She’s dropped off the rich list, so how are the Queen’s finances?

Queen Elizabeth II. Picture: PA/Leon Neal.

Queen Elizabeth II. Picture: PA/Leon Neal. - Credit: PA Wire/Press Association Images

Hampstead writer David McClure tells Bridget Galton about the true state of Windsor wealth.

Her face graces every bank note in the country, but as she reportedly drops out of the top 300 on the Sunday Times’ rich list, what is the state of the Queen’s finances?

As she enters her 90th year, few doubt our monarch’s lifelong service, or begrudge the £35 million Sovereign Grant that funds her expenses, but the Windsor’s inherited wealth and assets are another matter, subject to privileged protection that keeps them from public eyes or parliamentary scrutiny.

A tenacious Hampstead author has dug in the archives to dissect the Royal Family’s multi-million pound property and investment portfolio and shed light on the transfer of land, artworks, and jewellery that ensures the preservation of their wealth.

“People say the Queen doesn’t have much cash which is true, she’s cash poor and asset rich, most of which she can’t sell, but the Royals do have some very lucrative private assets,” says former Reuters journalist and TV producer David McClure.

“While she’s extremely hardworking with a tremendous sense of duty and comparatively frugal, as she passes the baton to Prince Charles, it’s worth remembering the monarchy is a lottery. You get savers like George V and VI, and spenders like Edward VII and VIII who didn’t want to work hard.”

In Royal Legacy (Thistle Publishing) the 58-year-old former Fitzjohn’s Primary pupil follows the history of royal inheritance from Queen Victoria to Queen Elizabeth II.

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He became interested after acting as executor for his parents’ estates.

“It was a complicated process and by the end I was quite an expert on inheritance, wills and probate.”

While researching in the probate register in High Holborn he found two unpublished royal wills of the Queen’s aunt Princess Alice, and Queen Victoria’s grand-daughter Princess Helena Victoria.

“There’s normally a 30-year rule on official government papers but these papers were closed for 100 years. The Royal Family effectively have privileged privacy. Senior Royals are exempt from FOIs and benefit from other privileges when it comes to protecting their privacy. Royal wills are sealed by statute, the finances of Prince Charles’ Duchy of Cornwell aren’t open to scrutiny by the National Audit office and are audited by the Treasury not parliament, who suspect they go through on the nod.”

McClure discovered that most of the Windsor’s inherited wealth derives from Queen Victoria.

“When she came to the throne in 1837 the Royal Family were almost penniless, by the time she died in 1901 she was one of the richest people in Britain. How did that happen?”

The answer lies in the Victorian property boom and rising cost of 19th Century land prices as the railways paved the way for new development.

Victoria made money from her Duchy of Lancaster estates, just as our current Royals make theirs from commercial property. Charles’ Duchy of Cornwall owns Oval Cricket Ground and the Savoy Estate, part of the Duchy of Lancaster yields millions in commercial rents from the strip of land between Somerset House and the Savoy Hotel.

“Optimising their portfolio has meant in 10 years Prince Charles’ revenue rose by £10million.

“These are very well run, not by grey courtiers but astute, highly paid people. It’s their own private money and the income is their private affair. They don’t want the these cash cows discussed. It’s a grey area.”

While the Sovereign Grant pays for public expenses, press, travel and the upkeep of Buckingham Palace and Windsor Castle, McClure found a hazy division between private and public expenditure when paying tax on income earned from the Queen’s property and estimated £110 million investment portfolio. “A lot of what we deem private expenditure is put under public expenditure.” The Queen also has a huge collection of heirlooms, jewellery, art, and cars “the best collection of British and Commonwealth stamps in the world worth anything between £10 and £100 milllion, and the greatest private collection of jewellery in the world”.

Yet there is no catalogue for these assets and most are gifted away long before they incur inheritance tax. The Queen Mother left her £35million art collection tax-free to the Queen;“transferred to the Royal Collection”, Queen Mary’s hugely valuable jewellery collection was nowhere to be found in her £500,000 estate, and Princess Margaret gifted her Mustique villa to her son 10 years before her death, saving millions in inheritance tax.

“The way the wealth is transferred as gifts by stealth means you can’t trace it,” says McClure who was born and raised in Hampstead. He doesn’t claim to be an expert: “This is not the final word on the royal finances but I would like to spark a debate.”