The recent news that the Queen had inherited an estate worth an estimated $70 million from her mother without having to pay the normal 40% inheritance tax — despite an agreement a decade ago to pay full income tax — reignited all the old controversy and speculation about the Queen's wealth and income. The reality is that only a tiny handful of people know how rich the Queen actually is.
During the last decade, unofficial estimates of her personal fortune have veered wildly between $70 million and $9 billion. The Sunday Times in its 1989 British "rich list" estimated her fortune at $7.5 billion. But this year's list, published in April, had her down to her last $399 million and in 125th place behind the Duke of Westminster, who took pole position with $6.8 billion. The only remotely authoritative hint about the Queen's wealth came in 1993 when Lord Airlie, then Lord Chamberlain, said estimates of $145 million or more were "grossly overstated."
The problem with assessing the Queen's fortune has been both the tight secrecy shrouding her affairs and the blurring between what the Queen owns as an individual and what belongs to the sovereign as head of state — which is how an earlier estimate made her the richest woman in the world. The bulk of the fabulous Royal Collection of art, with its paintings, sculpture, furniture, silver and Fabergé eggs, is deemed part of the national patrimony, but some items are privately owned and exactly which is sometimes hard to establish. Again, other than such obvious items as the crown jewels, it's often unclear what among the Queen's multimillion-dollar jewelery collection is hers to sell. Property is easier: the Queen privately owns only Balmoral Castle and its lands in Scotland and the Sandringham estate in Norfolk. Buckingham and Kensington Palaces, Windsor Castle and Clarence House, among other royal properties, are owned and subsidized by the state.
The taxpayer funded the royal family to the tune of about $51 million in 2000-01. The state pays the Queen $11.5 million a year, capped until 2011, and the Duke of Edinburgh receives another $520,000. But the Queen reimburses the Treasury for any annuities paid to her children and other relatives. Meanwhile, income from the Crown Estate, which is held by the sovereign but is not privately owned — it consists of farmland, forests, commercial property and parts of London's West End — go to the Treasury, as they have done since George III's time. Postal services worth some $1.7 million come free, and royal residences, other than Balmoral and Sandringham, are maintained at a public cost of about $22 million a year. Another $7.7 million goes toward royal travel, which has seen some cutbacks in recent times — the Queen shed a few tears when her beloved royal yacht Britannia was mothballed in 1997.
Her public income is supplemented by private funds on which she pays tax: this includes the Queen's investment income (one estimate puts that at some $8 million a year), income-in-kind from private properties and the revenues (around $10.5 million last year) from the 20,000-hectare Duchy of Lancaster estate, one hectare of which lies beside London's Savoy Hotel. Charles, meanwhile, gets no public subsidies but lives off the taxed revenues from the Duchy of Cornwall estate, which has remained exempt from capital-gains tax on asset sales. Yet Charles, in effect a trustee, can't keep the proceeds from any asset disposals, only the revenues from their reinvestment.
Is the royal family worth the taxpayers' millions? They contribute to the pomp and pageantry of British heritage that fuels the nation's $93-billion-a-year tourism industry. The financial value of their charity work and public functions, while vast, is harder to quantify. But then how much would a president cost?
