The Sovereign Grant
Section 9: Duchy of Cornwall income and grant to the heir to the throne
72.This section adjusts the Sovereign Grant where the Duke of Cornwall is under 18 and where there is no Duke of Cornwall.
73.When the Duke of Cornwall is under 18, the amount of Sovereign Grant in each year or part year is reduced by 90% of the income account net surplus of the Duchy of Cornwall for the period. A corresponding amount of the Duchy’s income is placed at the disposal of Her Majesty. Duchy income does not increase the Sovereign’s resources because the Sovereign Grant is reduced proportionately. That arrangement reflects the current statutory provisions for the civil list.
74.Where the revenues of the Duchy of Cornwall are vested in Her Majesty (because there is no Duke of Cornwall) the section provides for the amount of the Sovereign Grant to be reduced by the amount of the income account net surplus of the Duchy for that period.
75.When Duchy revenues are vested in Her Majesty, the section also provides for a grant to be made by the Treasury to the heir to the throne (who would not be the Duke of Cornwall). Such heirs, if they are adult, would receive a grant equivalent to the amount by which the Sovereign Grant has been reduced on account of the Duchy revenues. If they are under 18, they receive 10% of that amount. The net effect is broadly that an adult heir to the throne, whether or not that person is also Duke of Cornwall, receives the equivalent of the net income of the Duchy. If the heir is a minor, the equivalent of 10% of the Duchy’s net income is received.
76.Subsection (1) applies when the Duke of Cornwall is under 18. When that happens, the Sovereign Grant is reduced by 90% of the income account net surplus of the Duchy. An equivalent amount of Duchy income is placed at the disposal of the Sovereign to offset that reduction.
77.Subsection (2) provides that where the Duchy of Cornwall is vested in Her Majesty the amount of the Sovereign Grant for that year is reduced by an amount equal to the net income of the Duchy of Cornwall for the relevant period. When that happens, the heir to the throne is to receive a grant payable by the Treasury.
78.Subsection (3) sets the amount of the Treasury grant payable under subsection (2). If the heir is aged 18 or over, the grant is equal to the reduction in Sovereign Grant that is made for the period. If the heir is under 18, the grant is 10% of that amount.
79.Subsection (4) provides that where the grant is payable to an heir who is under 18 it will be paid to the Royal Trustees who are to hold it on trust for the heir on such terms as the Treasury direct.
80.Subsection (5) provides that any reduction in the amount of the Sovereign Grant under section 9 is to be ignored for certain purposes such as calculating the need for payments into and out from the Reserve Fund. That is because any reduction in the Sovereign Grant to take account of income the Sovereign receives from the Duchy does not affect the overall resources at the Sovereign’s disposal. Rather it means the same amount of resources are being provided from two sources not one.
81.Subsection (6) provides that income from the Duchy of Cornwall is treated as part of the Sovereign Grant in sections 2(7)(b) and 11 of the Act where the amount of the Sovereign Grant has been reduced under section 9. That is because in these circumstances Duchy income is a replacement for Sovereign Grant and needs to be treated as such.
82.Subsection (7) provides that for the purposes of determining the income account net surplus for part of a financial year, the income net surplus for the whole year is to be apportioned equally in respect of each day of that year.
83.Subsection (8) is required to work out how much the Treasury grant should be.
84.Subsection (9) allows the Treasury to make the reductions required by this section, and to pay the grant under this section, on the basis of an estimate of the net income of the Duchy of Cornwall for a financial year or part financial year until the accounts of the Duchy of Cornwall have been submitted to the Treasury in accordance with section 2 of the Duchies of Lancaster and Cornwall (Accounts) Act 1838. Any necessary adjustments may be made after those accounts have been submitted.
85.Subsection (10) makes the Treasury grant payable out of money provided by Parliament.
