-Royce as a wedding gift for her husband. Unable to wait months for the Berkeley Square showroom to deliver the desired cabriolet design, she purchased a second-hand model from the Prince of Wales for £2,000 and then lavished another £2,000 on customizing its interiors (the new owner was eight inches taller than his predecessor). Lord Louis also spent a small fortune redecorating the private suite of his Brook House London mansion. As befitting someone with a lifelong passion for the sea, he turned it into a replica of his naval cabin: the ceiling was lowered to ship’s specifications; the bed was replaced with a bunk and the windows with a port hole; and the bathroom was decorated with shells, fish and seaweed to evoke an underwater feel. To add a touch of authenticity, a generator was installed to replicate the throbbing of the ship’s engines.

  Edwina was able to dispose some more of her surplus wealth on the poorer relations she had acquired through marriage. She gave a helping hand to the family of Dickie’s sister, Princess Alice who had to flee her Greek home after her husband Prince Andrea of Greece was sentenced to death on trumped up charges following a coup. She eased the financial hardship by renting their Corfu villa “Mon Repos” where their son Prince Philip had been born in June 1921 on the dining room table. As we shall see later, she and Lord Louis also gave generous financial support to Philip as a boy and until his marriage to Princess Elizabeth.

  After the war some of the Mountbatten wealth was poured into a costly four-year restoration of another country retreat - Classiebawn castle, a near derelict turreted Victorian manor house set in 1,500 acres of rugged terrain in Mullaghmore on the west coast of Ireland. Edwina had inherited the property on the death of her father in 1939. She does not refer to it by name in the codicil to her will that was necessitated by his death but in one of the added new clauses she stipulates that all her remaining property (which presumably includes Classiebawn) should be treated in the same way as the transfer of the Broadlands estate. In other words, a lifetime right to the castle should go to her husband and on his death, it should pass to her eldest daughter and after that to her younger one. Indeed on Edwina’s death - as confirmed by a recent biographer of Mountbatten who was given full access to the family archive - a life interest in the property was bequeathed to Lord Mountbatten.20 By 1962 the property was haemorrhaging money at such an alarming rate that he seriously considered selling it. In one year the estate's net loss was £1,800. But when he realised the economic hardship the sale could cause the local community, he was forced to explore a less drastic remedy. He attempted to rent it to holiday makers and even approached the pr
ime minister of the Irish Republic offering to make it available rent free in return for the state paying the rates and other overheads. The Taoiseach politely declined the offer saying that he appreciated "the generous gesture and the friendly feeling towards Ireland." In the end, he found a local businessman, Hugh Tunney, who in 1976 was prepared to pay for a twenty-one year lease, fund most of the running costs and allow Mountbatten access to the castle for the month of August.

  On 27 August 1979 Lord Louis was relaxing aboard Shadow V on a fishing trip close to Classiebawn when the IRA blew up the boat killing him, his fourteen-year-old grandson, Nicholas Knatchbull, the eighty-three-year-old Dowager Lady Brabourne, as well as the fifteen-year-old shiphand Paul Maxwell, and leaving his daughter, Lady Patricia Brabourne, his son-in-law, Lord Brabourne, and his grandson, Timothy Knatchbull with horrific injuries. The IRA claimed he had been “executed” as an act of war against “the English ruling class” and its “imperialist heart.” Ironically papers in the Dublin national archive later revealed that Mountbatten had long advocated a united Ireland.21

  Although such a violent end was beyond his wildest imaginings, Mountbatten had planned meticulously for his death, to such an extent that he surpassed even Queen Mary in his succession planning. This was illustrated not just in the long lists dividing the chattels in his estate but also in every detail of his funeral set down in an "informal note" to the Lord Chamberlain running to eleven pages and a more detailed family file several inches thick. On the day of his burial on September 5, his naval commands were obeyed to the letter - down to the prescribed dimensions of the tablet that was to be placed over his grave at Romsey near Broadlands.

  The earlier service at Westminster Abbey attended by the Queen, King Olaf of Norway, the Queen Silvia of Sweden, King Juan Carlos of Spain, Prince Rainier and Princess Grace of Monaco and heads of state from all over the world had all the pomp and pageantry of a state funeral. Mountbatten's one great regret in planning his farewell parade was that he could not be there himself. Being such a showman and self-publicist, the grand old Earl had few inhibitions about his private life and thus would have been expected to want to display the contents of his will and his overall estate to the general public. After all, in the last months of his life he had gone out of his way to disclose that his father had had an illegitimate child and that there was no shame in sharing family secrets.

  But - as the formality of his funeral revealed - there was another side of his personality that loved tradition and royal protocol. In accordance with protocol for a member of the royal family, he had wanted his body laid-in-state in the Chapel Royal at St James's Palace. By the same token, he should have requested that his will be automatically sealed. So, which side of his character would prevail? What would it be transparency or secrecy?

  The typed entry in the probate register for "Mountbatten of Burma, Earl Louis Francis, Albert, Victor, Nicholas of Broadlands Romsey Hampshire" contains one annotation written in red ink "Royal will: Copy will not be opened to public inspection". His most recent biographer observes that as a member of the royal family he no doubt felt he was perfectly entitled to keep his private affairs confidential through a sealed will.22

  Whatever the reasoning behind the decision it was not to hide the size of his estate or minimise death duties. The official calendar records that he left an estate of £2,196,949 - the third largest estate in the one hundred year history of sealed royal wills. It is not clear whether the probate figure is net or gross. If it is indeed after deductions of debts and other liabilities, then with the top rate of capital transfer tax in 1979 at 75% on estates over £2,010,000, his executors could have been faced with a six-seven figure tax bill. Clearly, Mountbatten was better at state funeral planning than estate tax planning.

  Although Lord Louis's will was sealed, because his family have always been refreshingly open with biographers and in their own writing, it is not difficult to piece together the contents of his estate and how it was administered. From the list of sealed royal wills, we learn that there were three executors - Lord (John) Brabourne, his erstwhile aide-de-camp and son-in-law who became the son he never had and earned his complete trust, particularly since he was one of the few brave enough to stand up to him; Patricia, Countess Mountbatten, his elder daughter who with no male issue inherited his title and to whom such was his devotion that he spoke to her every day and once wrote to her that she was the only woman in his life; and Edwina Hicks, the daughter of his younger daughter, Pamela, who in a strange echo of a previous Edwina's relationship to her grandfather, was treated as a favourite granddaughter and showered with gifts and affection. In his choice of executors, Mountbatten had adroitly covered all the family bases - son-in-law, daughter and granddaughter.

  Thanks to family records and testimony, we know what happened to Mountbatten's landed properties. In his memoir of his grandfather's assassination and his own narrow survival, Timothy Knatchbull discloses that his elder brother, Norton, inherited Broadlands and the title Lord Romsey in 1979.23 The first born of Lady Pamela and Lord Brabourne, he was Mountbatten’s eldest grandson and his most direct male heir.

  Edwina's will laid down that in the event of Lord Louis dying a life interest in Classiebawn would pass to their eldest daughter, Pamela - and Knatchbull’s book confirms this transfer did indeed take place.24 But due to the security worries of her husband, she never again set foot in the castle she owned. In February 1991 it was sold to Hugh Tunney, the millionaire businessman who had leased the property for the previous fifteen years keeping open the option of the Mountbatten family using it for the month of August. But after the death of Lord Brabourne in 2005 she was persuaded by her son Timothy to make one last surreptitious visit to Classiebawn - sneaking in this time as a trespasser.

  Timothy also reveals in his memoirs what happened to Mountbatten’s personal possessions. A confidential letter from his grandfather disclosed that most of the valuable private property went to his grandson Norton and his heirs but he did leave "personal souvenirs" of him and the Mountbatten family to his other grandchildren.25 In the last years of his life he had painstakingly catalogued and collected ninety boxes of memorabilia which were to be left with a personal note and a personal chart of his family tree to each of his grandchildren and his two grand nephews. Among the one hundred and forty-nine items in the eight boxes left to Timothy were a silver ash tray with coat of arms, a gold sovereign, various medallions and a set of three volumes on naval medals by Lord Louis of Battenberg. This was a seminal work on numismatics written by his great grandfather in his retirement years after he had been unfairly drummed out of the navy and later forced to sell his own collection of medals to make ends meet. Timothy was particularly touched to find among the items left to him a pair of gold and amethyst cufflinks with a note from his grandfather explaining they had once belonged to the first Lord Louis.

  Despite his best efforts to avoid the charge of favouritism by standardising his gift-giving, each grandchild got a different set of Mountbatten memorabilia. Ashley, the first son of his younger daughter Pamela, was fortunate to receive some of his naval possessions - including his Morse code kit, the compass and sextant from one ship he served on and other instruments of navigation from his personal yacht. As a souvenir of his grandfather, Ashley also received a translation of an account of a visit that Lord Louis made to the Mikado on a tour of Japan in 1881. The fact that Lord Mountbatten went out of his way to leave two of his grandchildren relatively insignificant heirlooms from Lord Louis indicates the importance he placed on keeping his father's memory alive.

  Since Lord Mountbatten’s death his closest relatives have kept the flame alight by ensuring that the Broadlands Archive - the collection of family papers - was made widely available. In 1989 - on the tenth anniversary of the assassination - 4,500 boxes of photographs and documents were left on loan to the University of Southampton which after a grant from the National Heritage Fund bought the material in 2010. Today any registered online-user c
an have access to the Mountbatten database containing approximately 250,000 papers, 50,000 photos and quantities of recordings on audio-tape and video-tape - although no copy of his will.

  8.THE BURIAL OF BAD NEWS - 1969-1971

  "These figures [on the tax exemption for royal annuities] have been given to the committee but are not for disclosure and have been omitted from the evidence as printed”

  Treasury briefing paper for the Chancellor of the Exchequer, 14 December 1971

  On a humid rainy morning in June 1971 in the Treasury Chambers off Whitehall, the Chancellor of the Exchequer, Anthony Barber, met privately with two senior members of the royal household: the Lord Chamberlain, Lord Cobbold, and the Keeper of the Privy Purse and Treasurer to the Queen, Lord Tryon. Taking the minutes of the meeting was Barber’s private secretary, Bill Ryrie, who marked his record of the discussions "SECRET."

  Although there had been no royal deaths since Princess Marina’s in 1968, royal inheritance in the form of the hereditary revenues was high on the agenda for the Treasury and the palace. It had been placed there by the crisis in the royal finances caused by the rampant inflation - the worst since Napoleonic times with prices rising 74% and wages 126% between 1953-70 - which had forced the Queen to dip into her hereditary income to make up for the under provision of the Civil List. As the Duke of Edinburgh famously lamented to an American television interviewer, if the royal finances go into the red next year and nothing changes "we may have to move into smaller premises, who knows?"