Speaking of royal families worldwide, the first family name that comes to mind is the British Royal Family. Once upon a time, almost one-fourth of the world used to be run under the British regime. Because of that, a common saying was known that the sun never set on the British empire. However, after the territories were established as independent states after the end of World War II, the British Empire also fell. Since the United Kingdom maintains a constitutional monarchy, the royal family is no longer as powerful as it once was but still it’s standing there a symbol of the Golden Age of the UK.
Apart from their multiple castles, several arts, and jewelry kept at the museum, hundreds of thousands of Tourists from around the world visit this family’s palace, which is more than 1100 years old, as well as. In the financial year of 2019-20, almost 3.3 million tourists visited the British royal family’s several residents and from that UK government earned more than £71.5 million. The British Royal family is considered the most valuable brand in England with a value of more than £67 billion. But apart from tourism, what are the other ways this royal family earns?
In 1688, the British Royal Family gradually distributed the authority of its massive empire to the elected government and to its different departments by adapting the constitutional monarchy system. The constitutional monarchy is mainly a government system where the queen remains as the head of state but they don’t reserve the right to actively participate in the country’s politics and retain political power. Instead, they perform several government activities as symbols of the Royal Family. As a result, 15 countries like England, Scotland, Wales, Northern Ireland, and Australia are still loyal to the monarchy of the British Royal Family, while the majority of monarchies in the world are governed by state constitutions.
The reign of Queen Elizabeth Alexandra Mary Windsor ended in September 2022, when she died, and until her death, she was the head of state or the Crown. After the queen’s death, her eldest son, Charles Philip Arthur, took responsibility as the head of state. By doing so, KingCharles Philip Arthur has become the head of the military, the judiciary, the civil service, the Supreme Governor of all the Churches of England, as well as the head of the Royal Family and the United Kingdom. Moreover, the KIng is also respected as the head of state of 14 other Commonwealth countries, including England, however, he does not have much involvement in these countries’ government and political activities.
Back in the past, in order to operate the British Empire, people paid taxes to the crown, and it was used to carry out the cost of the Royal Family and also used for the development purpose of the kingdom. Due to the constitutional monarchy nature of the United Kingdom, the responsibility of managing the countries under its jurisdiction rests with the government or the first minister of the country, so the taxes paid by the people are directly deposited into the Treasury of the government. In such a system, how does the British Royal Family maintain their livelihood, and how are they funded?
The British Royal Family has been maintaining a luxurious lifestyle for ages. In addition to Buckingham Palace, Kensington Palace, Balmoral Castle, and St. James’s Palace, there are 23 castles or forts serving as residences, of which Balmoral Castle and Sandringham Estate were favorites to departed queen Elizabeth which has property value of about consecutively £140 million and £65 million pounds. The royal family has to spend around £50 million per year on maintaining all these properties. Besides the Duchy of Lancaster and Cornwall, the British Royal Family owns millions of hectares of land, as well as heirlooms worth about £6 billion.
On the other hand, for traveling home and abroad, they have a private jet- Voyager, private train- Royal Train, and for regular transportation, they have Bentley State Limousine and Rolls-Royce Silver Wraith II LWB’, besides they also have many luxurious cars like Rolls-Royce Phantom, Audi RS6, Range Rover Hybrid LWB, and Land Rover Defender. Besides, the handbag Queen Elizabeth carried with her was made by England’s luxury brand, “Launer London,” and the queen always had this brand’s bag with her. According to the company, in the lifetime of the queen, the company exclusively supplied more than 200 bags only for her. From the queen to the royal family, they have multiple private chefs for all family members.
But how are these expenses managed to maintain such a lifestyle of the British Royal Family? In 2021, the total expenditure of members of the Crown Family was around 97 million pounds (96.9 million pounds). Even for looking after the royal member at Buckingham Palace and for helping in other activities, more than 500 staff are needed, and their cost is around £2.41 Million . Moreover, according to insider, members of the royal family wear exclusive designer collections outfits as royal outfits that cost around several lakh dollars. But to sustain this expenditure, from which source did the British royal family generate the revenue?
Earning Sector of British Royal Family
The Sovereign Grant
The most significant earning part of the royal family generates from the Sovereign Grant. Sovereign Grants are the funds the British Government provides each year for His Majesty’s official duties, the maintenance of the Royal Household, and the payment of royal salaries. According to the Sovereign Grant rules-2011, the activities of the Sovereign Grant operated from the country’s treasury ministry.
An amount is paid as a sovereign grant to meet the official expenses of the Royal Family, which is mainly a fixed portion of the publicly funded income from the Crown Estate allocated by the Royal Trust. There are several properties of the British royal family Scattered throughout England to Scotland and around Wales. These are combinedly considered as the crown states. There are about 1 lakh 16 thousand hectares of land in these states. There are several types of land, including commercial and agricultural lands, in these crown states.
Government and royal family share ownership of these lands. These assets are used for various public and state aspirations, and they are known as “The Sovereign Public Estate,” with total assets of 17.97 billion pounds. The royal family’s dues are transferred to their Treasury as a rule, and Sovereign Grants generated from the Crown Estates are first deposited in the Government Treasury.
In the financial year of 2013-14, the number of Sovereign Grants was 15 percent, but later, as suggested by the Royal Trustees for the resurfacing of Buckingham Palace, it was decided to increase its amount by 10 percent till the financial year 2026-27. Therefore, it was decided to expand its amount by 10 percent until the financial year 2026-27. As a result, from the 2017-18 financial year, 25 percent of the total income of the Sovereign Grant was deposited by the country’s government into the treasury of the Royal Family.
The amount of Sovereign Grant money for a particular financial year is determined by the amount of money received from the Crown Estate in the two previous financial years. For example: in the financial year of 2021-22, the total revenue generated by the crown estate was 312.7 million pounds. However, in the same financial year, the reservation of Buckingham Palace for the Royal Family was 34.5 million pounds. In contrast, the preferred Sovereign Grant amount was 86.3 million pounds, which is basically more than 25 percent. Because this amount of the crown estate was approved based on the income of the previous two-year income, according to the Sovereign Grant act 2011, if the crown estate earns less for a year’s expectation, still the Sovereign Grant will remain the same as it was predetermined.
Privy Purse & Duchies
Another income source of the British Royal Family is the privy purse which bears the two types of expenditure of crown officials and private. Privy Purse mainly indicates the money gained from the Duchi. The Duchy means vast areas of lands owned and controlled by a Duke, and the earnings from that Duchy used to be handed over to the Crown. Currently, the British Royal Family owns two Duchies. They are The Duchy of Lancaster and the Duchy of Cornwall. The Duchy of Lancaster is mainly under the crown, which means it is the personal income of the king or the queen.
On the other hand, the control of the Duchy of Cornwall is handed to the next successor of the crown. The total land of the Duchy of Lancaster in England and Wales is about 18,481 hectares, which has been used as the personal property of the Crown for the last 700 years. The total assets combined with commercial, agricultural, and residential properties are about 652 million pounds.
There are about 1 lakh 31 thousand acre lands on which the valuation of the commercial asset is 450 million pounds/dollars, under the Duchy of Lancaster and Duchy of Cornwall. At that time, Prince Charles Philip Arthur was the successor of the crown before becoming the king, and he was the Duke of Duchy of Cornwall. However, after obtaining the authority of the crown, his elder son Prince William Arthur Philip Louis, the successor of it, became the Duchy of Cornwall, previously the Duck of Cambridge.
Lancaster and Cornwall- from these Duchy estates, the revenue of the British Royal Family in the Financial year 2021-22 was 45 million pounds, on the other hand, revenue from the Duchy of Lancaster was 28.69 million pounds which were more than 1.1 million pounds in the financial year of 2020-21. Moreover, the crown commercial properties from east London are also included in this Privy Purse. Several expenditures of the Royal Family also come from this Privy Purse or Duchies. For instance: in 2020, from the income of the Duchy of Cornwall, Prince Charles and his elder son gave 6 million dollars to their family.
Personal Wealth and Income
Apart from the Sovereign Grant and Privy Purse, there are several assets that the queen exclusively owns. Those are artworks, stamp collections, gregorian papers, military maps, and swords known as the Royal Collection. For example, there is a stamp collection of king George V, whose value is 100 million pounds, a Victorian Suite, a Sapphire Brooch, Marie’s Brooch, a Russian Brooch, an Imperial State Crown, and more royal ornaments, and also several items that their ancestors used.
The Royal Family also earns money from this Royal collection. Maintaining the Royal Collection, there is a Royal Collection trust established in 1993, which organizes the exhibition of this collection, which is a part of the income of the British Royal Family. In the financial year of 2021-22, total revenue was 24.04 million pounds from the exhibition of the Royal Collection.
Moreover, the departed queen Elizabeth II had an interest in horse racing. There were more than 1000 horses in her horse stable. She engaged her horses in horse racing events, earning more than 9 million pounds from that.