MAINTAINING THE ROYAL PALACES: UPDATED
FINANCIAL INFORMATION (PAC 2000-2001/10)
Memorandum by the Comptroller and Auditor
General updating his Report HC 563 Session 1999-2000
DECEMBER 2000
1. The National Audit Officer report on
Maintaining the Royal Palaces focused on expenditure on property
maintenance projects in the financial year 1998-99, and drew on
the work of the Royal Household's auditors for that year. As the
audited accounts of the grant-in-aid for the financial year 1999-2000
are now available, this memorandum updates the financial information
given in the National Audit Office report where relevant. Amended
Figures, tables and other financial details are shown, cross-referenced
to the National Audit Office report.
COSTS MET
FROM THE
GRANT-IN-AID
(FIGURE 2, PAGE
6 OR C&AG'S
REPORT)
BREAKDOWN OF
THE APPROXIMATE
SPEND ON
THE MAIN
TYPES OF
MAJOR MAINTENANCE
(PARAGRAPH 1.5, PAGE
7)
2. The main types of major maintenance and
the approximate spend in 1999-2000 on each were:
| | 1999-2000 £000
| 1998-99 £000 |
Energy conservation | includes the installation of energy efficient lighting and secondary glazing
| 58 | 87 |
Fire precautions | includes the installation of automatic fire detection equipment, re-wiring, fire compartmentation and improved means of escape
| 999 | 1,671 |
Health and Safety | includes lift modernisation, removal of asbestos, and the repair and replacement of roof walkways
| 314 | 450 |
Housing | includes the repair and refurbishment of self-contained residential accommodation[1]
| 723 | 620 |
Offices and workshops | includes the provision of new and refurbished office and workshop space
| 1,355 | 1,304 |
General maintenance | includes all other expenditure, such as re-roofing, resurfacing roads and paths, redecoration and repairs to the external fabric of buildings
| 3,339 | 3,112 |
| | 6,788
| 7,244 |
COMPETITIVE TENDERING
(PARAGRAPH 2.11, PAGE
13)
3. In total, 203 contracts were let during 1999-2000,
with 196 competitively tendered. The other seven were all under
£10,000 in value.
SOURCES OF
FUNDING SHOWN
IN THE
GRANT-IN-AID
ACCOUNT (FIGURE
5, PAGE 15)
Figure 5
SOURCES OF FUNDING SHOWN IN THE GRANT-IN-AID ACCOUNT FOR
1999-2000
| 1999-2000 |
| 1998-99 |
| £000 | £000
| £000 |
The grant-in-aid from the Department
| | 15,000 | 15,809
|
The Royal Collection Trust: |
| | |
net surplus from paying visitors to the precincts at Windsor Castle
| 2,369 | | 3,416 |
Less | |
| |
Retained by the Trust to repay payments made in advance in earlier years to meet fire restoration costs
| 850 | | 2,331 |
Cost of new visitor centre at Windsor Castle
| 1,091 | | 839 |
Contributions to 1999-2000 fire restoration costs and general maintenance
| | 428 | 246
|
Rents from residential and office accommodation
| | 3931 |
2881 |
Interest | | 137
| 189 |
Note:
1 In addition, employees paid from the grant-in-aid or the Civil
List provided with residential accommodation in the Palaces have
their salaries abated. In 1999-2000 these abatements and charges
amounted to £519,000 (521,000 in 1998-99), representing savings
to the graint-in-aid and the Civil List.
Source: The Royal Household.
GRANT-IN-AID
EXPENDITURE SINCE
1991-92 (FIGURE 7, PAGE
17)
Figure 7
GRANT-IN-AID EXPENDITURE SINCE 1991-92
From 1991-92 to 1999-2000 the grant-in-aid has fallen from
£29 million to £14.6 million in real terms (1998-99
prices). Exceptional expenditure from the grant-in-aid on the
restoration of Windsor Castle is shown separately. In addition,
almost £28 million of expenditure on the Windsor Castle restoration
was funded from income collected from visitors to Buckingham Palace
and Windsor Castle.
Expenditure has been adjusted to 1998-99 prices using the
GDP deflator. This retains consistency with the data shown in
Comptroller and Auditor General's Report. As a result the 1999-2000
figure shown is £14.6 million, slightly below the cash figure
of £15 million (Figure 2). The Royal Household does not use
the GDP deflator but publishes real terms data using indices specific
to those types of expenditure on which the grant-in-aid is incurred.
EXPENDITURE ON
MAINTENANCE PROJECTS
SINCE 1991-92 (FIGURE
8, PAGE 18)
Figure 8
EXPENDITURE ON MAINTENANCE PROJECTS SINCE 1991-92
In real terms (1998-99 prices) expenditure on property maintenance
has fallen to 35 per cent of the amount spent in 1991-92, when
the Royal Household took over management of property services.
The figures for maintenance projects shown above exclude the cost
of the Windsor Castle restoration to allow year-on-year comparisons
of maintenance costs.
Expenditure has been adjusted to 1998-99 prices using the
GDP deflator. This retains consistency with the data shown in
the Comptroller and Auditor General's Report. As a result the
1999-2000 figure of £6.6 million is slightly below the cash
figure of £6.8 million (Figure 2). The Royal Household does
not use the GDP deflator but publishes real terms data using indices
specific to those of expenditure on which the grant-in-aid is
incurred.
MAINTENANCE PROJECT
EXPENDITURE AGAINST
BUDGET (FIGURE
9, PAGE 19)
Figure 9
MAINTENANCE PROJECT EXPENDITURE AGAINST BUDGET, 1996-97
to 1999-2000
In each of the years 1996-97 to 1998-99 the costs of major
property maintenance were between 2.0 and 4.8 per cent in excess
of budgets, as a result of achieving savings in other areas. In
1999-2000 expenditure was six per cent under budget.
THE ROYAL HOUSEHOLD'S PERFORMANCE AGAINST THEIR PROJECT COST TARGETS (FIGURE 10, PAGE 20)
|
|
Figure 10
THE ROYAL HOUSEHOLD'S PERFORMANCE AGAINST THEIR PROJECT COST TARGETS
|
|
THE TARGET
WAS MET
OR EXCEEDED
IN MOST
CASES.
| 1994-95 | 1995-96
| 1996-97 | 1997-98
| 1998-99 | 1999-2000
|
Projects with a construction cost of £25,000 or more with a cost overrun of no more than:
| | | |
| | |
70 per cent of projects to be completed within 5 per cent of the let tender amount
| No
(69 per cent) | Yes
(75 per cent)
| Yes
(77 per cent) | Yes
(95 per cent)
| Yes
(74 per cent) | Yes
(82 per cent)
|
100 per cent of projects to be completed within the greater of £20,000 and 10 per cent of the let tender amount
| Yes | Yes | No
(97 per cent)
| No
(95 per cent) | Yes |
Yes |
Source: The Royal Household.
PROGRESS OF
INDIVIDUAL PROJECTS
(PARAGRAPH 3.17 AND
APPENDIX 3, PAGE
34)
4. Of the two projects examined by the National Audit
Office which were still ongoing at 31 March 1999, one has since
been completed.
Project 6
Repairs to the external fabric of St James's Palace
| The project was completed on time for a total cost of £591,000.
This was 6 per cent below the tender cost.
|
Comptroller and Auditor General
13 December 2000
| |
1
The net income from salary abatements and charges for employees,
and rental payments from other occupants of self-contained residential
accommodation, was £213,000 (£630,000 in 1998-99) offsetting
some of these costs. Net income was lower in 1999-2000 principally
because several apartments which have become available for commercial
letting were refurbished, and the refurbishment costs were charged
against rental income. Commercial rents will increase substantially
in 2000-01 as a result. (Source: The Royal Household, Grant-in-aid
annual report 1999-2000). Back
|