There's one family living on state handouts that's still smiling after the spending review: the Windsors
We're all this together according to the PM and chancellor, as they inflict savage and sweeping cuts to public spending. Yet there is one family living on state handouts who will not be looking for personal economies to cope with the deficit reduction programme: the Windsor family.
The headlines on Wednesday were that the Queen had agreed to take her share of the burden. But even by the government's own announcement, the cut was only going to be 14%, compared with 10% for education, 36% for communities and local government, 28% for business and 20% for the police. But the reality seems to be that the "reform" of royal finances promised earlier this year and the "cuts" promised this week are just more smoke and mirrors. The palace has secured a nice little deal which could bring them a huge windfall of taxpayers' cash over the next five to 10 years.
Ministers have announced that the civil list and other grants from a variety of departments will all be scrapped and rolled into one single "sovereign support grant". This new fund will not be calculated according to need, it will not be measured and assessed and negotiated according to previous years' spending. It will be pegged to revenue generated by the crown estate, a nationalised property corporation which brings in profits of around £6bn a year.
The palace has been handed a blank cheque, a promise of 15% of all revenue from this property empire. As the economy recovers and property values rise so too will the fortunes of the monarchy. Regardless of any business case or any evidence of real need, the taxpayer will simply hand over the revenue, no questions asked. It is as absurd as it is obscene.
So why has it happened? My guess is that it is an attempt by the government to wash its hands of any responsibility for royal spending, to let the palace have what it wants and do what it wants with the money they get. By tying the grant to the crown estate they are implying a historic link between this revenue stream and the royals, implying too that we are simply paying the royals a portion of what we owe them.
At the same time the government will no longer need to deal with the running fight between the palace and the Department for Culture Media and Sport over property maintenance and repairs to the palace, or deal with the once-a-decade review of the civil list. George Osborne has apparently said that he wants to take the politics out of the issue of royal funding.
The problem is you cannot take the politics out of public spending and you cannot take the politics out of waste of public money. This decision seems to me an outright abdication of the chancellor's responsibility and a surrendering of public money to one pointless and excessive institution.
There is no historic link between the monarchy and the crown estate that says we owe them a penny of that revenue, or any revenue. The crown estate has never been the personal property of the Queen and has always been there to fund the government. If we abolished the monarchy the crown estate revenue would continue to flow to the Treasury, so all this deal is doing is dressing up a shabby deal as a recasting of a historic relationship which has long been misrepresented by monarchists and the palace itself.
Estimates for how much money this deal would give the palace have put the figure at roughly where it is at the moment – between £30m and £40m a year.
How far it will rise under the new scheme is anyone's guess, but when budgets of essential services and welfare are being slashed, every spare million should be going to the public, not to the royals. And yet this is still a fraction of the total cost. Estimates vary, and they are estimates because the government refuses to properly cost and budget for the monarchy or disclose the cost of security. The Republic campaign, who I work for, has estimated the cost to the taxpayer of the monarchy to be around £180m a year, which includes costs to local councils, security and revenue from the duchies of Lancaster and Cornwall (also not the personal property of the Windsors).
That makes our monarchy one of the most expensive heads of state in Europe by a very long way. And as an institution that simply serves to protect a centralisation of political power in the hands of government and parliament, and which serves no useful purpose for the people, the monarchy is one area where we should have been seeing genuine and drastic cuts.