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Sovereign Grant Bill

What concerns me is not the fall in expenditure over the past 10 or 20 years, which most people would consider sensible—notwithstanding the issues raised by my hon. Friend the Member for North Durham (Mr Jones)—but the fact that we are set to see real-terms rises in the years ahead. That is where we should focus our scrutiny. On the other hand—on the side of the ledger that does not feature efficiency savings—we are seeing rising pressures on the royal family. As I said a couple of weeks ago, the combination of the success of the wonderful royal wedding and the visit of the Duke and Duchess of Cambridge to Canada and the USA, following Her Majesty's historic visit to Ireland, has resulted in a rise in both the popularity of the royal family and the demands on them around the world, and that trend is set to continue. It is important that we scrutinise whether the resources that are in place are sufficient and right. I raised in the last debate the fact that it has been reported that a number of members of the royal family have had their security reduced or removed over the past year. I accept the Chancellor's assurances that there are no concerns in that regard, but it was right that we raised the issue. We have tabled amendments to clauses 2 and 4 that are designed to ensure both that there would be full and independent scrutiny of all the different aspects of royal expenditure, including the level of the grant and, more widely, value for money and the effective spending of resources across the piece, and that the National Audit Office would have sufficient powers and resources to do that job. My hon. Friend the Member for North Durham asked about wider expenditure outside the sovereign grant. As I understand it, it should now properly come within the purview of the NAO to look across the piece. In our upcoming debate on those clauses, perhaps we could receive an assurance that the NAO will be able to look at all the budgets, not just this particular one. Clearly, the NAO will not be able to reach a judgment on value for money in terms of royal household expenditure under this grant unless it can do so in the context of the other expenditures by Government Departments for the royal household. It is important to maintain royal protection and security, but protecting value for money is also important. The NAO and the Public Accounts Committee will need to respond to the issue my hon. Friend has raised and make sure they can see the full picture. I say again that we seek assurances in the upcoming debate on those clauses that the NAO will be able to look right across the royal household's expenditures, rather than only at the expenditure financed by the sovereign grant. The Chancellor has moved very much in our direction on our second issue. I argued a couple of weeks ago that, given the historic importance of these reforms and the inevitable uncertainties at the beginning of a new financing regime, Parliament would need to keep a closer eye on the arrangements. I also said that that needed to be consistent with the Chancellor's proper desire to give the royal household stability and certainty. In our judgment, waiting seven years for a review, and certainly seven years for the first review, was too long. In our amendments to clause 7, we propose that the first review should happen in the period up to April 2015—three years from now—with five-yearly reviews after that. The Chancellor has gone pretty much to where we would like to be on these matters. Therefore, we thank him for taking our concerns seriously and making sure Parliament will be able to take an early view on these arrangements. On our third issue, however, I have a continuing concern, which has prompted our amendment 8 to clause 7. The issue is the level of profits from the Crown Estate. The Chancellor has told the House that"““we need a funding mechanism that prevents the sovereign coming to Parliament each year for resources, and that provides funding broadly in line with the growth of the economy…There will be a cash floor to protect the monarch from cash cuts, but basically the monarch will do as well as the economy is doing.””—[Official Report, 30 June 2011; Vol. 530, c. 1146.]" We do not know going forward that the figure of 15% of Crown revenues will prove to rise in line with the overall performance of the economy. That obviously depends on the performance of the Crown Estate and Crown revenues. As I pointed out, the Crown Estate income from renewables grew by 44% in the year 2009-10, and it is widely expected to increase again in future years because of the financial potential of the exploitation of wind and tidal energy on the foreshore around the country. The Crown Estate's annual report describes current growth as ““exponential”” and growth over the next 10 years as ““significant””. Given the potentially significant changes in income from renewables and, perhaps, wider sources, as well as the prospect that this could lead to an unintended rise in either reserves or, as described in the Bill, simply the overall level of expenditure, it is important that the proposals are robust in meeting significant unintended rises in revenues. Some have called for a cap on the overall level of the sovereign grant. Instead, we have tabled amendment 8, which would require the trustees to review the arrangements if the Crown Estate's income were to rise faster in the previous financial year than the underlying trend growth rate of the economy. I think that the public would expect the trustees to review matters immediately if revenues were to rise much faster than had been expected. I also think that the amendment is fully consistent not only with the spirit of the Chancellor's reforms, but with their detailed intention, as he set out in his spending review speech. Therefore, I ask him to look at the issue again over the next hour and a half. Our proposal is fully consistent with protecting stability for the monarchy and the proper role of Parliament in scrutinising the arrangements. In order to ensure that his reforms are implemented as he intended, we should agree to the amendment.