It is worthwhile considering what a more comprehensive reform of the royal finances might look like in practice. If consolidating all revenue streams into a single pot was the overriding principle, then it would also have made sense to include (and perhaps maximise) the revenue from the Royal Collection. With its one million artefacts including seven thousand paintings and five hundred thousand engravings squirreled away in a variety of palaces (and their basements), this has long been an unexploited seam of income for the Royal Household. An obvious solution to the lack of palace space might be to turn one major residence, say Buckingham Palace, into a permanent museum displaying the royal treasures in much the same way as the Louvre was originally set up. At present “BP” has only limited opening to the public in the summer when the Queen is in Balmoral, a missed commercial opportunity that was recently criticised by the Public Accounts Committee. Given its prime, central London location, if open all year round it would certainly prove a big money-spinner with tourists who could be charged Louvre-style prices to enjoy the Royal Collection. That revenue could be used to pay for the upkeep of the palaces and other Royal Household expenditure. Privately, the royal family might well welcome vacating a property which according to one recent resident was like “living in the middle of a traffic roundabout” and which was openly detested by Princess Diana and Edward VIII.5 Even George VI was in no hurry to move in after the abdication and neither was the Duke of Edinburgh after the coronation.
Reform of the Royal Collection could extend to producing a comprehensive catalogue of its treasures and a comprehensive on-line inventory available to the public. The difficulty of tracing the Queen Mother’s bequest of a Monet painting which at first appeared to belong to the Royal Collection but turned out to be the private property of the Queen highlighted the problem of ambivalent ownership, raising the old suspicion that Royal Collection items have been mixed with private ones. A comprehensive inventory would establish once and for all who owns what and whether it is on public display or not.
In a similar spirit of transparency, the royal family could publish an inventory of their private jewellery collection to determine which items are private property and which are held in trust for the nation. This could allay the suspicion that in the distant past some jewels – particularly those received as gifts – have been flipped from one category to another. It is known that both Queen Victoria and Queen Mary made detailed inventories of crown and non-private jewels but very few people have been able to see these documents. The two jewellery experts who were granted limited access to the Royal Collection (Suzy Menkes and Leslie Field) were both left in the dark as to where to draw the line between public and private property.6
As part of this process of transparency, the palace might publish any guidelines they may have relating to the status of wedding gifts. In the wake of the Burrell trial and the subsequent Peat Report, a set of general guidelines on gifts was made widely available in March 2003, but it does not go into any detail about the thorny issue of wedding presents which - as we have seen - may prove extremely lucrative for bride and groom when the total number of gifts are valued in aggregate. Princess Margaret's children got their fingers burnt when they sold off what some thought “public” wedding gifts and it is noticeable that when Prince William got married, he requested that those wishing to give him and Kate a wedding present should make a donation to charity instead.
In a further step towards transparency, there could be a greater clarity in the rules governing the sealing of royal wills. Although the will of the sovereign is kept secret by statute, the rules governing the publication of the wills of other royals are simply based on a legal precedent set by Prince Francis in 1910. But as we saw with the case of the Duchess of Gloucester in reality the practice of sealing royal wills is totally arbitrary and may depend ultimately on the personal whim of the executor. If you have an open-minded royal like the current Duke of Gloucester you have an open will. This means that any member of the public can now inspect the will of the one-hundred-and-two-year-old Duchess of Gloucester - although they are not permitted to view the will of the one-hundred-and-one-year-old Queen Mother. By the same token, anyone can inspect the will of Princess Helena Victoria - although not the will of her sister Princess Marie Louise. Similarly, anyone can inspect the will of Prince Louis of Milford Haven but not the will of his son Prince Louis of Burma. And as for Princess Diana, the most famous deceased royal of them all - who lost her royal title and was then offered it back after her death - everyone in the world can view her will on the internet. The working group reviewing this anomaly as part of a wider revision of probate rules was expected by some optimists to publish its conclusions in the early 2010s but at the time of writing, all that has appeared is a set of draft rules which have been sent to the Ministry of Justice.
Some MPs and at least one QC suspect that sealed wills are used to disguise the extent of royal wealth. Norman Baker MP as a backbencher often advanced this charge, arguing that if the parliament knew the scale of the wealth of the Windsors, it would be reluctant to grant them a generous financial settlement. As it turns out, parliament has recently granted them a generous settlement and now that they have to some degree safeguarded the publicly-controlled side of their income and wealth, one would hope that there is less reason for them to be so secretive about their testamentary affairs.
It was clear from the trials and tribulations surrounding the Duke of Gloucester’s estate that one of the most sensitive aspects of the succession process is the transfer of landed property. A root and branch reform of the royal finances might clarify this. If under the new regime, the future sovereign were asked to vacate Buckingham Palace for the Royal Collection, then this could set in motion a long-overdue chain reaction in property transactions. Charles could then move to, for instance, Windsor Castle and use Highgrove or Sandringham as his private country residence. But a comprehensive reform of the royal finances might also encompass bringing Sandringham and Balmoral under some degree of public control. If the royal family claim that they cannot afford to keep the two private residences (which are also used for official duties) without a tax exemption from the public purse, then would it not be simpler to give the properties to the National Trust or some other public body? This is what customarily happens to other great landed families when they lack the means to pay death duties and this is indeed what Edward VII was obliged to do when he agreed to give Osborne House, the private residence of Queen Victoria, to the nation. If Charles or William wanted to continue to use Balmoral, there is no reason why they could not retain a smaller house like Birkhall on the estate or simply rent the property as Charles has done with the Queen Mother’s Castle of Mey, which incidentally is another royal residence that was transferred out of private ownership.
This property down-sizing might signal an important step towards a leaner, slimmed-down monarchy. If there are too many royal palaces, then the same could be said of the royals themselves. Many now question why such a large and costly royal family is necessary when the hereditary principle in its crudest form requires no more than “an heir and a spare” – or perhaps for safety’s sake, a few more extras. An accusing finger has sometimes been pointed at the current sixth in line of succession, Princess Beatrice, who was accorded extremely expensive security when she went on a beach holiday to Thailand. As we have seen, some estimates of the cost of protecting all members of the royal family run as high as £100m a year – more than three times the official cost of the Royal Household. Considerable savings to the security bill could be made by having a smaller royal family along Scandinavian lines. This could well work to the financial advantage of many junior royals like the Kents and Gloucesters whose elevated status as HRHs limits their range of paid employment. In practice, the closer one gets to the throne, the harder it is to do commercial work. When Prince William left his job as a RAF rescue helicopter pilot, there was little question of him pursuing a professional career elsewhere and he was obliged to go bac
k to college for a management course in preparation for running the Duchy of Cornwall’s landed estate. Some wondered at the time whether he would have been better off remaining in the armed services where at least he had a well-defined job to do. Indeed, in August 2014 it was announced that he had decided to join the East Anglian Air Ambulance as a pilot.
When Prince Edward ventured into the television business through his company Ardent Productions, he was pilloried in the press for exploiting his family name and only making films about the Windsors. In the end his firm floundered. Prince Michael of Kent has encountered similar publicity problems with his company Cantium Services. Prince Richard had to give up a promising architectural career when he became Duke of Gloucester and now faces public censure when he tries to run his country estate in a commercial manner. His mother may have had a point when she wrote that you had to choose between leading a royal life and pursuing a professional career.
Having a leaner monarchy might also require the media to cut junior royals more slack and allow them to fail at business without intrusive scrutiny – or indeed to succeed. Who knows the new House of Windsor might even add to their wealth through old-fashioned private enterprise rather than tax privileges from the state.
* * *
Fewer royals, fewer palaces, fewer tax privileges and greater transparency over wealth, wills and gifts - how likely is it that any future sovereign would agree to such a radical break with the past?
For all his image as an old fogey, some palace insiders maintain that Charles as king would willingly embrace change. After all, he has spent much of his time as Prince of Wales being a fountain of ideas, chairing debates on environmental issues and bombarding government ministers with letters on new policy directions. According to this school of thought, once on the throne he would want to move with the times and if that meant reform beyond the existing Sovereign Grant, then he might be willing to negotiate a long term financial settlement.7
A move from Buckingham Palace to Windsor Castle has in the past been seriously considered. However, given Charles’ sentimental attachment to Balmoral, it is difficult to imagine him agreeing to dispose of his mother’s Highland estate so that for twelve months of the year it would be trampled over by tourists. The same might be true of Sandringham on which, some say, he would love to stamp his own personality with a major refit. Even if his desire to move with the times is sincere, it might be difficult for a sovereign in his seventies to change a habit of a lifetime and live less lavishly.
Realistically one might have to wait a generation for a genuine new broom. Providing he is also not too old when he succeeds to the throne, William would be more likely to downsize the royal household than his father. Already the signs are encouraging – his wedding gifts were donated to charity, his first married home was an unostentatious residence in Anglesey and the size of his household staff in his new flat at Kensington Palace has been kept relatively modest, even though the cost of the palace refurbishment has far exceeded the estimated budget and brought some rare criticism. When he went to Canada on his first foreign trip as a married man and then to Australia on his first overseas visit as a father, his entourage was considerably smaller than is customary on such tours. As the son of Princess Diana, he knows only too well what happens when the media circus gets too large and the royals lose control of the reins. After her death he saw how her executors had to rewrite her will to protect her intellectual property rights after an explosion of merchandise bearing her famous face and now he, Kate and Harry have wisely set up their own companies to safeguard their brand name.
The death of Diana also showed how quickly the public mood can change. In the space of a few days the popularity of the royal family plummeted as a hitherto revered monarch was suddenly perceived as cold and uncaring. So, even if today the Queen enjoys very high approval ratings and her subjects seem unperturbed by the special treatment granted to the royal finances, it might only take one sudden event – a financial scandal at a time of nationwide belt-tightening (as happened with the Spanish royal family in 2014) or the death of a less popular royal and the disclosure of the true size of their estate - for the consensus to change.
As one of the royal family’s savers rather than spenders – and like her sister a great planner rather than an improviser when it comes to succession matters - the Queen may leave a legacy of financial prudence and probity along with her estimated £300 million estate, but her successors risk diluting the worth of the Windsor brand unless they move with the times and bring their finances into the twenty-first century. As we enter into a more transparent digital age and a younger generation takes up the royal reins, the hour may be right – to rework Walter Bagehot’s famous phrase - to let in daylight upon their money.
ACKNOWLEDGEMENTS
Anyone dipping a toe into the little-navigated waters of the royal finances owes a huge debt to that master mariner Phillip Hall who first started the long voyage of discovery with his pioneering work “Royal Fortune: Tax, Money and the Monarchy” (Bloomsbury, 1992). He was also a principal contributor to the most comprehensive valuation of royal wealth - The Mail on Sunday’s “The Royal Rich Report.” Both those works inform this one, even though my emphasis and conclusions are very different.
When it comes to royal jewellery, two other ground-breaking studies - Suzy Menkes’s “The Royal Jewels” and Leslie Field’s “The Queen’s Jewels” - provided through their unprecedented access to the Royal Collection an invaluable source for tracing the provenance of the Windsors’ jewellery box.
I am also indebted to several recent royal biographers who were granted access to the Royal Archives: the most recent Jane Ridley for her magisterial portrait of Edward VII (“Bertie” 2013) which followed Philip Eade’s study of the Duke of Edinburgh (“Young Prince Philip” 2011), William Shawcross’s authorized biography of the Queen Mother (“Queen Elizabeth” 2009) and Jonathan Dimbleby’s biography of Prince Charles (“The Prince of Wales” 1994).
Three other prolific royal chroniclers – Philip Ziegler (“King Edward VIII” and “Mountbatten”), Sarah Bradford (“Diana,” “Elizabeth” and “George VI”) and Hugo Vickers (“Elizabeth, the Queen Mother” and “Behind Closed Doors – the tragic, untold story of the Duchess of Windsor”) provided a treasure trove of financial and biographical information.
I also owe a large debt to the work of Michael Bloch, Gyles Brandreth, Tina Brown, Paul Burrell, Alastair Campbell, David Cannadine, Caroline Blackwood, John Dean, Anne de Courcy, Noble Frankland, Robert Hardman, Nicholas Haslam, William Hamilton, Tim Heald, Simon Heffer, Brian Hoey, Anthony Holden, Robert Lacey, Andrew Marr, Chris Mullin, Gavan Naden, Max Riddington, Andrew Roberts, Geoffrey Robertson, Peter Russell, Anne Sebba, Jon Temple and Christopher Warwick
I wish to thank the following copyright holders – HarperCollins (Reprinted by permission of Harper Collins Publishers Limited Copyright Philip Ziegler, “Edward Heath”, 2010), Sheil Land (Robert Rhodes James “Chips – The Diaries of Sir Henry Channon” Weidenfeld & Nicolson 1967 ‘granted by permission of Sheil Land Associates Ltd’), Random House (“Behind Closed Doors” by Hugo Vickers published by Hutchison Reprinted by permission of the Random House Group Ltd) and John Murray Press, an imprint of Hodder and Stoughton Ltd, (“Inside Asquith’s Cabinet” by Sir Charles Hobhouse [ed. Edward David] © reproduced by permission of the publisher John Murray Press). I am also grateful to the Oxford University Press and Hull University Press/Library of the University of Hull for granting me permission to reprint extracts from Robert Bahlman (ed) “The Diaries of Sir Edward Hamilton.”
Strenuous efforts have been made to trace the copyright holders to quote from their books and diaries. I apologise to any copyright holders I have been unable to reach and I promise to rectify the situation in future editions.
I would like to thank my indefatigable agent Andrew Lownie who helped shape the scope and focus of this book. Without his work as literary executor, “Royal Legacy” would never have been granted
probate. I am also indebted to David Haviland at Thistle Publishing for his expert guidance in preparing the manuscript for publication.
I am also grateful to the staff of the Rothschild Archive and the National Archives for their assistance and advice. I would like to extend one final word of thanks to the hard-working and highly professional staff of the British Library - a national institution which is a living testament to the value of open access of information to the general public.
ARCHIVAL SOURCES
NATIONAL ARCHIVES
Treasury papers of 1901 Civil List (T326)
Treasury papers on the 1911 Civil List (T168)
Treasury papers on the Civil List 1970-71 (T326)
PUBLIC RECORD OFFICE OF NORTHERN IRELAND
Private papers of Earl of Kilmorey
MOUNTBATTEN ARCHIVE
Private papers of Lord Mountbatten
ROTHSCHILD ARCHIVE
Private papers of Leopold de Rothschild
PRINCIPAL REGISTRY OF THE FAMILY DIVISION
Will of HRH Princess Alice, Duchess of Gloucester
Will of HH Princess Helena Victoria
Will of HH Prince Louis of Milford Haven
Will of Diana, Princess of Wales
Will of Edwina, Countess Mountbatten of Burma
PARLIAMENTARY REPORTS etc
Royal Legacy: How the royal family have made, spent and passed on their wealth Page 35