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Sovereign Grant Bill

I would like to make a little progress, if both hon. Gentlemen will allow me. Let me say a little more about the Bill, and then I will be happy to take questions. Clause 1 proposes the creation a sovereign grant designed around three principles. First, it is sustainable, so that it provides reliable, long-term financing for the sovereign that is free from annual political argument but gives the House of Commons proper checks and controls. Secondly, it is flexible in dealing with the problem I described whereby money saved on travel cannot be spent on palace maintenance and vice versa. Thirdly, it is accountable, as I have been saying, because of the historic increase in parliamentary scrutiny of royal expenditure. Because the Queen is one of the few Heads of State in the world who is genuinely completely above the party political fray, I want to take this opportunity to thank my opposite number, the shadow Chancellor, and his team for conducting themselves in a very proper way as the loyal Opposition in asking questions. We will come on to the questions that he has rightly asked. [Interruption.] I suggest that his Parliamentary Private Secretary, the hon. Member for Vale of Clwyd (Chris Ruane), banks this moment, because it might not come again in this Parliament. We have tried to be as open as possible. I know that members of the shadow Chancellor's team met the Treasury officials on the Bill team yesterday. As I will explain, I propose to accept a couple of his amendments. The shadow Chancellor asked four questions in the debate two weeks ago. I propose, for the rest of my remarks, to answer those four questions. It will be up to him and the House to decide whether they are adequate answers, but I thought that that was the best way to approach this matter. His first question was about the level of the sovereign grant, the second was about the mechanism for uprating it, the third was about the new arrangements for greater parliamentary scrutiny, and the fourth, which relates to some of the interventions we have just heard, was about the way in which the Government provide other forms of support to the royal family. I will take each question in turn. On the level of the sovereign grant, as we discussed two weeks ago, for many centuries the Government of the day have used taxpayers' money to fund the official duties of the monarch. In return for that financial support, every King and Queen since George III in 1760 has agreed to surrender for their lifetime the full income of the Crown Estate to the Government. Nothing in the Bill changes that. The Crown Estate's profits will continue to flow into the Exchequer, as they have done for the past 250 years, and we will continue to use them for general public expenditure. The funding for the monarch will continue to be provided by the taxpayer out of the money voted in the estimates. Our approach is new in the sense that we are choosing a new reference point for the calculation of the support that we give the sovereign. We propose that the Queen should receive a grant equivalent to 15% of the profits made by the Crown Estate in the financial year two years earlier. To put it another way, the sovereign grant in 2013-14, which is the first year in which the mechanism will operate, will be equivalent to 15% of the Crown Estate's profits in 2011-12. Why do it in that way? We could of course have chosen some other measure. We chose this mechanism partly because it establishes the historical connection between the Crown Estate and financial support for the monarch. The real reason was that we were looking for a mechanism that was broadly in line with the economy and that would be more permanent. One important change in the Bill, which was referred to in the debate on the time resolution, is that we will no longer require Parliaments—I hope future Parliaments—to pass primary legislation within six months of the arrival on the throne of a new monarch, which is the case under the civil list arrangements. We are trying to establish arrangements that are not to do with the current personality of the monarch, but that endure beyond that and allow the royal household to plan for the future with certainty.