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| Queen's grant: Treasury still controls sovereign fund not Scots | Queen's grant: Treasury still controls sovereign fund not Scots |
| (about 4 hours later) | |
| The royal household is annoyed and appears to be picking a fight with Scotland’s government over the Queen’s share of the UK’s largest and most valuable property portfolio, the Crown Estate. | The royal household is annoyed and appears to be picking a fight with Scotland’s government over the Queen’s share of the UK’s largest and most valuable property portfolio, the Crown Estate. |
| The publicly owned property empire, which takes in Ascot racecourse, London’s West End, Highland estates, farms, shopping centres, leisure parks, mining operations and most of the UK’s seabed and coastline, as well as lucrative licences to install wind farms and wave energy machines on the seabed, is worth billions of pounds. | The publicly owned property empire, which takes in Ascot racecourse, London’s West End, Highland estates, farms, shopping centres, leisure parks, mining operations and most of the UK’s seabed and coastline, as well as lucrative licences to install wind farms and wave energy machines on the seabed, is worth billions of pounds. |
| Under the Sovereign Grant Act 2011 the Queen receives an equivalent share of the Crown Estates’ annual revenues from the Treasury, pegged at the moment at 15% of the organisation’s surplus. Her total grant next year under the act will be worth £42.7m in 2016-17, up from £40m this year. | Under the Sovereign Grant Act 2011 the Queen receives an equivalent share of the Crown Estates’ annual revenues from the Treasury, pegged at the moment at 15% of the organisation’s surplus. Her total grant next year under the act will be worth £42.7m in 2016-17, up from £40m this year. |
| Related: Scottish funding changes will not leave Queen £2m short, Treasury says | Related: Scottish funding changes will not leave Queen £2m short, Treasury says |
| As part of the post-independence devolution settlement, brokered by all five parties in Scotland under the Smith commission, Scotland will take control of £216m of Crown Estate property from April next year. | As part of the post-independence devolution settlement, brokered by all five parties in Scotland under the Smith commission, Scotland will take control of £216m of Crown Estate property from April next year. |
| Under the formula the loss of direct income to the Treasury reduces the Crown Estate share of the sovereign grant by £2.2m this year. According to Sir Alan Reid, keeper of the privy purse, that “does confuse the issue of renegotiating the percentage in due course”. | Under the formula the loss of direct income to the Treasury reduces the Crown Estate share of the sovereign grant by £2.2m this year. According to Sir Alan Reid, keeper of the privy purse, that “does confuse the issue of renegotiating the percentage in due course”. |
| But is the royal household going to war with the right people? Scottish ministers are bemused: the Edinburgh government does not control this funding; the Treasury does. Neither is Holyrood changing the law; Westminster is. | But is the royal household going to war with the right people? Scottish ministers are bemused: the Edinburgh government does not control this funding; the Treasury does. Neither is Holyrood changing the law; Westminster is. |
| In fact, it was the Scottish parties and Scottish parliament which flagged up this issue, at one key stage doing so in a UK-government run commission populated with Whitehall civil servants. Not only that, the Treasury insists it is working to sort it out, to protect the royal family’s funding. | In fact, it was the Scottish parties and Scottish parliament which flagged up this issue, at one key stage doing so in a UK-government run commission populated with Whitehall civil servants. Not only that, the Treasury insists it is working to sort it out, to protect the royal family’s funding. |
| Royal household sources have also accused Scots ministers of reneging on a private pledge by Alex Salmond, made when he was first minister and before last year’s independence referendum, saying Scotland would continue funding the royal family. | Royal household sources have also accused Scots ministers of reneging on a private pledge by Alex Salmond, made when he was first minister and before last year’s independence referendum, saying Scotland would continue funding the royal family. |
| The Times story on this bluntly stated: “Scotland is to snub the Queen by pulling out of a deal to fund the monarchy, Buckingham palace believes.” It suggested that republican nationalists in Edinburgh were now taking revenge for the Queen’s support for a no vote in the referendum. A palace official was cited saying: “Originally, Alex Salmond did imply that might happen. But the new leadership said no.” | The Times story on this bluntly stated: “Scotland is to snub the Queen by pulling out of a deal to fund the monarchy, Buckingham palace believes.” It suggested that republican nationalists in Edinburgh were now taking revenge for the Queen’s support for a no vote in the referendum. A palace official was cited saying: “Originally, Alex Salmond did imply that might happen. But the new leadership said no.” |
| The difficulty with that proposition is that Salmond’s promise came before the referendum. Salmond, then leader of the Scottish National party and (unlike many nationalist activists and MSPs) an avowed supporter of the monarchy, was assuming a yes vote; he was planning for independence. | The difficulty with that proposition is that Salmond’s promise came before the referendum. Salmond, then leader of the Scottish National party and (unlike many nationalist activists and MSPs) an avowed supporter of the monarchy, was assuming a yes vote; he was planning for independence. |
| Under that scenario, the Crown Estate would be split up and Scotland’s parliament would take complete control of its country’s assets and surpluses. And any contribution by Scotland to the sovereign grant scheme would need to be fully renegotiated – assuming Holyrood wanted to use that route to fund the royal household at all. | Under that scenario, the Crown Estate would be split up and Scotland’s parliament would take complete control of its country’s assets and surpluses. And any contribution by Scotland to the sovereign grant scheme would need to be fully renegotiated – assuming Holyrood wanted to use that route to fund the royal household at all. |
| But the SNP lost the referendum, and instead Scotland remains part of the UK, its funding being largely controlled by the Treasury. The sovereign fund remains reserved to Westminster. | But the SNP lost the referendum, and instead Scotland remains part of the UK, its funding being largely controlled by the Treasury. The sovereign fund remains reserved to Westminster. |
| What vexes Scotland’s government now is that on this issue, unlike many others where it relishes and creates turf wars with the UK government, it does not want conflict. It supports an all-party deal to devolve the Crown Estates’ Scottish holdings to Holyrood and local council control. | What vexes Scotland’s government now is that on this issue, unlike many others where it relishes and creates turf wars with the UK government, it does not want conflict. It supports an all-party deal to devolve the Crown Estates’ Scottish holdings to Holyrood and local council control. |
| It says its purpose is not to undermine the royal household but to increase local accountability and directly link policy-making with local prosperity. This cause has been championed by rural campaigners in Scotland for more than 10 years. The then Labour-dominated Scottish affairs select committee called for Crown Estate devolution, too, in 2012. | It says its purpose is not to undermine the royal household but to increase local accountability and directly link policy-making with local prosperity. This cause has been championed by rural campaigners in Scotland for more than 10 years. The then Labour-dominated Scottish affairs select committee called for Crown Estate devolution, too, in 2012. |
| And all of the five main Scottish parties, which unanimously backed Crown Estate devolution (though with possible reluctance from the Tories) in the Smith commission report in November, warned that this had the side effect of altering the sovereign grant formula. | And all of the five main Scottish parties, which unanimously backed Crown Estate devolution (though with possible reluctance from the Tories) in the Smith commission report in November, warned that this had the side effect of altering the sovereign grant formula. |
| The Smith report was clear: “Responsibility for financing the sovereign grant will need to reflect this revised settlement for the Crown Estate.” | The Smith report was clear: “Responsibility for financing the sovereign grant will need to reflect this revised settlement for the Crown Estate.” |
| It puts the Treasury on the spot: the Smith commission was set up by the coalition government in Westminster, it was staffed by UK civil servants, with Treasury officials among its most senior advisers. | It puts the Treasury on the spot: the Smith commission was set up by the coalition government in Westminster, it was staffed by UK civil servants, with Treasury officials among its most senior advisers. |
| While that also raises substantial questions about what that royal aide was driving at when he blamed Scottish ministers, it puts the onus on the Treasury. Why does Reid appear to be in the dark about what the Treasury is planning? | While that also raises substantial questions about what that royal aide was driving at when he blamed Scottish ministers, it puts the onus on the Treasury. Why does Reid appear to be in the dark about what the Treasury is planning? |
| Related: The Guardian view on paying for the Queen: an embarrassment of riches | Editorial | |
| And finally, the sovereign grant act also protects the royal family’s funding; it makes clear that its grant can never be less than the previous years. Even if the pot it is drawn from shrinks, the sum will not change. | And finally, the sovereign grant act also protects the royal family’s funding; it makes clear that its grant can never be less than the previous years. Even if the pot it is drawn from shrinks, the sum will not change. |
| Now the SNP and Holyrood’s devolution committee are annoyed over the detail of the Crown Estate deal: a battle is proceeding over the UK government’s decision to exclude from devolution a large and expanding retail park called Fort Kinnaird on the A1 on the outskirts of Edinburgh. | Now the SNP and Holyrood’s devolution committee are annoyed over the detail of the Crown Estate deal: a battle is proceeding over the UK government’s decision to exclude from devolution a large and expanding retail park called Fort Kinnaird on the A1 on the outskirts of Edinburgh. |
| So back to the politics. Many SNP activists may be republicans (Nicola Sturgeon, the first minister, is quietly one), but the party knows that fighting the monarchy could be a pointless political battle. It might alienate voters and damage its cause in many far more pressing areas. It remains unclear why the palace thought otherwise – and Scotland’s republican instincts risk being fed. | So back to the politics. Many SNP activists may be republicans (Nicola Sturgeon, the first minister, is quietly one), but the party knows that fighting the monarchy could be a pointless political battle. It might alienate voters and damage its cause in many far more pressing areas. It remains unclear why the palace thought otherwise – and Scotland’s republican instincts risk being fed. |