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Sovereign Grant Act 2011

Summary

3.The Act provides new arrangements to support the Sovereign in Her official duties. The arrangements are intended to move from the current civil list arrangements which are reign-specific to a permanent regime which will cover all future Sovereigns, subject to each new Sovereign consenting to extend the Sovereign Grant provisions, and so to continue the payment of the hereditary revenues as directed in section 1 of the Civil List Act 1952, for the duration of his or her reign.

4.At present the government provides four grants to the Royal Household to support Her Majesty The Queen in Her official duties:

  • the civil list - an annual grant provided by Parliament direct from the Exchequer to meet the core official expenses of The Queen’s Household, so that The Queen can carry out her role as Head of State and Head of the Commonwealth;

  • a grant-in-aid for Royal Travel - the Department for Transport provides annual funding to the Royal Household to meet the costs of official travel by air and rail;

  • a grant-in-aid for the maintenance of the Royal Palaces: the Department for Culture, Media and Sport is responsible for maintaining the Royal residences and contracts with the Royal Household to do so.

  • a separate grant from that department covers expenditure on communication and information.

5.The Act develops a new streamlined system of support for Royal Household expenditure on Her Majesty’s official duties as sovereign. It puts a new unified Sovereign Grant in place of the existing grants. Like the current system of support, the new grant will not meet The Queen’s personal expenses.

6.The new Sovereign Grant is to be linked to the net income surplus (or profit) of the Crown Estate. The Crown Estate is the property of the Sovereign “in right of the Crown”, though its revenue is surrendered to the Exchequer in return for government support. This exchange has been made on the accession of each sovereign since George III in 1760.

7.The Sovereign Grant is to be paid each year through the Treasury Estimate. The Comptroller and Auditor General (or C&AG, who is the government’s external, “public auditor”) will audit the Royal Household’s use of the grant, which will be open to full Parliamentary scrutiny. In short, the Sovereign Grant will be treated like other government grants.

8.The Sovereign Grant will normally be set equal to 15% of the net income surplus (profit) of the Crown Estate for two years before. The Sovereign Grant is to be determined through a formula (set out in section 6). However, the Crown Estate will continue to pay its annual income surpluses in full into the Consolidated Fund. That is, the Sovereign Grant will not directly hypothecate a share of Crown Estate revenue.

9.Any Sovereign Grant unused in a given year will go into a Reserve Fund. Section 6 gives the Royal Trustees (a body corporate established by section 10 of the Civil List Act 1952, whose members are the Prime Minister, the Chancellor of the Exchequer and the Keeper of the Privy Purse) a duty when setting the grant to seek to prevent the reserve rising beyond about half of the amount of the annual net relevant resources used by the Royal Household. The Royal Trustees could do this by reducing the grant in that year.

10.The Trustees will also periodically review the formula for calculating Sovereign Grant and recommend change if they see fit. The Treasury will implement the Trustees’ recommendations through orders which will require the approval of the House of Commons.

11.The Sovereign Grant will resemble other government grants in a number of important ways: it will be paid through Estimates authorised by Parliament annually; its accounts will be published; they will be audited by the public auditor (the Comptroller and Auditor General) and subject to Parliamentary scrutiny, including by the Committee of Public Accounts.

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Explanatory Notes

Text created by the government department responsible for the subject matter of the Act to explain what the Act sets out to achieve and to make the Act accessible to readers who are not legally qualified. Explanatory Notes were introduced in 1999 and accompany all Public Acts except Appropriation, Consolidated Fund, Finance and Consolidation Acts.

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