The his and her family firm: The publicly-funded pinnacle of inequality in wealth and power

Tommy Sheppard lays out the case against the monarchy.

I’m not sure which is the more depressing: that the UK has just reaffirmed the hereditary right of kings or that a majority of its citizens demonstrably agree with that situation. Despite this, as we begin the new Caroline era, a grown-up debate about the future of the monarchy is, surely, overdue.

Where to begin? Let’s start with democracy. It is ironic, is it not, that in a so-called democracy the one office citizens can never aspire to hold is that of head of state? The idea that this position should be determined by accident of birth and, forever, be the preserve of just one family offends every notion of democracy.

There are ten hereditary monarchies left in Europe. All of them claim to be constitutional with their role defined by and subject to a legal framework of governance. In all others, the monarch swears to abide by and uphold the constitution. Not in the UK. Here the coronation vows, which we shall witness next May, require a declaration of respect for God and church. No reference is made to Parliament, the people, or any notion of a democratic framework.

The allegiance is the other way round. In order to represent the people that elect them to Parliament, its members must first swear loyalty to the unelected monarch. To all intents and purposes, the British monarchy is imperial in nature, a relic of bygone eras, and exceptional in the modern world.

The majority of people appear to endorse this arrangement, though support is declining. A YouGov poll in May this year put support for the monarchy across the UK at 60%, with 27% favouring abolition and 17% having no opinion. In contrast, most young people do not agree with the Monarchy. In Scotland the institution has only 45% in favour, with 40% against.

Still, it is remarkable that support for an unelected head of state should be so strong. The security of those in positions of power and privilege often relies on the deference of those who have neither. Throughout history, humans have evolved into creative critical creatures, developing the capacity for common endeavour to enrich ourselves and harness the resources of nature. Deference is the enemy of that progress.

But it’s not just centuries of forelock tugging that keep us in our place. The active promotion of the idea of a hereditary monarchy by the media and state are important too. In fairness, the royal household has a public relations operation that is second to none and is adept at playing a mass media which ranges from an embarrassingly sycophantic national broadcaster to voyeuristic tabloids treating royals as another source of celebrity gossip.

The British monarchy is the most expensive in Europe by far. In terms of direct funding, it is seven times as expensive as Spain’s royal household. It is funded in three ways: a sovereign grant provided by parliament, profits from the duchies of Lancaster and Cornwall, and earnings from private investments.

The sovereign grant replaced the civil list in 2011 and is calculated as a percentage of the profits made by the Crown Estates. The Crown Estate is a government agency which manages a huge portfolio of land and property, valued recently at £15 billion. None of this belongs to the royal family; they are assets owned by the state on behalf of the public and were nationalised in 1760. But the name creates confusion and allows monarchists to claim the institution costs a small proportion of what it brings in. If the monarchy was abolished, none of the Crown Estates would disappear and all of the profits would go to the treasury.

The grant was initially set at 15% of the Crown Estate profit. In 2016, that was upped to 25%, on the justification that the extra would pay for repairs to Buckingham Palace. As a member of the parliamentary committee which took that decision, I vehemently opposed the majority view. Last year, the Crown Estate made £312m profit. To be clear, that cash does not go directly to the monarch, but the sum is used to calculate the level of the sovereign grant paid by the Treasury. A clause in the 2011 Act provides that the grant will never be less that the year before. If the Crown Estates do well, royal funds increase. But if they have a bad year, the grant will not be reduced.

The Duchy of Lancaster is a private estate worth £640m which generated £24m profit last year. This, alongside the Duchy of Cornwall owned by the Prince of Wales, has an ambiguous status which the royals have a history of exploiting when it comes to managing their finances. On the one hand they claim the commercial secrecy which comes from being a private corporation. On the other, the Duchies pay no capital gains or corporation tax like every other private company, claiming exemption as part of the monarchy.

The monarch also has enormous private wealth and receives considerable funds from investments. The late Queen Elizabeth’s wealth was estimated by the Sunday Times earlier this year at £370m, which included Balmoral and Sandringham as well as racehorses and a portfolio of shares. It is not known how much income this generates, and we have no right to ask.

Royal finances are shrouded in secrecy. The late Queen Elizabeth’s will is hidden from the public. Never in our lifetimes will we find out whether some of this income, boosted by decades of state aid, will pass to private interests here or abroad. What we do know is that whatever passes to the King will be exempt from inheritance tax.

The monarchy is not only exempt from tax obligations, but from freedom of information legislation. Unlike any other holder of public office, the royals have no obligation to report or account for their use of public funds. I have tried repeatedly to find out whether any money coming from the taxpayer was used to pay for Andrew’s out-of-court settlement but to no avail.

Of course, on top of the published figures, the monarchy has many hidden costs to the taxpayer. This includes tax not paid, use of state buildings, costs met by government departments and local councils, and a whopping bill for security. All in all, the campaign group, Republic, estimate the monarchy cost £345m in 2017, a figure which has surely increased by now.

The royals are also remarkably protective of their privilege, willing go the extra mile to max out public income and top up their funds in other ways. I highly recommend former Liberal Democrat MP Norman Baker’s recent book And, what do you do? for a forensic examination of how the royal family use their public positions for private gain. From soliciting gifts to charging appearance fees, the unseemly actions he documents will astound you.

If the monarchy’s finances were more transparent, the public might have more questions about whether the institution should continue. In Scandinavian countries, monarchies have gone out of their way to slim down and try to act ‘normal’ by getting around on bikes and sending their kids to state schools. Not here. There’s seems to be no limit to the extravagance we are expected to fund. In essence, the public are invited to finance a celebration of unearned wealth organised in a feudal hierarchy that glorifies inequality. Such a structure sits very uneasily amidst contemporary society.

One of the arguments most trotted out in favour of the monarchy is that they are good for tourism (see accompanying article, this issue). VisitBritain once claimed that they bring in £500m to the UK economy. This was something of a dubious calculation based on the assumption that since 28% of all heritage visits were to properties associated with the royals, that must mean they were responsible for that proportion of total spend by tourists. In fact, people visit buildings because of their history and architecture, and not the current inhabitants. The most visited royal palace in Europe is Versailles – and there’s not been a monarch in residence for quite some time.

Contrary to popular belief, the constitutional power wielded by the monarch is not purely ceremonial. Whilst the press creates a celebrity circus with prurient tales of the excesses of minor royals, the king plays a significant role in the introduction and passage of legislation. We all know about Royal Assent, the process by which a bill passed in parliament officially becomes the law of the land. Less well known is the process of Royal Consent, the process whereby the monarch must agree to a bill ever being published in the first place. This was used 146 times between 1970 and 2013. It is very much alive today. Crucially, the king gets to decide whether any bill which has an impact on the public and private affairs of the monarch should be debated. Likewise, the Prince of Wales must agree to any proposal affecting the Duchy of Cornwall.

Consent was required for the 2006 Animal Welfare Act, for example, because of the powers of inspectors to check on royal land. The outcome was a special exemption in respect of private royal assets. So, we have strange situation where changing the position of the monarchy would require legislation, but even the discussion of that legislation would require the consent of the people it would most impact. This veto is little talked about. Every democrat should be deeply uneasy at giving this power to an unelected and unaccountable head of state.

Now, of course, there are limits, both legal and practical, to how much the royal family can get away with. And the monarch will almost always do the bidding of the government of the day. But in many ways that gives us the worst of both worlds. The fact that the head of state is unelected means they have no mandate, no authority and no ability to speak out on matters of public concern. Compare the situation across the Irish Sea where, with strict constitutional limits, the elected president plays a role which, while mainly ceremonial, also allows them to contribute to public debate and the process of government.

So, what is to be done? And how does all this affect the political debate in Scotland? At a UK level, the royal succession ought to provide an impetus for renewed discussion. Hopefully, many on the progressive side of politics will feel rather more able to raise their heads above the parapets. Here in Scotland, we are engaged in a live debate about our country’s future with opinion split almost equally as to whether we should become a self-governing country or not. Independence is about the right to determine our own future. If we achieve it, nothing will change the day after, except for having the power and agency to change everything.

It would be a mistake to conflate the arguments about the future of the monarchy with the arguments for independence. One is not a constraint upon or consequence of the other. It is entirely possible that Scotland could become an independent nation state which would remain a member of the Commonwealth and retain the king as head of state. It is also entirely possible that it might become a republic, which appears to be the direction of travel for many other Commonwealth countries.

At the moment, we do not have the right to choose either outcome. I will work with anyone, including monarchists, to win that right. As we move to becoming an independent country, we will need to review everything about how we are governed and develop a modern constitution fit for a new Scotland. That constitution will embody the human and political rights of our citizens and define how we govern ourselves – and it ought to be put to a vote. That will be the opportunity for Scotland to decide whether the medieval relics of the monarchy should continue or be abolished. In the meantime, with the coronation on the way, we need to have an open discussion where those who take a republican view are respected and not demonised.

Tommy Sheppard has been the SNP MP for Edinburgh East since 2015