The Queen is to get a bailout from the taxpayer after her land and property investments plummeted due to coronavirus pandemic
- Treasury said it will top up the Sovereign Grant to help maintain Queen’s income
- Monarch’s income is based on a 25% share of the profits of the Crown Estate
- Queen will now be receiving money that would have funded public services
The Queen will receive a bailout from the taxpayer after her land and property investments plummeted in value due to the coronavirus crisis.
The Treasury said last night that it will top up the Sovereign Grant to help maintain her income, which is severely threatened by the pandemic.
The monarch’s income is based on a 25 per cent share of the profits of the Crown Estate, which owns valuable land in London and elsewhere. Last week, the estate announced its profits would fall ‘significantly’ this year as a result of the Covid-19 pandemic.
But the Treasury has now disclosed that, despite this, it will not let the Queen’s income drop. Instead the link to profits will be broken and her income for 2022/23 will remain the same as the previous year.
The Queen will receive a bailout from the taxpayer after her land and property investments plummeted in value due to the coronavirus crisis
She will therefore keep more of the Crown Estate’s profits, which in effect means she will be receiving money that would otherwise have gone to fund public services. News of the bailout is set to be controversial at a time when millions of people have suffered pay cuts or lost their jobs.
Details of the Sovereign Grant for 2021/22 – which is linked to Crown Estate profits for 2019/20 – are due to be announced tomorrow.
This is expected to give the monarch an increase of 0.4 per cent to £86.3million.
The rise of around £350,000 may prove to be below the level of inflation. The small increase is because the estate’s profits rose by just 0.4 per cent in 2019/20 to £345million, as revealed in last week’s annual report.
The Treasury said last night that it will top up the Sovereign Grant to help maintain her income, which is severely threatened by the pandemic
But the report also pointed out that the profit level was due to fall. Crown Estate chief executive Dan Labbad wrote: ‘Many of our real estate markets were already facing long-term structural challenges, which have now been accelerated as a result of Covid-19… We do expect our net revenue profit and property valuations to be significantly down.’
However, the Treasury said this did not mean the Sovereign Grant would fall in 2022/23, because of the way the legislation was drawn up. A spokesman said: ‘In the event of a reduction in the Crown Estate’s profits, the Sovereign Grant is set at the same level as the previous year.’
They added that the flip-side of the legislation was that if Crown Estate profits increase significantly, the grant will be capped to prevent the royal household receiving excessive funding.
‘The revenue from the Crown Estate helps pay for our vital public services – over the last ten years it has returned a total of £2.8billion to the Exchequer,’ they said. ‘The Sovereign Grant funds the official business of the monarchy, and does not provide a private income to any member of the Royal Family.
‘The formula ensures that the amount contributed to the Exchequer far exceeds the amount given to the monarch.’ Robert Palmer, of campaign group Tax Justice UK, said: ‘This royal bailout will be tough to stomach for people who love the Queen but have lost their jobs and businesses during the pandemic.’
Graham Smith, of the anti-monarchy group Republic, added: ‘The rules for the Sovereign Grant incorporate a ‘golden ratchet’ – once the grant goes up it can never come down, and the taxpayer loses out.’
Last night a spokesman for Buckingham Palace said: ‘The core Sovereign Grant supports the official duties of the Queen and the maintenance of the occupied royal palaces and is calculated on 15 per cent of the income surplus of the Crown Estate.
‘An additional 10 per cent was agreed to fund a ten-year reservicing of Buckingham Palace… Our Sovereign Grant report outlines where the money is spent, the scale of the work it supports and also the contribution made to the costs through income generation such as visitor admissions.’