The Occupied Royal Palaces Estate (the Estate), which includes Buckingham Palace and Windsor Castle, is held in Trust for the Nation and used to support the official duties of The Sovereign. The Department for Culture, Media and Sport (the Department) is accountable to Parliament for the upkeep of the Estate, but has delegated day to day responsibility to the Royal Household (the Household). The Department gives the Household an annual grant to maintain and run the Palaces, which has remained at around £15 million since 2000-01 (a 19% real terms reduction). An increase in running costs over the same period means there has been a 27% fall in maintenance expenditure to £11.1 million in 2007-08.
The Department has set the Household an objective which focuses on the condition of the Estate, but none of the key indicators measures performance against it, and the Household does not have a comprehensive analysis of the condition of the Estate. In addition, despite our warning in 2001, the Household has reported that a £32 million maintenance backlog has built up. As a result, important work such as the repairs to the Victoria and Albert Mausoleum has been deferred. The Department and the Household have yet to agree criteria for assessing the backlog and develop a plan for managing it. In addition, the Household does not have a strategy for managing its Estate.
The Royal Collection Trust (the Trust) is responsible for the works of art held in Trust for the Nation, but is not accountable to Parliament. The Trust manages visitor admission to the Palaces and receives the income generated, which in 2007-08 totalled £28 million. The Trust shares some of the Windsor Castle income with the Household (£1.8 million in 2007-08), and, eight years after we first recommended it, the Trust plans to share income from visitors to Buckingham Palace with the Household from April 2009. In contrast to Windsor Castle, which is open to the public virtually all year, Buckingham Palace is open for 63 days because of the number of official engagements and the costs involved. Other buildings such as the White House and Houses of Parliament manage to open for most of the year, despite similar obligations and security concerns.
The Household uses the Estate to accommodate some members of the Royal Family, 139 current and 32 former staff, and has 36 properties available to let. Since 2001, the Household has increased the rent received from £418,000 to £1 million. In the absence of a strategy the Household assesses the suitability of properties to let on a case by case basis. Despite our recommendations eight years ago, the Household has only moved one member of staff to within the secure perimeter, although there are 28 vacant properties within it.
On the basis of a report by the Comptroller and Auditor General, we took evidence from the Department and the Household. In addition, we visited Buckingham Palace, Clarence House, St James's Palace and Windsor Castle to see a selection of the Household's maintenance projects.