Where did the Queen get millions to bail out Andrew? | Public Service Private Wealth

Prince Andrew this week settled his court case vs Virginia Giuffre, with an enormous payout reported to be $10-15m.  The Queen  is to help Prince Andrew pay his settlement, and his massive legal fees, however this will come from her own private wealth and the sale of his Swiss Chalet, and not from taxpayers funds.

Which begs the obvious question – where does the Queen get that kind of money?  The monarchy is an institution devoted to public service on behalf of the nation, and not a private money making scheme, so where did this cash come from?

The principle that the monarch should not exploit their position to amass a private fortune goes back to the earliest days of the constitutional monarchy – Bad King John’s path to Runnymede to sign the Magna Carta and Charles I walk to the executioners block both started with fights over what was the Monarchs own funds and what belonged to the country as a whole.

The modern constitutional monarchy is defined by the Act of Settlement passed after the Glorious Revolution of 1689.    One of they key principles of the Act is that the monarch should have no private funds of their own, only those voted for by Parliament.   This was a crucial constitutional check, because it meant that the monarch could not pursue their own policies or act without the approval of Parliament.  The King using his own money to run their own policies was a key factor in the confrontation between Charles I and Parliament which led to the English Civil War and his execution.

Instead of private wealth the monarch was allocated funds from Parliament.   No monarch for the next 200 years amassed a private fortune – in fact all of them died in debt, which had to be settled by Parliament posthumously.   In 1760 in order to settle the debts of George II the Monarchy relinquished nearly all of their land and holdings to form the Crown Estate, the proceeds of which went to the Treasury.

The first constitutional monarch to be massively wealthy was Queen Victoria, Empress of India.   During her reign the Civil List was increased to over £400k per year, an enormous sum in the C19th, which made her the richest woman in the world.   There were breathless stories in the foreign press about her private investments, including New York skyscrapers, but pinning them down is very difficult, and many of them look to be lurid exaggerations.   When she died she passed on mostly property like Balmoral, and jewellery bought from her Civil List allowance.

After WW1 most of the great Royal Houses of Europe were overthrown, and the position of the British Royal family was fragile. The rules on private wealth were slackened to allow the Royal House a contingency if they ever had to go into exile, for example if the Battle of Britain was lost and Hitler had invaded the King Emperor would have gone to Canada to try and rally the Empire from there. Their limited private funds were to allow them to live if Britain fell to war or revolution.

The monarchy become more and more circumspect about their wealth; they were wealthy from the civil list, but not conspicuously so.   George VI complained bitterly about his lack of funds after he had to buy Balmoral and Sandringham from the abdicated Edward VIII.   He also felt the need to forgo a years payments from the Civil List in solidarity with his citizens hardship in the Great Depression.

By 1970 the wealth of QEII over and above the Civil List was estimated at £2m, nearly £30m in todays money.   She was wealthy but not super wealthy.    This looks to be typical for C20th monarchs.   

And then the law changed.  

In 1973 the palace successfully lobbied the Heath Government to make the monarchs private financial affairs secret.  Since then not only are current finances protected from scrutiny, but the release of historic papers under the 30 year rule are limited.

We do know that her net worth has increased in real terms more than 10 fold to somewhere around £400m.   Much of this comes from the Duchy of Lancaster, and other landed properties, including Sandringham and Balmoral, but she has huge fortunes in rare stamps, a horse racing stud, vintage sport cars., jewellery and one of the best private art collections in the World.  

Since 1993 the Queen has paid a sum of money equivalent to her tax bill back to the treasury on the proceeds of her private wealth

The Sovereign Grant Act 2011 brought the law in line with reality by limiting the public contribution to the costs of the monarchy but recognising their private wealth as legitimate.

The Royal Families private wealth would have been a huge scandal 100 years ago, but we just shrug and accept that members of the Royal Family exploit their position for private gain, and that the Prince of Wales uses his Royal Palaces to sell chipolata sausages.

Despite all of this I do have  a lot of admiration for her.   I think she will be remembered as Queen Elizabeth the Great, the last really great European Crowned Head.  A tiny old lady who lived her life completely separate from the population of the country she leads, never interacting with them in any meaningful way, and yet somehow leading the nation through huge radical and irreversible changes.  Always changing, always the same.    

This awful business with Andrew should never have been allowed to drag on this long, if he was going to settle with a massive payment he should have done so years ago, not now.    The Queens’ connection with the nation, and her judgement of it’s moods and currents might be as astute as ever, but the judgement of Andrew is catastrophic and it remains to be seen if Charles is any better when he ascends to the throne.  

The financial opacity and the use of public office to amass private wealth is a huge problem.   Our current Government of chancers are using their offices to make themselves and their mates wealthy.   If the Monarch is doing the same then it sets an example that politicians will follow.   Her ability to be a figurehead and role model for our national values is tarnished by the pursuit of private cash.

And now that this aspect of the Act of Settlement has been over turned it paves the way for King Charles, a reactionary paleo-conservative, to fulfil his ambition to shake off the restrictions on political interference.  

The monarchy, the BBC, the NHS and the CodE form a set of plural institutions that bind us together even if we each disagree with at least one of them.  These shared institutions are in a bad way right now, and how cohesion as a nation is the weaker for it.   It used to be that Conservatives believed in plural and cohesive institutions, but right now it is the Conservative party reborn as authoritarian English nationalists who are breaking them up.  

There may be left wing republicans quietly enjoying the Monarchy’s travails right now, but right now we need our shared institutions to bring us together, not fragment us even further.

2 thoughts on “Where did the Queen get millions to bail out Andrew? | Public Service Private Wealth

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.