2.37 pm

Paul Flynn (Newport West) (Lab): May I raise an issue in support of the points that many people have made about the role of the monarchy outside the well-known ceremonial role—the crucial role of Head of State? This matter gets little or no attention. The Conservative historian, Robert Rhodes James, a former colleague of ours, gave a lecture in Cambridge, which was largely ignored, about a time when the role of the monarchy might have been absolutely crucial in our history. It was at the time when the skids were under Margaret Thatcher and everyone wanted her to go and tearful members of the Cabinet were coming to No. 10 Downing Street asking her to go. Robert Rhodes James, who was a very distinguished and respected Member of the House at that time, said that the Conservative party suddenly became terrified because there was a possibility that Mrs Thatcher might call a general election and she could not have been stopped by the Conservative party, the Cabinet or the House of Commons.

Mr Deputy Speaker (Mr Lindsay Hoyle): Order. We are talking about the allocation of time. I know that history is part of time but I am not sure it is relevant to the Bill.

Paul Flynn: This point is crucial to why we need extra time. This issue is virtually unknown, but it is important because the only person who could then have stopped Margaret Thatcher from acting in her own interests rather than in the national interests, as she might well have been elected, was the Queen. This is a question about the personality of the monarch, because the strong personality of the monarch might have been vital then. This matter is so important that we should have a greater allocation of time and a full debate.

2.38 pm

Mr Denis MacShane (Rotherham) (Lab): It is a serious point that we are rushing through today a fundamental change. Reference has been made to 1760, so we are proposing in two hours, if that, to change what has been in place for more than 200 years. There has been virtually no publicity in the press. For obvious reasons, we have been dominated in the House and in the public sphere by other events since the Chancellor and the shadow Chancellor first spoke on this issue and since the Bill was read the First time two weeks ago. At that time, of course, none of us would have imagined what would be the only story dominating the press.

This is profoundly important. My right hon. Friend the Member for Leicester East (Keith Vaz), who is the

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Chair of the Home Affairs Committee, has made his significant points; there are others. The one that most concerns me is that if passed—I have questions about the level of financial support—there can never be any change, because the provisions will not be debated in the same way as the civil list is debated each time the monarch changes.

We are setting in perpetuity a system for paying the royal family that cannot be challenged thereafter. Even George III would have baulked at that—[ Interruption ]— even though some Conservative colleagues from a sedentary position seem to think that it is a good idea. Therefore, should we not put this off? Festina lente. We do not need to rush this through today. We could return to the Bill in the autumn. We could then have a proper debate and proper public discussion, and deal with it properly.

2.40 pm

Ian Paisley (North Antrim) (DUP): Members want to go back to 1700 and something. I am happy to go back to 1690. [ Interruption. ] Given the week that we are in, we are close enough. At home, we often say, “We won the battle, but they kept the river.” In this instance, I am happy to support the Government and go with the proposal.

2.41 pm

Jacob Rees-Mogg (North East Somerset) (Con): I am—

Chris Ruane (Vale of Clwyd) (Lab): Going back to 1066.

Jacob Rees-Mogg: I am not going to go back to 1066, but I am not sure whether it was auspicious to schedule the debate for Bastille day. Debating the monarchy today of all days might not have been wise, but to limit the debate so much is not necessarily as constitutional as it ought to be, and perhaps Her Majesty’s Government might like to bring the Bill back, as the right hon. Member for Rotherham (Mr MacShane) suggested, when we can have a little bit of time for a proper debate on Second Reading.

Question put and agreed to.

Sovereign Grant Bill

2.42 pm

Question put forthwith (Order, this day),That the Bill be now read a Second time.

Question agreed to.

Bill accordingly read a Second time.

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Sovereign Grant Bill

Considered in Committee

(Order, this day)

[Mr Lindsay Hoyle in the Chair]

The Chairman of Ways and Means (Mr Lindsay Hoyle): The Committee will have seen from the provisional selection list that I have selected a number of manuscript amendments tabled by the Minister this morning. I would not as a rule select such manuscript amendments without good reason. I can see no reason why they were not tabled in the proper time, but in the unusual circumstances of the Bill, I am prepared to select them.

Clause 1

The Sovereign Grant

2.43 pm

The Chancellor of the Exchequer (Mr George Osborne): I beg to move, That the clause stand part of the Bill.

I concede that we are engaged in a rather unusual procedure. To have what I hope will amount to a Second Reading debate, we will debate clause 1 stand part. Clause 1 will create a sovereign support grant and so, in effect, it lies at the heart of the Bill. I completely respect and understand what has just been said by hon. Members on both sides of the House. I would point out that we had something akin to a debate on Second Reading a couple of weeks ago, when we debated the principle for several hours. I freely concede that we did not have the Bill in front of us.

I was following the procedure established over many decades, and I worked with the Clerks and, indeed, through the usual channels to try to create something akin to a debate on Second Reading a couple of weeks ago. Our intention was to debate the Bill in Committee and on Report on the Floor of the House, because it is a constitutional Bill. In effect, the House of Commons will have two days on the Floor of the House to debate the legislation, but I am the first to accept that we have adopted a rather archaic procedure. I am glad that we used a bit of modern innovation to allow this debate to take place under clause 1 stand part.

2.45 pm

Mr David Winnick (Walsall North) (Lab): Obviously, I have listened to what the Chancellor said, but will he bear in mind that we did precisely the same thing last Thursday, on a subject that is not his responsibility? It is all the more irritating that on two successive Thursdays we have had this situation in the House.

Mr Osborne: I cannot speak on what happened last week, but I would just draw the hon. Gentleman’s attention to this distinction: two weeks ago, on the Floor of the House, we had something like a Second Reading debate about the principles of the Bill. In the comprehensive spending review statement last October, I set out how we proposed to proceed on the subject; that was quite well known. There is not a great deal of surprise about the idea in the Bill of a sovereign grant, linked to the revenues of the Crown Estate and so on. As I say, I accept that the procedure is rather unusual, but the effect is that the House had something akin to a

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Second Reading debate a couple of weeks ago, and we will use the debate on clause 1 to have something akin to a Second Reading today, too. I hope to address all the issues that people raised two weeks ago in my response on clause 1. Of course, we will have time later today to go through other parts of the Bill.

Paul Flynn (Newport West) (Lab): A fortnight ago, the House was exceptionally thinly attended, even for a Thursday. Will the Chancellor tell the House when Back Benchers were informed that the Bill was coming before the House?

Mr Osborne: The problem that Parliament had was that under the procedures of the House, we had to receive a gracious message from Her Majesty the day before. I do not expect the hon. Gentleman to agree with the procedure, given his broader views on the monarchy, but we had to wait for that gracious message before making it publicly known that we would have a debate in the House. That is what happened. I spoke to the official Opposition, and the Prime Minister spoke to the Leader of the Opposition a week earlier, but I accept that the debate was not as fully attended as it might have been. However, we did spend a couple of hours discussing the matter a couple of weeks ago, and there were quite a number of speeches made, so even though the debate was not as fully attended as, for example, yesterday’s proceedings in Parliament, attendance was not that dissimilar to attendance today. Of course, there has been lots of notice of today’s debate.

Paul Flynn rose—

Mr Osborne: I will give way, and then I should probably make some progress on clause 1 stand part.

Paul Flynn: I do not think it is fair to blame the monarch for the way in which the measures were rushed into the House. Normally, if there is a change to business, a business statement is made to the House as early as possible; I cannot remember one being made at all in this case. Most hon. Members had other pressing business on that day, and only those who were here in the morning had any idea that the measures were going ahead.

The Chairman of Ways and Means (Mr Lindsay Hoyle): Order. I have sympathy for the hon. Gentleman, but we have just decided on the process that we are following; we now have to stick with where we are.

Mr Osborne: All I would say is that I have followed the advice of the House authorities throughout. The procedure has been unusual. People have said that this is the most important change since 1760, but of course in the early 1970s the House made some significant changes, so we are partly following procedures laid down then.

Let me get on to the substance of the Bill. Everyone has now had a chance to read it. Amendments have been tabled by Opposition Back Benchers, Opposition Front Benchers, and Government Front Benchers, and I shall say something about that. We have basically accepted some of the amendments that the shadow Chancellor and his team tabled, and I will explain why later.

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I will begin, as we should do on such occasions, by putting on the record the House’s gratitude for the service that the Queen has provided to our country over many decades. Indeed, her time on the throne recently exceeded that of George III and she now has Queen Victoria in her sights. The recent visit by the Duke and Duchess of Cambridge to Canada and California reminded us that other members of the royal family also make an enormous contribution. As I said a couple of weeks ago—it is a view shared by nearly everyone in the House—we want a system that provides the Queen with dignity and allows her and her family to do their official jobs, which in her case is Head of State, but to do so in a way that is accountable, transparent and delivers value for money for the taxpayer.

The current system of financial support has some very serious shortcomings. It is very inflexible, so money saved in one spending area such as travel cannot be spent in another area such as the maintenance of royal palaces. It is not very transparent, as the National Audit Office is not the auditor of royal finances; that is done by the permanent secretary to the Treasury. I pay tribute to my hon. Friend the Member for Gainsborough (Mr Leigh), the former Chair of the Public Accounts Committee, for the work it did in recent years to look at value for money studies on particular areas of royal financing, which has been quite opaque and which this Bill seeks to change. Critically, the current system has relied on a reserve of public money that was built up over the past 20 years and is now depleted. That was a crucial part of the royal household’s annual funding for the continuance of their official duties. That money has run out, so in other words the system is broken and we have to fix it.

Mr Kevan Jones (North Durham) (Lab): Does the right hon. Gentleman agree that if we are to have true transparency in the costs of the royal household, we need to know about all expenditure, including, as I suggested a couple of weeks ago, the contribution made to the household by the Ministry of Defence in terms of staff? We learnt last week from The Mail on Sundaythat Prince Charles has apparently objected to the full costs of the royal flight being put on the royal household, which effectively means that the MOD is subsidising the household. If we are to get the true costs, do we not need full transparency on everything paid to the royal household?

Mr Osborne: I will move on shortly to some of the issues that the hon. Gentleman raised two weeks ago on the use of accommodation on the royal estate, for example by the MOD, and say something on that and other areas of royal spending. The Bill establishes a distinction between the royal family’s public expenditure and their private finances. It is a long-established principle of the system that their private finances, for example from the Duchies of Lancaster and Cornwall, are their private money. There are checks and balances on that, such as the Chancellor of the Duchy of Lancaster having to be a member of the Government. We are saying that all the royal family’s public expenditure, which goes to their official duties and those parts of the royal estate that are not part of their private income or assets, should all now be auditable by the National

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Audit Office and that the Public Accounts Committee should be able to look at it. That is a fairly dramatic increase in the transparency before Parliament.

Mr Kevan Jones rose

Mr Ian Davidson (Glasgow South West) (Lab/Co-op) rose

Mr Osborne: Let me just answer this point before giving way again.

Although I do not want to speak for the Comptroller and Auditor General or the PAC, I suspect that if they wanted to look at the funding arrangements between the MOD and the royal family, they would be able to do so under the provisions of this Bill.

Mr Jones: A couple of weeks ago I welcomed the increased transparency in the auditing process that the proposals bring forward, but if we are to determine the size of the sovereign grant—it is £30-odd million a year—surely a good starting point would be to find out what the actual cost of the royals doing their public duties is. I accept that some of the things the Ministry of Defence does are directly linked to the royals’ public duties and I do not suggest for one minute that the royal household should subsidise that, but surely to determine the size of the sovereign grant we need a better understanding of all costs coming from the public purse, whether from the Ministry of Defence or any other Government Department.

Mr Osborne: Let me give way to the hon. Member for Glasgow South West (Mr Davidson) and then I will answer both hon. Gentlemen’s points.

Mr Davidson: The Chancellor mentioned his view that income from the Duchy of Cornwall and the Duchy of Lancaster is private money of the royal family. Surely he recognises that in the previous Parliament the Public Accounts Committee established quite clearly that that is not the case—that this is not the private property of the monarch or her family but a trust established by the nation in order to fund the various members of the royal family. That is different from saying that it is the private property of the royal family themselves.

Mr Osborne: I should make it clear that it is an established principle that the income from that property, which is held in trust, is for the private purposes of the royal family.

In response to the hon. Member for North Durham (Mr Jones), I point out that there are of course some areas of royal financing—I will come on to say something about royal protection—where it is very difficult to be public about some of the sums of money involved. The Bill—I hope that we will soon get into the meat of it—is a mechanism for helping to continue the current level of spending. As I say, it is perfectly within the rights of the National Audit Office and the Public Accounts Committee, if they want to, to look at payments from the Ministry of Defence, but that has to be a matter for them.

Matthew Hancock (West Suffolk) (Con): As the most senior member of the Public Accounts Committee in the Chamber—because I am the only one here—I think

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that I speak for everybody on that Committee when I say that we welcome the additional transparency and very much look forward to bringing the royal household before it to answer the questions that have rightly been raised across the Chamber.

Mr Osborne: I thank my hon. Friend. When the Chair of the PAC, the right hon. Member for Barking (Margaret Hodge), spoke in the debate two weeks ago, she was very generous in her tribute and made it pretty clear that the PAC would be getting to work on its job. I served on the PAC, as its most junior member, with the hon. Member for Glasgow South West, and I remember us making an interesting visit to Kensington palace to investigate royal finances. For some years, therefore, the PAC has been establishing a reputation for examining the books in this area.

Paul Flynn rose

Mr Kevan Jones rose

Mr Osborne: I would like to make a little progress, if both hon. Gentlemen will allow me. Let me say a little more about the Bill, and then I will be happy to take questions.

Clause 1 proposes the creation a sovereign grant designed around three principles. First, it is sustainable, so that it provides reliable, long-term financing for the sovereign that is free from annual political argument but gives the House of Commons proper checks and controls. Secondly, it is flexible in dealing with the problem I described whereby money saved on travel cannot be spent on palace maintenance and vice versa. Thirdly, it is accountable, as I have been saying, because of the historic increase in parliamentary scrutiny of royal expenditure.

The Queen is one of the few Heads of State in the world who is genuinely completely above the party political fray. I want to take this opportunity to thank my opposite number, the shadow Chancellor, and his team for conducting themselves in a very proper way as the loyal Opposition in asking questions. We will come on to the questions that he has rightly asked. [ Interruption. ] I suggest that his Parliamentary Private Secretary, the hon. Member for Vale of Clwyd (Chris Ruane), banks this moment, because it might not come again in this Parliament. We have tried to be as open as possible. I know that members of the shadow Chancellor’s team met the Treasury officials on the Bill team yesterday. As I will explain, I propose to accept a couple of his amendments.

The shadow Chancellor asked four questions in the debate two weeks ago. I propose, for the rest of my remarks, to answer those four questions. It will be up to him and the House to decide whether they are adequate answers, but I thought that that was the best way to approach this matter. His first question was about the level of the sovereign grant, the second was about the mechanism for uprating it, the third was about the new arrangements for greater parliamentary scrutiny, and the fourth, which relates to some of the interventions we have just heard, was about the way in which the Government provide other forms of support to the royal family. I will take each question in turn.

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3 pm

On the level of the sovereign grant, as we discussed two weeks ago, for many centuries the Government of the day have used taxpayers’ money to fund the official duties of the monarch. In return for that financial support, every King and Queen since George III in 1760 has agreed to surrender for their lifetime the full income of the Crown Estate to the Government. Nothing in the Bill changes that. The Crown Estate’s profits will continue to flow into the Exchequer, as they have done for the past 250 years, and we will continue to use them for general public expenditure. The funding for the monarch will continue to be provided by the taxpayer out of the money voted in the estimates.

Our approach is new in the sense that we are choosing a new reference point for the calculation of the support that we give the sovereign. We propose that the Queen should receive a grant equivalent to 15% of the profits made by the Crown Estate in the financial year two years earlier. To put it another way, the sovereign grant in 2013-14, which is the first year in which the mechanism will operate, will be equivalent to 15% of the Crown Estate’s profits in 2011-12. Why do it in that way? We could of course have chosen some other measure. We chose this mechanism partly because it establishes the historical connection between the Crown Estate and financial support for the monarch. The real reason was that we were looking for a mechanism that was broadly in line with the economy and that would be more permanent.

One important change in the Bill, which was referred to in the debate on the time resolution, is that we will no longer require Parliaments—I hope future Parliaments—to pass primary legislation within six months of the arrival on the throne of a new monarch, which is the case under the civil list arrangements. We are trying to establish arrangements that are not to do with the current personality of the monarch, but that endure beyond that and allow the royal household to plan for the future with certainty.

Jacob Rees-Mogg (North East Somerset) (Con): Will my right hon. Friend confirm that in the theoretical circumstance that a new monarch decided to keep the Crown Estate revenues, it would be open to such a monarch to do so?

Mr Osborne: I think that that is pretty unlikely and pretty theoretical, to be honest. Since 1760, it has been an established precedent that the monarch hands over the revenues of the Crown Estate to the Government of the day. There are many powers that we vest in our monarch. The Queen has wisely, like her predecessors, chosen not to use those powers. As I say, I think that that question is pretty theoretical.

Paul Flynn: In the debate two weeks ago, the Member who represents the middle ages, the hon. Member for North East Somerset (Jacob Rees-Mogg), suggested that the Queen paid income tax at a higher rate than any other citizen. Will the new arrangements be so transparent that we know the precise rate of tax the monarch pays and whether the monarch gets the expected windfall of revenue from wind and tidal generation in their 15%? If that revenue becomes excessive, will it be curtailed to a suitable level?

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Mr Osborne: I will deal in my remarks with that specific point about what will happen if the revenues of the Crown Estate suddenly grow beyond people’s expectations, or even in line with the expectations of those who think that there will be a windfall from the marine estate.

Tristram Hunt (Stoke-on-Trent Central) (Lab): The guidance to the Bill suggests:

“The Crown Estate is not the sovereign’s private property”.

However, we know that in 1760, as the guidance states, George III

“surrendered these revenues (but not ownership of the capital assets)”.

Where do we stand on the clarity of ownership?

Mr Osborne: It is understood that there are certain pieces of property, such as Buckingham palace, Windsor castle and the Crown Estate, that belong to the institution of the monarchy, and certain pieces of property and assets that are the private property and assets of the Windsor family. That is a well-established precedent and has been recognised by the House for many decades. Nothing in the Bill changes that.

Mr Davidson: Will the Chancellor of the Exchequer give way on that point?

Mr Osborne: I will give way on that point and then make some progress on clause 1.

Mr Davidson: I am very grateful. The Chancellor is undoubtedly correct that some pieces of property are tied in with the institution of the monarchy, such as Buckingham palace, but the coastline of Scotland and the undersea surface are not intimately connected with the monarchy and have never, as far as I am aware, been visited by the monarchy. In those circumstances, I am not clear why the two categories are being conflated. Surely it would be better, if the Chancellor wants a method that is tied to growth in the economy, if it were simply tied to, say, gross domestic product. If GDP went down the Queen and the monarchy would suffer the same as the rest of us, and if it went up, they would benefit in line with the rest of us. That would be better than tying the fund to a measure that I envisage will make it grow at a far greater rate than the economy as a whole.

Mr Osborne: First, I do not want to speak for the Queen, but I think she is quite familiar with the Scottish coastline.

Chris Ruane (Vale of Clwyd) (Lab): Underwater?

Mr Osborne: Let us try to keep focused on the issue at hand.

Secondly, I completely accept that I could have brought other mechanisms before the House, but the Crown Estate is a large commercial property company that is run in a pretty conservative way. It is not a bad proxy for how the country and the economy are doing. That is why we are proposing this mechanism, but of course if people want to propose something else they are entitled to do so.

Mr Kevan Jones: Will the Chancellor give way?

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Mr Osborne: May I make some progress before taking a few further interventions?

I should just mention, although the change to the Duchy of Cornwall is in a later clause, that as I explained to the House a couple of weeks ago, all Dukes of Cornwall are heirs to the throne, but not all heirs to the throne are Dukes of Cornwall. As a result, there is potential for there to be an heir to the throne who was not the Duke of Cornwall, because the Duke of Cornwall can only be the eldest son of the monarch. The heir to the throne could be either a daughter, granddaughter or grandson of the monarch, and they would not have access to the duchy’s income. The Bill proposes a change to that, but does not propose to change the Act of Settlement.

Keith Vaz (Leicester East) (Lab) rose

Mr Osborne: I suspect that the Chairman of the Home Affairs Committee wants to intervene on that point.

Keith Vaz: I feel very guilty that the Chancellor has been speaking for so long and, because of all the interventions, is only on clause 1. I will not detain him for long, but I thank him for giving way. Will he update the House during the course of his speech, if he ever gets to complete it, on the negotiations that have been conducted by the Deputy Prime Minister with the Prime Ministers of 17 other Commonwealth countries, and let us know whether there has been any progress on the matter?

Mr Osborne: I think I will leave it to the Deputy Prime Minister to update the House on that. It is one of the many benefits that come from being Deputy Prime Minister that he gets to conduct these important negotiations. [Interruption.] They are extremely important negotiations. The right hon. Member for Leicester East (Keith Vaz) makes a good point in reminding the House that this question involves a lot of other countries. That explains why something that people assume would be quite simple to deal with in the House of Commons is not.

Let me talk about the actual numbers. How much is 15% of the Crown Estate profit, and how does it compare with what the royal family has spent in recent years on its official duties? In 2006, they spent £33 million; in 2007-08, they spent £35 million; and then £37 million and £34 million. The latest annual accounts, which were last week, showed that they spent £32 million. The amount varies a bit, because one-off capital projects are either undertaken or not in given years, but the average of the past five years is £34 million. It is interesting to note that it was £49 million 20 years ago, so the latest figure shows quite a dramatic reduction compared with what they used to spend. In real terms, the reduction is more than 50%.

Mr Kevan Jones: That is very interesting, but if we do not know which Government Departments are subsidising the royal household, how can we tell whether those efficiencies are real ones? I suspect that in some cases, Departments are cross-subsidising them. At the moment, the grant in aid for certain palaces comes from, for example, the Department for Culture, Media and Sport.

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I know that in 1999, Marlborough house was included as part of that. Will there be limitations on what other royal properties can be added so that the sovereign grant can be spent on them?

Mr Osborne: I will get back to the hon. Gentleman specifically on that point—I do not have specific information on Marlborough house with me at the moment—but on his broader point, for the first time, we will allow the National Audit Office to crawl over the arrangements that he describes.

I was going to go on to explain that some senior members of the Ministry of Defence and our military live in properties that are rented from the Crown Estate at below the market rate. The properties are within extremely secure zones, and it would not be possible to rent them to virtually anyone else. That arrangement suits the MOD, because it gets properties—not very many—at below the market rate, and equally, it suits the royal estates, in that they can rent out properties that they would not be able to rent out otherwise.

Let me talk about those sums. As I have pointed out, the average over the past five years is £34 million, which is much less than 20 years ago, when it was £49 million. In 2013-14—the first year in which the new sovereign grant mechanism will apply—the level will be determined by the profits in 2011-12, as I said earlier. We do not know precisely what those profits will be, because we are in the middle of the financial year, but the recently published Crown Estate annual report for last year showed profits of £231 million, and the Crown Estate confirms that that is pretty much what it is expecting in profits for 2011-12. The result of all that—this is the key point for the House—is that the sovereign grant in 2013-14 would be £34 million, which is in line with the average for the past five years. I would not say that that is a coincidence, because we have partly designed the mechanism to ensure that that has happened.

If projections for the Crown Estate are correct over the rest of this Parliament, we should see a real-terms cut of up to 9% in the funding for the official duties of the sovereign in that period.

Mr Davidson: The Chancellor will be aware, from discussions on the Scotland Bill, of a proposal for part of the Crown Estate to be devolved to the Scottish Parliament in Edinburgh, or handed to local authorities, community groups and so on. What would happen to the Crown Estate and the money going to the royalty if that proposal were passed?

Mr Osborne: That is not something that the Government are proposing today. If we were to propose it, we would of course address the impact of such a decision on the royal finances. I am assuming that even under such arrangements, the Queen would remain the Queen of Scots. I believe that most of us are happy with the current arrangements.

Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP): Will the Chancellor give way?

Mr Osborne: I will give way, but then I really must make more progress.

Mr MacNeil: Will the money from the Crown Estate be paid directly to the royal family or will it go to a third party?

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3.15 pm

Mr Osborne: The money is not paid directly. It comes into the Exchequer, like other revenues, and is then paid out to the royal family. It is paid out of general public funds through estimates voted by Parliament. The only link is that we have a formula for how much we give the royal family. However, there is no direct transfer of money from the Crown Estate to the royal family.

Paul Flynn rose

Mr Osborne: If the hon. Gentleman will allow me, I will make some progress.

I hope that I have answered the shadow Chancellor’s first question about the level of funds. In the end, it is a matter of judgment whether £34 million or so is the right amount for the future. The newspapers’ reaction to my statement a couple of weeks ago was not much of a guide. The Independent headline read, “Queen guaranteed £35m ‘recession-proof’ income”, while The Daily Telegraph wrote, “Monarchy ‘shorn of its dignity’ to save money”. I think we probably got it about right somewhere in between the two.

That leads to the second and probably most important question that the shadow Chancellor asked: how can we ensure that the sovereign grant is neither too high nor too low, and what can we do about it if it is judged to be either? Basically, the Bill introduces a number of important safeguards. First, it provides for a reserve fund so that any unspent surplus from the sovereign grant that year will go into a reserve fund. Under the civil list, there has always been a reserve fund. Indeed, it reached £37 million early last decade. We propose that the reserve fund should be capped so that it does not go above about 50% of the annual grant. In other words, assuming that the grant is likely to be £34 million, the reserve fund would not be allowed to rise above £17 million. However, it is right that the royal household has a reserve to call upon for major capital works that it needs to undertake, although, as I said, we are introducing for the first time a cap on that reserve.

The Bill retains as the three royal trustees the Prime Minister, the Chancellor of the Exchequer and the Keeper of the Privy Purse. It is our responsibility to act in any given year to ensure that the reserve remains within that 50% cap. If it is going to be higher, we can act to reduce the cash going to the royal household through the grant to below 15% of Crown Estate profits. That is one check.

Mr Kevan Jones rose

Mr Osborne: May I set out the checks and then invite questions—I mean interventions? I am not going to make the mistake of some right hon. Members in thinking that interventions are questions.

The second check concerns the in-year controls that the Treasury operates for all public expenditure. The permanent secretary to the Treasury remains the accounting officer for the disbursal of Treasury funds, and the Keeper of the Privy Purse will be the accounting officer for the royal spending we are talking about and can be summoned and asked to give account for that. The hon. Member for Bristol West (Stephen Williams) asked whether Buckingham palace will be able to open for

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longer this year than it did last year. I can confirm that that will be the case, as the palace is looking for additional sources of income.

The key check, however, for ensuring that the level of funds is appropriate and that the 15% amount is being paid will be the review of the 15% mechanism. The legislation requires that a review is carried out seven years after the Bill comes into effect and every seven years thereafter. The shadow Chancellor and his team have suggested some amendments. I have discussed them with him and I am now proposing, through Government manuscript amendments today, basically to accept his amendments. That means that the first review will be carried out four years after the grant comes into effect—he suggested three years, but having discussed it, I have decided on four years—and therefore that the first review will be carried out in 2016. That will be one year after the general election, which is a good and sensible moment for us to review royal finances.

I am also accepting the right hon. Gentleman’s amendment that proposes a five-yearly, instead of seven-yearly, review thereafter. In other words, in every Parliament, assuming that the fixed-term Parliament provisions are adhered to, the review will take place one year after the general election. There will be a review in every Parliament, assuming that they are five-year Parliaments.

Mr Kevan Jones: Will the Chancellor explain how the controls over the reserve will work? Who will take the decisions about how it is spent? It does not take a genius or a financial wizard to work out that, if we draw down the reserve, we can certainly keep up the annual income at 15%. Who will have a say over how the reserve is spent? Will the Government of the day have any control over how it is spent?

Mr Osborne: First, the reserve will be audited by the National Audit Office, as the Bill makes clear. Secondly, the trustees of the royal finances—the Keeper of the Privy Purse, who is the Queen’s appointment, but also the Chancellor and the Prime Minister of the day—have oversight of the reserve. That is similar to the current arrangement. The Chancellor of the Exchequer—who undertakes this work more than the Prime Minister—and the Treasury will ensure that the reserve is used for proper purposes. As I have said, the reserve is also accountable to the National Audit Office and the Comptroller and Auditor General.

Paul Flynn: I have listened carefully to what the Chancellor has said, but I am still baffled as to why a simple mechanism that could be easily understood has not been used, perhaps similar to the one used to change pensions every year. Instead, we are to have a complex system under which, if the Crown Estate does well, royalty will win, and if it does badly, the taxpayer will lose.

Mr Osborne: As I have said, we could have chosen another mechanism, but I thought that it was not unreasonable to take a large, conservatively run property company to determine expenditure by the royal household, given that a lot of its expenditure is on property maintenance and the like. I completely accept that not every Member of the House will agree with that, but the effect, which is surely the important thing, is that the amount of money going from the public purse to the royal family

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will be broadly the same. They were receiving about £34 million on average from the civil list, the palaces grant and the travel grant, plus the money put into the reserves by the taxpayer, and they will go on receiving £34 million. We can have a debate about the mechanism, but the effect will be pretty much to continue through this Parliament with the sums that they were getting during the last one. We are of course talking in cash terms, which will mean about a 9% real cut, coming on top of a more than 15% real cut over the past 20 years.

I know that we are still debating clause 1, but I hope that the Committee will acknowledge that, in accepting the shadow Chancellor’s amendments to clause 7, we have tried to show that we are open to argument and open to trying to work on a cross-party basis. We want to ensure that the Bill proceeds with the consent of those in all parts of the House of Commons.

I want briefly to deal with the shadow Chancellor’s third and fourth questions. He asked about the issue of accountability, and he has tabled amendments proposing annual value-for-money studies. I would much rather leave the discretion with the Comptroller and Auditor General and the Public Accounts Committee. If they want to undertake such studies, they may do so, but I propose to leave that discretion with them. I remind the Committee that we are undertaking a pretty historic transfer of accountability to Parliament here. Parliament has fought for many decades to get scrutiny of the official expenditure of the royal family, and that is now happening through the Bill. Of course, the Public Accounts Committee will be able to ask the Keeper of the Privy Purse, as the accounting officer, to come before it to give evidence.

Let me deal with the fourth question, which was about royal protection. I am afraid that I will not be able to answer the shadow Chancellor’s request here. I have looked into it and made quite a number of inquiries to probe whether it would be possible for me to give the Committee more information about how much is spent on royal security. I have to say that I have run into a metaphorical brick wall in Whitehall, probably for very good reason, which is that it would not be appropriate—this was a view taken by Home Secretaries over many years—to reveal how much was spent on royal security because that might present a security risk. Unfortunately, I am not able to accede to the shadow Chancellor’s request. Let me reassure the Committee, however, that in the process, I have taken a look at the protection arrangements and costs, and I certainly satisfied myself that they are reasonable, proportionate, in line with the current threat assessment and pretty cost-effective. I am fairly confident that the Queen and her family are adequately protected.

I hope that I have answered the various questions asked. My hon. Friend the Member for Gainsborough asked a question about Frogmore, particularly the mausoleum for Queen Victoria and Prince Albert. The royal household has confirmed that it expects to carry out conservation work on the mausoleum over the next five to eight years, so in a few years’ time, my hon. Friend will be able to visit a much restored and improved mausoleum at Frogmore.

Stephen Williams (Bristol West) (LD): Given that the mausoleum is currently on the English Heritage buildings at risk register, will the Chancellor confirm whether what he announced means that it will shortly be removed from that register?

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Mr Osborne: The honest answer is that I have absolutely no idea, but I will find out and let the hon. Gentleman know. I might even be able to find out during this debate.

Mr Kevan Jones rose

Mr Osborne: I give way one final time, but then I shall conclude.

Mr Jones: Has not the Chancellor just confirmed that we are giving the royal household freedom to spend the sovereign’s grant on additional properties? [Interruption.] It is an additional property if the facts are understood. At the moment, the properties covered by grant in aid are Buckingham palace, St James’s palace, Clarence house and Marlborough House Mews, the residency opposite Kensington palace, the Royal Mews royal paddock and Windsor castle and the buildings in the Great park. Are we thus going to see an extension? Who in the royal household makes the decision on that, or does the Chancellor have any say over which other properties not currently covered by the grant in aid from the Department for Culture, Media and Sport can be added in, increasing costs?

Mr Osborne: We do not propose to add anything in. Frogmore is part of the Windsor castle estate, or part of the Windsor Great park, which I am sure the hon. Gentleman knew before he made his intervention.

Let me sum up this rather lengthy clause 1 stand part debate. We do not want a cut-price monarchy; nor do we want an excessively lavish monarchy. What the country wants is a monarchy properly funded to do the job we ask of it. It does that job well. Long may that continue. I commend the clause to the Committee.

Ed Balls (Morley and Outwood) (Lab/Co-op): I commend your patience and flexibility, Mr Hoyle, in allowing this clause stand part debate to include the status of mausoleums and the role of English Heritage, which somewhat stretches the clause. Having a Second Reading-type debate on clause stand part in this way is probably a revolutionary approach to parliamentary procedure. After the events of the last few days, that may not be surprising. However, I should reassure the hon. Member for North East Somerset (Jacob Rees-Mogg) that he need not feel destabilised by my use of the word “revolutionary” in this context.

A fortnight ago, during the debate on the financial motion relating to the Bill, the Opposition made it clear that

“the monarchy continues, and must continue, to play a vital role in the affairs of our nation in the new century, but that to play this role and to command public support, the royal household must… be financed in a proper, open and fair way”.

We expressed our intention to support the Chancellor’s proposals to reform the current 250-year-old arrangements and

“to strike a fair and workable balance between the legitimate needs of the household and the interests of the taxpayer.”

However, we also made clear that it was

“the responsibility of Her Majesty’s Opposition to scrutinise the actions of the Government to make sure that it is done in a fair and proper way”.

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Those are the guiding principles that lie behind today’s debates on clause 1 and, more widely, our amendments.

In that debate a fortnight ago, I cautioned the Chancellor that

“At a time when many families and businesses are under real financial pressure”

there was more work to be done, and a need for more “detail and reassurance” on Second Reading—which we have not had—or in Committee

“to establish a consensus not only across the Dispatch Box but in the country as a whole in support of these reforms.”—[Official Report, 30 June 2011; Vol. 530, c. 1150.]

I also asked the Chancellor to provide more clarity and detail on the level of the sovereign grant and the wider costs of the royal household, the arrangements for regular parliamentary scrutiny, and the mechanisms for uprating the grant.

I thank the Chancellor for the detailed way in which he has sought to answer those questions in the debate so far, and for the serious consideration that he has given to our amendments. I am also grateful to him for giving Members more information than they were given two weeks ago. However, it is difficult to hold a debate such as this when time is so constricted, and I share the concern expressed about that by Members on both sides of the House. As I said to the Chancellor earlier, I think that he could have provided even more information to help Members to understand the debate.

3.30 pm

Setting the sovereign grant at 15% of Crown revenues will mean, from next year until the end of the current Parliament, a 3.2% real-terms rise in the grant available to the royal household. That is significant, and is set against a real-terms fall over the Parliament as a whole.

Let me turn to the thinking behind our amendments, and respond to the points made by the Chancellor. It is right that Parliament and the National Audit Office should be properly able to scrutinise whether the Chancellor is setting the sovereign grant at the right level, given both the costs and the pressures on the royal household. On one hand, the Queen has managed to deliver a 50% reduction in the total expenditure of the royal household over the past two decades, but these proposals, and the cash floor, effectively mean that the process of making further efficiency savings has effectively come to an end.

Mr Kevan Jones: I hear what my right hon. Friend says, but unless we know the full amount of money that is being paid to the royal household by other Departments—for instance, the Ministry of Defence—how can we determine, first, that those efficiencies are real and this is not just about moving money across and, secondly, that 15% is the right level?

Ed Balls: I shall deal with that point in a minute.

Dr Andrew Murrison (South West Wiltshire) (Con): Does the right hon. Gentleman agree that if those costs are indeed taken into account the reduction between 1991-92 and the present day becomes even greater? The figures do not include, for instance, the royal yacht, which has been decommissioned and is no longer a burden on the Ministry of Defence.

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Ed Balls: What concerns me is not the fall in expenditure over the past 10 or 20 years, which most people would consider sensible—notwithstanding the issues raised by my hon. Friend the Member for North Durham (Mr Jones)—but the fact that we are set to see real-terms rises in the years ahead. That is where we should focus our scrutiny.

On the other hand—on the side of the ledger that does not feature efficiency savings—we are seeing rising pressures on the royal family. As I said a couple of weeks ago, the combination of the success of the wonderful royal wedding and the visit of the Duke and Duchess of Cambridge to Canada and the USA, following Her Majesty’s historic visit to Ireland, has resulted in a rise in both the popularity of the royal family and the demands on them around the world, and that trend is set to continue. It is important that we scrutinise whether the resources that are in place are sufficient and right.

I raised in the last debate the fact that it has been reported that a number of members of the royal family have had their security reduced or removed over the past year. I accept the Chancellor’s assurances that there are no concerns in that regard, but it was right that we raised the issue. We have tabled amendments to clauses 2 and 4 that are designed to ensure both that there would be full and independent scrutiny of all the different aspects of royal expenditure, including the level of the grant and, more widely, value for money and the effective spending of resources across the piece, and that the National Audit Office would have sufficient powers and resources to do that job. My hon. Friend the Member for North Durham asked about wider expenditure outside the sovereign grant. As I understand it, it should now properly come within the purview of the NAO to look across the piece. In our upcoming debate on those clauses, perhaps we could receive an assurance that the NAO will be able to look at all the budgets, not just this particular one. Clearly, the NAO will not be able to reach a judgment on value for money in terms of royal household expenditure under this grant unless it can do so in the context of the other expenditures by Government Departments for the royal household. It is important to maintain royal protection and security, but protecting value for money is also important. The NAO and the Public Accounts Committee will need to respond to the issue my hon. Friend has raised and make sure they can see the full picture. I say again that we seek assurances in the upcoming debate on those clauses that the NAO will be able to look right across the royal household’s expenditures, rather than only at the expenditure financed by the sovereign grant.

The Chancellor has moved very much in our direction on our second issue. I argued a couple of weeks ago that, given the historic importance of these reforms and the inevitable uncertainties at the beginning of a new financing regime, Parliament would need to keep a closer eye on the arrangements. I also said that that needed to be consistent with the Chancellor’s proper desire to give the royal household stability and certainty. In our judgment, waiting seven years for a review, and certainly seven years for the first review, was too long. In our amendments to clause 7, we propose that the first review should happen in the period up to April 2015—three years from now—with five-yearly reviews after that. The Chancellor has gone pretty much to where we would like to be on these matters. Therefore,

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we thank him for taking our concerns seriously and making sure Parliament will be able to take an early view on these arrangements.

On our third issue, however, I have a continuing concern, which has prompted our amendment 8 to clause 7. The issue is the level of profits from the Crown Estate. The Chancellor has told the House that

“we need a funding mechanism that prevents the sovereign coming to Parliament each year for resources, and that provides funding broadly in line with the growth of the economy…There will be a cash floor to protect the monarch from cash cuts, but basically the monarch will do as well as the economy is doing.”—[Official Report, 30 June 2011; Vol. 530, c. 1146.]

We do not know that the figure of 15% of Crown revenues will prove to rise in line with the overall performance of the economy. That obviously depends on the performance of the Crown Estate and Crown revenues. As I pointed out, the Crown Estate income from renewables grew by 44% in the year 2009-10, and it is widely expected to increase again in future years because of the financial potential of the exploitation of wind and tidal energy on the foreshore around the country.

The Crown Estate’s annual report describes current growth as “exponential” and growth over the next 10 years as “significant”. Given the potentially significant changes in income from renewables and, perhaps, wider sources, as well as the prospect that this could lead to an unintended rise in either reserves or, as described in the Bill, simply the overall level of expenditure, it is important that the proposals are robust in meeting significant unintended rises in revenues.

Some have called for a cap on the overall level of the sovereign grant. Instead, we have tabled amendment 8, which would require the trustees to review the arrangements if the Crown Estate’s income were to rise faster in the previous financial year than the underlying trend growth rate of the economy. I think that the public would expect the trustees to review matters immediately if revenues were to rise much faster than had been expected. I also think that the amendment is fully consistent not only with the spirit of the Chancellor’s reforms, but with their detailed intention, as he set out in his spending review speech. Therefore, I ask him to look at the issue again over the next hour and a half. Our proposal is fully consistent with protecting stability for the monarchy and the proper role of Parliament in scrutinising the arrangements. In order to ensure that his reforms are implemented as he intended, we should agree to the amendment.

Paul Flynn: As I understand it, the royal trustees are the Prime Minister, the Chancellor and the Keeper of the Privy Purse. Does my right hon. Friend not think that we would get a more balanced decision if Members of this House were represented among the trustees? They would give a much better opinion than the establishment one on this issue.

Ed Balls: It is obviously nostalgic for me to be back in Committee debating with the Chancellor of the Exchequer across the Dispatch Box, although I would remind my hon. Friend—these moments have been rare in my parliamentary career—that the Chancellor and the Prime Minister are both Members of this House. Therefore, they are representatives of both the Government and

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the House of Commons in those discussions. The important thing is that the trustees should not be able to sit on their hands if there is an unexpected surge in revenues that is faster than the trend growth rate of the economy. When the trustees produce a report, Parliament should be able to scrutinise it properly, after a report of the NAO. The latter is clearly set out in the Bill, but at the moment, whether there is a review in the five-year period is at the discretion of the trustees. Parliament should legislate today to say, “If you see something happening to revenues that is outside the Chancellor’s intentions as clearly set out by him, then there should be an immediate review.” It would still be for the trustees to decide what recommendation to make. We are not imposing a cap, because although some would like that, it would be outside the Chancellor’s intentions. I said from the beginning that I would support his reforms, and our amendment 8 delivers his reforms in detail. Therefore, I hope that he will reconsider and support our amendment.

Mr Kevan Jones: I think the Chancellor has tried to have an effect on that by, for example, putting a cap on the reserve, but does my right hon. Friend agree that it is also important to see how the reserve is spent? I said to the Chancellor that it does not take a genius or a financial wizard to work out that the way to do it is by keeping the reserve as low as possible by spending the money, so the Government’s proposals will actually lead to more inefficiency, rather than driving up efficiency.

Ed Balls: As I said, part of the motivation behind our amendments to the clauses that deal with the role of the NAO is precisely to ensure that the value-for-money question is at the centre of the NAO’s thinking and the PAC’s reports to this House. I am happy with the Chancellor’s view that it should be for the PAC and the NAO to decide when to do those reports, but they clearly cannot have a report looking at value for money without looking at all aspects, and that includes all expenditure that is financed by the taxpayer, and the use of reserves. For Parliament, that is the right mechanism. I understand that not everyone in the House will agree with those proposals, which is why it is important to get on to that debate.

3.45 pm

Sadly, my hon. Friend the Member for Bolsover (Mr Skinner) is not here, but in the last debate I referred to the fact that he voted against these reforms when they were last debated in substance in this House in 1971 and mentioned his barracking of Norman St John-Stevas from a sedentary position. I have since checked my hon. Friend’s subsequent contributions. In recent years, he has questioned Chancellors and Prime Ministers regularly in this House, doing so most recently in the July 2000 debate on the renewal of the civil list. His best contribution came when he described the £7.9 million civil list settlement to Her Majesty as

“a pretty big winter heating allowance…If the Prime Minister really wants to save money, the answer is to kill two birds with one stone by shipping them off to the millennium dome, where they can have a zone apiece.”—[Official Report, 4 July 2000; Vol. 353, c. 164-5.]

That option is not now available to the Chancellor of the Exchequer and it is not one that would find any support from Members on the Labour Benches. Strong

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views have always been expressed here, and in the 1971 debates considerably stronger views were put by Members on the Opposition Front Bench than anything that has been said in this debate, where we have sought to help the Chancellor to deliver the intention of his reforms. That is the motivation behind our amendments.

It is important to say that we are debating a significant reform; it is the biggest reform of the royal finances since the accession of King George III in 1760. I read through the Hansard record of the contributions made in recent decades by my hon. Friend, so I thought that I should read the pre-Hansard record of the debate and resolution in this House on 25 November 1760, when the then Government set out clearly their view that the use of the revenues of the Crown Estate was for Parliament to determine. [Interruption.] I do not know whether the hon. Member for North East Somerset recalls that particular debate.

In the recent House of Commons Library note on these matters provided to Members, the clear view of the experts in this House was:

“The Crown Estate is not the personal property of the Monarch. It cannot be sold by the Monarch, nor do any profits from it go to the sovereign.”

I think that that is the position as things stand. It was also the argument made on 25 November 1760 by the then Chancellor of the Exchequer, Henry Bilson Legge—probably a relative of the hon. Gentleman—who said that it was for Parliament to determine the use of these revenues and that they should do so in a manner

“as may best conduce to the utility and satisfaction of the public.”

In return, at the end of that debate the House resolved that

“there be granted to his Majesty, during his life, such a revenue”

as would

“support of his Majesty’s household, and of the honour and dignity of the crown”.

That was how the House of Commons resolved that issue on that day.

For 250 years, the Crown Estate has been at the disposal of this Parliament but, as then so today, it is the responsibility of Parliament to ensure that a fair and proper balance is struck between the interests of the taxpaying public and the needs and dignity of the royal household. As we enter the second decade of the 21st century, that is our task, not just today, but in the months and years to come.

Mr Edward Leigh (Gainsborough) (Con): I am humbled, Mr Evans, that you should have called me before my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg). I am grateful that there is somebody who is even more royalist and reactionary than me in the Chamber; my hon. Friend reminds me of one of the French courtiers who was plus royaliste que le roi—more royalist than the king—and that is no bad thing.

Of course I agree with the substance of what my right hon. Friend the Chancellor is trying to do today, but I hope that he will accept a couple of bits of advice or warnings. The constitutional position of the monarch and Back Benchers is rather similar: we warn and we advise. The difference is that the Queen does so in private and is listened to and we do so in public and are never listened to, but we will try our best. [Interruption.]

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Well, perhaps we are listened to sometimes. I am a bit worried about some parts of the Bill, particularly about how fixed in concrete the sum of money is.

We all know that there is no point having the British monarchy as a cycling monarchy or having it on the cheap. I know from my experience of looking at the accounts during the last two Parliaments that they are right on the edge of the £34 million. If one was trying to maintain extremely expensive buildings—I am not just talking about Frogmore now, but about large and complex buildings such as Buckingham palace or places such as Windsor great park—one would struggle. Some people, particularly in this House and particularly those with a slightly republican bent, might say that we are all making sacrifices, but this is part of our national heritage and it is not as if they are living in anything like the whole palace. They have a modest flat: as we know from one of the tabloid stings, the Queen lives very modestly with her Tupperware in a small flat in Buckingham palace. Ultimately, we, the public, are benefiting from Buckingham palace, Windsor and St James’s palace and they must be properly maintained. I am not sure whether we might need looser arrangements so that—I will not use the phrase “raid the reserves”—there is some sort of mechanism to handle that. Will the Chancellor comment on that when he sums up? It is terribly important that there should not be a constant constraint on the treasurer of the royal household to skimp on maintaining the royal palaces, because that is clearly happening at the moment.

Paul Flynn: One example of many of royal spending was a trip by Prince Charles and Camilla from Buckingham palace to Balmoral for which the taxpayer—[ Interruption. ]

Jacob Rees-Mogg: On a point of order, Mr Evans. I wonder whether you would rule on the correct way of referring to Their Royal Highnesses the Prince of Wales and the Duchess of Cornwall.

The First Deputy Chairman of Ways and Means (Mr Nigel Evans): I think that respect for members of the royal family is warranted and it would therefore be appropriate to show proper respect in referring to them in the House.

Paul Flynn: I shall ask the question again. Is it an example of people with financial limits skimping when the heir to the throne and his wife take a journey that costs £29,000 without any public engagements being involved—the journey was a private one—and send that bill to the taxpayers?

Mr Leigh: I am delighted that the hon. Gentleman has made that point. He is making the precise point I want to make, although we come from different directions, of course. That is the danger. As so often happens in the House of Commons, we are rushing at things and there are many unforeseen consequences; it would have been preferable to consider the Bill more closely and for longer. The point that the hon. Gentleman has made will be made in the Public Accounts Committee and such subjects will be dragged into the public debate.

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Why do I think that is dangerous? Let me make it clear that I am not against the move in any way. I welcome it and I am grateful that the Chancellor had a private word to brief me on this before he made his announcement. I am grateful for what he is doing, which is in response to the constant campaign that we members of the PAC have waged for many years to have greater transparency. No present or previous member of the PAC and nobody in Parliament doubts that we want more transparency about the public duties, the official travel, the official expenses and so on. That is modern, transparent and right.

The difficulty is where we draw the line. I am worried that the PAC and the Comptroller and Auditor General will gradually be dragged into the debate on precisely the sort of point that the hon. Member for Newport West (Paul Flynn) has made. How will the system work? The CAG will effectively be able to look at everything, but a defence is built into clause 13. The clause states:

“Any reference to the support of Her Majesty’s official duties includes the maintenance of Royal Palaces and related land.”

That is fair enough. Subsection (9) states:

“Any reference to the Royal Household if limited to that Household so far as it is concerned with the support of Her Majesty’s official duties.”

The clause also states:

“Any reference to the use of resources is to their expenditure, consumption or reduction in value.”

I suspect that subsection (9) was included to try to prevent the whole debate from widening to cover the private travel, private expenses and private servants of the royal family. Why is there a danger?

Paul Flynn: Will the hon. Gentleman give way?

Mr Leigh: May I make some progress first? I want to develop this point and if the hon. Gentleman is not satisfied he can come back to me.

If the PAC was a normal Select Committee that set its own agenda, we would have some people who were very pro-royal family and some who were not so pro, and there would be tremendous pressure on the Chairman in private sessions, with people saying, “We want to look at this aspect of travel,” “Why did the Prince of Wales make this official trip and spend all this money,” or “Why did they bring all their servants?” There would be a great argy-bargy. At the moment, our defence is that, uniquely, the PAC’s agenda is set not by the Committee or politicians but by the Comptroller and Auditor General. That acts as a kind of backstop to protect the royal family, but the changes could bring a real danger for them. Why? It is because we do not live in an entirely fair world.

The royal family is not like the Department for Work and Pensions—I shall not labour this point because I made it in the last debate on this. When the PAC looks at the DWP or another Department, it does its work and investigates the spending of billions of pounds, which is sometimes spent wisely and often not so wisely. With those reports there is limited public interest and the report tends to get into The Times, the Financial Times or the serious pages of The Guardian. With the royal family, things are completely different: not only is there massive public interest and huge pressure from journalists, but some newspapers have an agenda of constantly attacking the royal family and its members.

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Paul Flynn: Will the hon. Gentleman give way?

Mr Leigh: I am going to develop my point; the hon. Gentleman can come in later.

We have seen that agenda in the Daily Mail campaign against the Prince of Wales and in the Murdoch press—against many members of the royal family. We are getting into dangerous territory.

Mr Mark Spencer (Sherwood) (Con): Will my hon. Friend give way?

Mr Leigh: Let me go on a bit and then I shall give way to both hon. Members, as I want to be fair to both sides.

When I was the Chairman of the Committee I put no pressure on the Comptroller and Auditor General, but members of the Committee, including the hon. Member for Glasgow South West (Mr Davidson), who is present, Mr Alan Williams and others quite rightly had serious questions about the royal family. They took a particular view and were always agitating for us to do more work, but I was able to say that it was not my decision. It was the decision of the Comptroller and Auditor General who, frankly, took quite a conservative approach and did not allow many reports to come to the Committee or do much initial work. Although there is massive public and media interest in this issue, particularly in the tabloid press, there is much more important work that we need to be doing on public expenditure.

Hon. Members might ask what I am worried about, given that we can surely rely on the Comptroller and Auditor General—although I think that he will be under a lot of pressure via members of the PAC because they are eternally under pressure from the media to raise these sorts of questions. Why am I worried about all this? It is because I wonder whether clause 13 is an adequate defence. How do we define exactly what are the private affairs of the Queen? We know what she does in the homes that she owns—in Sandringham or Balmoral. We know about the gardener and the cook she employs and about private travel around the estate. That is completely out of all this. but what about what goes on in Buckingham palace and Windsor great park? Is the Comptroller and Auditor General going to be under pressure to investigate value for money, the number of servants and what happens with the private office? When does official travel start and when does private travel start? There have been attacks on Prince Andrew for taking official trips and then going on elsewhere to play golf. There will be more and more pressure mounting all the time and that could be extraordinarily damaging to the royal family, which is a very fragile institution. In no other major country is there a royal family; it survives on public opinion and I am afraid that there are some people, particularly in the tabloid press, who simply are not fair and who want to go on pushing and pushing because they want as damaging a story as possible. I shall now give way to the hon. Member for Newport West because he asks about precisely the sort of story that they will try to raise through the National Audit Office and the PAC.

Paul Flynn: I am grateful to the hon. Gentleman for giving way, although I am sorry that he has not answered my question about why a multi-millionaire should send

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a bill to the taxpayer for a private visit. May I take him back to his previous speech to the House on this issue in which he spoke as the former Chairman of the Public Accounts Committee—the guardian of the taxpayer’s interest—when he said that he had approved royal spending that he described as “fantastically wasteful”? Is that the way to guard the taxpayer’s interest?

Mr Leigh: The fact is that we must take everything in the round. I was making comparisons with the Heads of State of Germany and Italy, which are republican institutions that cost more and have virtually no public impact whatsoever and do nothing for the economy. I am afraid that it makes absolutely no sense in providing value for money to Great Britain plc to get rid of the monarchy. I do not accept that the institution of the monarchy is fantastically wasteful.

4 pm

Mr Spencer: Does my hon. Friend agree that, as we are talking not only about the Head of State but about the next in line to the crown of this great nation of ours, they should be allowed to travel in such a manner? Can he imagine a circumstance where the President of the United States arrived in the UK on easyJet? We should be proud that the head of this nation is allowed to travel in such style.

Mr Leigh: We live in such a public world now that the Prime Minister took Ryanair when he went on holiday.

Mr Davidson: I am grateful to the former Chairman of the Public Accounts Committee for giving way, and I have to tell my colleagues that he is not nearly as bad a man as he often appears. Does he accept that there is a difference between what the royal family undertake as their public duties, which should, quite rightly, be examined by the Independent Parliamentary Standards Authority or a similar organisation, and what they undertake in their private lives, which should not be accessible to the public? Does he accept that extravagances in their private lives should not be charged to the public purse? That really is the difference. Like the hon. Gentleman, I recognise that we do not wish to intrude into every element of that family’s life; but if they do not want us to intrude, they should not charge such things to the public.

Mr Leigh: I am not sure whether the Queen or the Prince of Wales charges “extravagant” aspects of their private lives to the public purse, but what worries me is that if Prince Charles went on an official trip to America and took so many hairdressers, butlers, private secretaries and all the rest, the media and the hon. Gentleman, if he was still a member of the PAC, would immediately demand a public inquiry, and there would be a gradual drip, drip of attacks in the tabloid press against the royal family. We should be aware of that and warn about it. That is why the role of the Comptroller and Auditor General is absolutely crucial; he is not a politician. The reason I am making these remarks—if he reads Hansard—is that he must stand firm and make an overall judgment.

Mr Davidson: I can assure the House that, when I have travelled abroad, I have certainly never taken a hairdresser with me.

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The sort of rules that apply to the Prime Minister ought to apply to the royal family in this context. The Prime Minister and senior members of the Government must have a certain degree of support and status when they travel abroad on parliamentary and official business. The royals similarly ought to have some status when they travel abroad. However, the two ought to be comparable. To be fair, the Prime Minister has never taken hairdressers, butlers, valets, chauffeurs or anything similar with him.

Mr Leigh: This debate is useful in a way, because it shows precisely the problem. I understand that the Duke and Duchess of Cambridge have taken extremely modest entourages and staff on previous trips. Apparently, the Duchess has had more than 37 different changes of outfit in America and Canada. I do not suppose that the Prime Minister or even the hon. Gentleman changes his outfit 37 times when he goes on Select Committee trips abroad. There is a completely different order of scale between a Head of State, who is part of the ornamental part of the constitution and who represents our country, and even the Prime Minister. If we are now to have questions and relentless pressure in the PAC about how many dresses need to be taken on every royal trip, it will be ridiculous, and it would start to make the royal family look more and more ridiculous. That is what I am warning against.

Mr Kevan Jones: Does the hon. Gentleman think that this country’s defence budget should subsidise the royal flight? If we believe what was reported in The Mail on Sunday last week, the Ministry of Defence did the right thing by charging the going rate for use of the royal flight. Only because of complaints to the Chancellor of the Exchequer by the Prince of Wales was that amount reduced. Therefore, every flight that the royal family takes is being subsidised by the defence budget. That cannot be right.

Mr Leigh: I do not know the exact truth about that particular aspect.

Mr George Osborne: The part about my involvement is completely untrue.

Mr Leigh: All that I know—the Public Accounts Committee having had all those accounts over the past two decades—is that steps are constantly being taken to deliver a better-value-for-money monarchy. If that is not true, why has the cost gone down from £49 million to £34 million? I shall sit down now, because we are only on clause 1 stand part.

Paul Flynn rose—

Mr Leigh: I will not give way; I have already given way to the hon. Gentleman once. I want to emphasise this point to the Chancellor: I hope that there is a flexible arrangement, so that we can protect the structure of the royal palaces. I sincerely hope that the Comptroller and Auditor General will take a very conservative view of his responsibilities when he draws up reports, and that he will focus them absolutely and firmly on the public duties of the royal family, in the spirit of the Bill.

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Stephen Phillips (Sleaford and North Hykeham) (Con) rose—

The First Deputy Chairman of Ways and Means (Mr Nigel Evans): Is the hon. Member for Gainsborough (Mr Leigh) giving way, or has he sat down?

Mr Leigh: My hon. and learned Friend the Member for Sleaford and North Hykeham (Stephen Phillips) is desperate to get in, so I give way to him.

Stephen Phillips: I am not sure that I have ever been desperate to get into anything. I think it was in 2005, when my hon. Friend was the Chairman of the Public Accounts Committee, that the Committee published a report, which he will probably remember, that drew attention to a potential conflict of interest between the Duke of Cornwall and future Dukes of Cornwall. That is not addressed at all in the Bill. Does he share my hope that my right hon. Friend the Chancellor of the Exchequer will deal with that point in his wind-up, and that the Government will look at the issue in future?

Mr Leigh: That is a serious and important point. We have had mention of the Duchy of Cornwall; I should say that we did some trailblazing work in our hearing about the duchy. The hon. Member for Glasgow South West will remember that we ranged widely over all aspects of its management. One of the issues that we raised was whether we should maximise resources—income and capital—for the present Duke of Cornwall, or for future generations. I hope that the Chancellor can also reply to that point when he winds up.

Several hon. Members rose

The First Deputy Chairman of Ways and Means (Mr Nigel Evans): As Members can see, there are at least six people trying to get in on the debate on this clause; we are incredibly time-limited, and I ask people to respect that.

Mr Kevan Jones: The aim of the Bill is right: to provide the sovereign with the funds that she and other members of the royal family require to do their public duties. I do not think that there is any disagreement on that at all.

On the point about how we arrived at 15%, I welcome the Chancellor’s acceptance of some of the amendments in the name of my right hon. Friend the Member for Morley and Outwood (Ed Balls), but there are a few questions still to be answered. I understand why the amount is set at 15%—to get to the figure of £34 million in future years—but my concern is that if we are to have a proper look at what the sovereign costs, we should include all costs, and then determine that the Government or state should provide the money to the sovereign for carrying out those duties.

I accept that there is greater transparency under the Bill, which is welcome, but the hon. Member for Gainsborough (Mr Leigh) seems to think that we will somehow be intruding into areas into which we should not go. I am sorry, but if we are talking about public money, its spending has to be scrutinised, as does the

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spending of public money by any Government Department. My concern is that we arrived at the £34 million figure, based on 15%, without taking into account the moneys that go from Government Departments to the royal household to support the royal family in their duties. I shall talk about defence, an area that I know more about, as a former Defence Minister.

A large number of individuals in the armed forces—I have asked how many—have a role supporting the royal household. Some people might question whether that is necessary, but I think that it is, because they play an important role in supporting the monarch and other members of the royal family. However, I do not think that the costs involved should come out of the defence budget, as they currently do. The costs should be taken from the moneys we pay to support the sovereign’s work, because those men and women of the armed forces clearly do an important job in supporting the sovereign in her duties as Head of State, but we do not know what those costs amount to.

Similarly, is it legitimate for Her Majesty the Queen and other members of the royal family to use private aircraft for state duties? I fully support that, not just from a security point of view, but because of the status that we wish to give members of the royal family when they represent this country on royal duties, as my hon. Friend the Member for Glasgow South West (Mr Davidson) suggested. However, I do not think that the defence budget should be used to subsidise that expenditure. For example, if it costs a set amount for the RAF to fly Her Majesty or any other member of the royal family somewhere, that amount should rightly be met by the taxpayer if it is an official duty.

Mr Spencer: Does the hon. Gentleman recognise that defending our nation includes defending our Head of State?

Mr Jones: Yes, but what I am talking about does not relate to security. I am talking about equerries and other people who play a vital role in running the royal household and who are important in Her Majesty’s representational role. In the previous debate people tried to conflate the two issues, but I am talking about ceremonial duties that are being paid for from the defence budget.

Dr Murrison: Until recently the hon. Gentleman was a Defence Minister, and a very good one, so I wonder, since he feels so passionately about this, what efforts he made to identify those costs.

Mr Jones: I also chaired the value for money group in the Ministry of Defence, and those costs were on the radar screen for the work it was carrying out. There is a sense of grievance in the MOD and the armed forces that this money comes out of the defence budget. There should be some recognition of this vital work, but it should not come out of the defence budget. That would also avoid the nonsense that we saw last week in The Mail on Sunday, which claimed that the Prince of Wales and other members of the royal family stopped using the royal flight because the cost was being charged to the royal household. I understand that after representations were made to the Treasury the cost was reduced by £6,000 an hour for the use of one of the royal flights.

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Therefore, a basic subsidy is going to the royal household from the defence budget, which I do not think is right. If the full cost of the royal flight is £13,000 an hour, the Government should pay for that to support members of the royal family who need to travel on official duties. I have no problem with that, but I have a problem with where it comes from and how it is accounted for.

Michael Ellis (Northampton North) (Con): Does the hon. Gentleman not accept that these military equerries and the like are on secondment from military duties? They remain military officers in the service of the Crown via the Ministry of Defence, so it is quite appropriate that they should be paid by the Ministry of Defence?

Mr Jones: No, I am not suggesting that somehow they should be taken out of the military while they do these duties, because there is an important link between the royal household and the military, but I do not think that they should be paid for from the defence budget while they are on these duties. In trying to get full transparency in what the royal household costs and therefore what the sovereign grant should be, we need to know about all these other costs so that we assess what is needed to support the sovereign in her work as Head of State. There needs to be transparency.

The Chancellor said earlier that the NAO could look at this, but there is nothing in the Bill that says it will look at costs in kind in relation to the Ministry of Defence and other budgets. If we are to ensure that the royal household has the money needed for the royal family to do their official duties, it is important that there is transparency and that the costs do not fall on the Ministry of Defence, for example.

Some people argue that there should be a cap every year on the sovereign grant. That is possibly a bit too blunt a mechanism. I accept what the Chancellor has said about the size of the reserve. However, if we are to ensure that the efficiencies that have taken place so far in the royal household continue, we need to consider not only how the sovereign grant, but the reserve, is spent each year. It would be quite easy to run the reserve down each year to ensure that more money is needed every year. There needs to be some scrutiny of exactly how the reserve is spent.

4.15 pm

The next issue is what the sovereign grant is spent on. At the moment, some of the arrangements are totally inefficient in that the Government are paying the royal household and then being paid back for services. There is a debate to be had about whether the royal palaces are royal households or part of the history of this country that should be paid for by the taxpayer. The places currently covered by grant in aid are Buckingham palace, St James’s palace, Clarence house, the Royal Mews, the residence and offices in the area of Kensington palace, the royal paddock at Hampton Court, and Windsor castle and the buildings in Home park and Great park. The list is quite well defined. It would be interesting to know whether the sovereign grant will be limited to being spent on those places or there will be flexibility to use the money for other households. In 1990, Marlborough house was added to the list of properties that the Department for Culture, Media and Sport supports through grant in aid. To ensure that we are not cross-subsidising things that are already covered, it will be

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important for the Chancellor or the trustees to clarify exactly what the sovereign grant could be spent on; otherwise, other properties that are not currently covered by the civil list or grant in aid payments could be included. That is an important point.

I take the point made by the hon. Member for Gainsborough (Mr Leigh) about the titillation factor in looking at what the royal household spends money on. However, the core point is that this is Government—public—money. If we do not want the royal family to be denigrated but rather to gain support for them, one way would be to ensure that the sovereign grant is well spent and that people see that that is the case. We accept that some items are very expensive to undertake, such as the upkeep of royal palaces and—I have to agree with the hon. Member for Gainsborough—the way in which people have to travel for security reasons, but there must be an emphasis on ensuring that the taxpayer gets value for money. That is a way of strengthening support for the sovereign and the work that she and her family do on behalf of the nation. If we going to get this right, and the Bill is a good attempt at trying to do so, we must ensure that we not only get value for money but are very clear and honest to everybody about all moneys that are spent on supporting the sovereign in the work that she does.

Michael Ellis: Will the hon. Gentleman give way?

Mr Jones: I was about to conclude, but go on.

Michael Ellis: The hon. Gentleman refers to concern about value for money. Does he accept that the royal family bring in hundreds of millions of pounds to the state every year as juxtaposed with the few millions that it costs to run the royal family, most of which is spent on public buildings?

Mr Jones: That is another debate and it is difficult to quantify what the hon. Gentleman says is brought in. I do not just look at this in terms of money, but take the more fundamental view that we have a Head of State and should support her in the work that she does on behalf of this nation. What I am saying is that we need to be clear about what that costs. We should be honest about how much it costs, even if it costs more than £34 million, and not hide the way in which moneys are spent.

I broadly welcome the thrust of the Bill, but I hope that the NAO report looks not just at how royal expenditure is spent on the sovereign grant, but at other moneys that are paid to the royal household. It might suggest, for example, that the money that comes from the Ministry of Defence should not come out of defence expenditure.

Jacob Rees-Mogg: The shadow Chancellor concluded his remarks by saying that he had looked up the Commons Journal for 1760. He is, of course, a very modern man. I went a little earlier and looked up the Commons Journal for 1575. I thank the Library for its assistance in helping me to find what I was looking for. I was looking for the behaviour of the House towards a Mr Peter Wentworth, a man who represented a Cornish seat and had the temerity to criticise the then sovereign, Elizabeth I. He said that

“none is without fault, no, not our noble Queen”.

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For this “prepared speech” and

“divers offensive matters touching Her Majesty”

he was taken prisoner to the Tower and held there for a month at the insistence of the House of Commons. I must say that I think they knew how to behave in 1575, and it is a model for us today.

I want to come on to who really owns the Crown Estate, because that is important in this discussion. That is why I intervened on the Chancellor, and I am grateful to him for taking my intervention. It is important to remember that the Crown Estate is the property of the sovereign in an ultimate sense, though gifted for a reign. The importance of that is that the sovereign therefore has a right to ask for money. One might think that they would get the money anyway, but sovereigns have been promised money by Parliament that has been stopped. One just needs to go back to Charles II, who handed over all his feudal dues to the Government for £100,000 a year in perpetuity for all his heirs and successors. I am not sure that that £100,000 has been paid once in the last three hundred and some odd years. The Crown, by virtue of owning the Crown Estate, can guarantee that it is entitled to a revenue. The fact that at the beginning of each reign it could theoretically demand the Crown Estate back is important reassurance and a reassertion of that right.

Mr William Cash (Stone) (Con): Is my hon. Friend conscious of the fact that at the time of the secret treaty of Dover in 1670, the Crown would not recall Parliament because Louis XIV insisted that we should do what the French and the rest of the Europeans wanted, in return for which he would give enough money to Charles II to keep him in with his mistresses and the royal household in the manner to which he felt he should be accustomed?

Jacob Rees-Mogg: I remember the secret treaty of Dover well, although I was not an active participant. However, it is not particularly relevant to this debate. It has to be borne in mind that Louis XIV did not deliver the cash, which is always a slight problem in such negotiations.

The Crown Estate belongs to the sovereign. Any other great landowner who has inherited land owns that property outright and is free to pass it from generation to generation. The Crown Estate is in that position. We have discussed before whether, because it is exempt from death duties or because it used to be used to pay for Government expenditure, it is in some sense different and the nation’s. I would argue that that reasoning is not accurate. In the same way that the feudal duties that fell upon other landowners were abolished as time went on, so the Crown Estate would in all normal circumstances have become the Queen’s outright.

I therefore go back to my point, which the hon. Member for Newport West (Paul Flynn) dislikes, that the Queen pays an 85% tax rate. There would be £200 million or more in income for the Queen every year, but in fact there will be only about £30 million. So Her Majesty is the highest-paying taxpayer in this country. Members of Parliament might like to think that we could do a deal with the Government, hand over our salary and be given £9,000 a year back.

Mr Davidson: Does the hon. Gentleman recognise that there is a distinction between the monarch as an individual and the monarchy as an institution? The

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Crown Estate is the property of the state, inasmuch as it is the property of the monarchy as an institution, not the monarch as an individual. It is therefore untrue to say that the monarch as an individual is paying 85% tax.

Jacob Rees-Mogg: I am very grateful to the hon. Gentleman, but I think it is immeasurably confusing when we start trying to divide the Queen up in that way. Her Majesty is our sovereign, full stop. She is one person, indivisible. She is not the trinity—Her Majesty the Queen, Her Majesty Mrs Windsor and Her Majesty the third party of the trinity. It does not work like that. She is one sovereign individual.

The next point that I want to make is one on which I agree, as I often do, actually, with the right hon. Member for North Durham. [Hon. Members: “Honourable.”] I am so sorry, the hon. Member for North Durham (Mr Jones). It is in Her Majesty’s gift, of course, to promote him, and perhaps she might have looked more favourably on that if he had been a bit more loyal in his comments. However, I agree with his point that we have to pay for the constitution that we have. The Queen is not here to bring in tourism and things like that. She is here as an essential part of our constitution. That is why it is worth the military taking on the costs of sending attachés and so on and so forth. The military owe their loyalty to the Crown, not to politicians, senior generals or people who could abuse that power to change how this country is run.

Our constitutional settlement, which works extraordinarily well and has worked well for hundreds of years, is worth paying for. On that basis, we get stability as a nation and the effective operation of our constitutional system. The judges owe loyalty to the Crown; the military owe loyalty to the Crown; we, as Members of Parliament, swear an oath to the Crown. It is the Crown that is at the pinnacle of our constitution, outside and above politics and a defender of our liberties. Indeed, as Charles I said at the scaffold, he died the martyr of the people, because he had been defending the liberties of the people, as the Queen has done now for jolly nearly 60 years. We must be willing to pay the right price for our constitutional settlement, and I think that should be a generous price.

Michael Ellis: Does my hon. Friend agree that the fact that each sovereign since 1760 has been asked by successive Governments to sign over the proceeds of the Crown Estate, in and of itself, proves that the estate belongs not to the country but to the person of the sovereign?

Jacob Rees-Mogg: My hon. Friend is of course right.

It is often said that Her Majesty is the golden thread that binds our nation together, and the key part of that phrase is the word “golden”. Her Majesty is not the cotton thread, or the silver thread, or the woollen thread, she is a golden thread that binds the nation together as one unique, great and noble nation.

Paul Flynn rose

Jacob Rees-Mogg: It is always an honour to give way to the hon. Gentleman.

Paul Flynn: I am grateful to the hon. Gentleman for giving way before he goes into hyper-rant. Does he realise that the fantasy that he is describing has been

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changed by the fact that many hon. Members, who are forced to say an oath—they have no choice—put a preamble to that oath that alters its meaning? The process of a decision to go to war was changed when the House decided to vote on wars in 2003, and probably on all future wars.

Jacob Rees-Mogg: There is a completely separate question, outside the remit of this debate, on the prerogative powers. It has well been established that the prerogative can be bound by legislation, and legislation comes from this House. However, that has very little to do with the Crown Estate and the financing of our sovereign, which, as I said, is something that we should do properly.

We then have the question of scrutiny and the Public Accounts Committee. I make no bones about it, I think it is inelegant, ungallant and improper to look at every biscuit that Her Majesty wishes to buy. I think Her Majesty should have as many biscuits as she likes, and if they are chocolate Bath Olivers rather than Rich Tea, so be it. I just do not think it right for a Committee of this House to look into that.

4.30 pm

There is a risk—my hon. Friend the Member for Gainsborough (Mr Leigh) put this incredibly well, as he always does—of people using that for political advantage. That may have changed, because yesterday, sitting in this Chamber, we suddenly discovered that all politicians now loathe the press and think that they are not worth dealing with, so my previous concern that members of the Public Accounts Committee might use investigating the monarchy to get publicity is clearly no longer true, because they so dislike the press that even to appear on the front page of the newspapers would be such an embarrassment that they would eschew the opportunity. However, times may change again, and it is of serious concern to me that the Public Accounts Committee could spend time looking at the £35 million spent on the sovereign grant rather than at the £6 billion that was wasted by the Ministry of Defence. We really do not want to get into a situation in which the PAC concentrates on something that is de minimis in the broader scheme of things because that is more appealing in terms of publicity.

Let me conclude—[ Interruption. ] Thank you. Let me conclude with the words of Her Majesty on her 21st birthday in South Africa:

“I declare before you all that my whole life whether it be long or short shall be devoted to your service and the service of our great imperial family to which we all belong.”

Mr Evans, God save the Queen.

The First Deputy Chairman of Ways and Means (Mr Nigel Evans): Follow that, Mr Davidson!

Mr Davidson: It is difficult to follow a speech like that because in many ways, it took the biscuit.

Chris Ruane: Bourbon!

Mr Davidson: Of course, as my hon. Friend says, that biscuit would be a Bourbon.

It is worth while clarifying the question of the ownership of the Crown Estate. Is it owned by the monarch as an individual or the monarchy as an institution? When the

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Public Accounts Committee looked at this matter, there was a consistent attempt by officers of the monarchy to confuse and conflate the two. We need to ask ourselves this question: were the monarchy abolished, would Crown Estate moneys and properties belong to the deposed monarch as an individual or would they remain with the state? It is quite clear that they would remain with the state. Therefore, the moneys and the estates are not the property of the individual who happens to be the monarch at any particular time. That clarifies a number of things.

Mel Stride (Central Devon) (Con): Will the hon. Gentleman give way?

Mr Davidson: No, I want to proceed because we are short of time.

I am seeking clarification from the Chancellor, who, I remember, was on the Public Accounts Committee when he was a young whippersnapper—I have often wondered what happened to him since. Will the National Audit Office, the interventions of which I will welcome, also be able to look at all elements of royal involvement? In particular, can it look at the royal art collection, about which there were serious discussions and disputes in the past? That would seem to be covered by what he has said, but it is not immediately clear.

Is the Crown Estate the right body to take into account when determining the monarch’s income? Those of us on the Public Accounts Committee who examined the Duchy of Cornwall’s accounts were absolutely clear that the Duke of Cornwall was manipulating the money involved, by playing a major role in determining the amounts of expenditure and income, thereby determining how much money came, or was available, to him as an individual.

Quite clearly, the Crown Estate could be leant on by the monarchy to make decisions on expenditure and income in the short term to affect the amount of grant that the royal family receive. The grant would then be on, as it were, a golden ratchet—a bit like EU expenditure, it would always go up, and never down. There is clearly scope for abuse in those circumstances. Will the Chancellor clarify those points?

Will the Chancellor also take into account the fact that there is due to be a windfall from wind and wave power? Will he assure the Committee that all of that will be taken into account when the review takes place in due course?

Mr George Osborne: I shall deal briefly—because time is short—with the points raised. I should say first, however, that I am grateful to the Committee and the Opposition Front-Bench team for the general support they have given to clause 1 and indeed the whole Bill.

My hon. Friend the Member for Gainsborough (Mr Leigh) raised the key question: how do we create a mechanism that preserves the dignity of the monarchy while ensuring that the House is accountable for the expenditure of public money? As I said in my opening remarks, there is the question of whether the money provided is enough or too much. I said that we do not want a cut-price monarch or a lavish monarchy. As a general guide, I have looked at how much the monarchy

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has spent over the past five years. On average, £34 million of public money has been given per year through various forms of grant and money drawn from a reserve built up using public money. I have said that that is not a bad guide for the future and that 15% of Crown Estate revenue will provide that amount over the rest of the Parliament. In 2016, we will review whether that is the right amount.

Mr Cash: The Chancellor referred just now to something that I found difficult to accept. He distinguished between a cut-price monarchy and a lavish monarchy. Given Her Majesty’s incredibly distinguished performance over the past nearly 60 years, to which my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg) referred, does he appreciate that this is not about being lavish, but about effectiveness and dignity?

Mr Osborne: I agree that it is all about effectiveness and dignity, and I think that the Bill strikes the right balance between those who say that the monarchy is spending too much and those who say that it is not getting enough money for its official duties. The Bill has been discussed with the royal household, and it is content with it, which is why the whole process began with a Gracious message.

I want to clear up a misunderstanding. There will be a real-terms increase in the annual sums that Parliament provides, but that is because the royal household has been relying on a reserve of public money that has built up over time. That reserve has come to an end, and as I said a couple of weeks ago, the previous Chancellor of the Exchequer, perfectly reasonably when confronted with this issue before the general election, said, “I think we’ll wait until after the general election and let whoever are the Government then deal with it.” We are here because we have been relying on a reserve of public money that has run out. However, with the mechanism we are putting in place there will be a real-terms reduction of up to 9%—on our estimates—in public support for the royal household.

The shadow Chancellor and others, including the hon. Member for Glasgow South West (Mr Davidson), asked what would happen if there was a windfall from, for example, the offshore marine estate. At the moment, that constitutes a very small part of the revenues of the Crown Estate—about 1%, as I understand it. It is perfectly possible that, in the latter part of the decade or in the next decade, there will be a big increase, but, because I have accepted the spirit of the Opposition amendment, we will now have a review in 2016 and will be in a much better place to assess whether there will be such a windfall. However, I think that it is highly unlikely. No one is predicting a massive windfall in the next three or four years leading up to that review.

The reserve provides a check. The expenditure of the royal household is audited by the National Audit Office and if the money is not being spent for purposes for which it is provided by Parliament, it will come out in the audit. If there is an excess—in other words, if the sovereign grant is more than it needs—it goes into a reserve. That is a long-established principle. There is now a check on that reserve so that it cannot rise above 50% or thereabouts of the money from the sovereign grant, which was not the case before the Bill was presented to the House. The trustees—the Prime Minister, the

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Chancellor and the Keeper of the Privy Purse—have to provide an annual report to the Treasury, and through the Treasury to Parliament, on that reserve.

A couple of specific points were made about Marlborough house. The hon. Member for North Durham (Mr Jones) raised this point a couple of times. Marlborough house will remain the Government’s responsibility and is currently used by the Commonwealth Secretariat, as I am sure he knows. It will be up to the royal household to decide what premises it needs. It would, for example, be able to rent premises if it needed to, but I do not think that that is relevant to the support that we are providing.

The hon. Member for Bristol West (Stephen Williams), who is no longer in his place, asked about the mausoleum. It will stay on the English Heritage buildings at risk register until it is repaired in five to eight years’ time. My hon. Friend the Member for Gainsborough asked about the governance of the Duchies of Lancaster and Cornwall. I did not think it appropriate to open up that issue in this Bill, which is more narrowly focused on the official support that Parliament provides to Her Majesty.

I hope that I have now answered all the questions that have been raised, and that clause 1 can now proceed to stand part of the Bill.

Question put and agreed to.

Clause 1 accordingly ordered to stand part of the Bill.

Clause 2

Accounts of the Royal Household

John McDonnell (Hayes and Harlington) (Lab): I rise to speak to amendment 1, page 2, line 31, at end add—

“(4A) The statement must be accompanied by information showing the numbers of directly or indirectly employed hourly-paid staff of the Royal Household working in or in connection with the Royal Palaces in London who in the financial year in question were paid at or below £8.30 an hour.”.

I shall be as brief as possible, given the time constraints. The amendment is straightforward. Clause 2 proposes that the royal household’s accounts are to be reported. I am asking that a statement be included in that report to show the number of employees who are directly or indirectly employed by the royal household and who are being paid at or below £8.30 an hour. The reason that I have arrived at the figure of £8.30 is that that is the London living wage, as set by the Mayor of London, who has described it as the wage level designed to provide a

“minimum acceptable quality of life”

for people working in the capital.

The London living wage was started by a group of religious organisations, churches and trade unions 10 years ago, as part of a campaign by London Citizens. They came together to try to tackle poverty, and recognised that the national minimum wage did not allow people to avoid living in poverty in the capital city. They have campaigned over the past decade to press employers to pay the London living wage. They have targeted cleaners, in particular, who are living in poverty. They campaigned and they won. First, they won in a number of banks at Canary Wharf, then they came to Parliament and ensured that we paid our cleaners the London living wage. The campaign continued right through the capital, and more

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than 200 major companies have now signed up to the London living wage campaign. The Prime Minister himself described it as

“an idea whose time had come”.

The Leader of the Opposition appeared with him on a platform before the general election with members of London Citizens to sign up to the London living wage. Every mayoral candidate has supported it. Why? They did so because all of us want to see people living out of poverty. Yet in the royal household, which is only a mile and a half away from here, the workers who are employed by contracting companies including KGB—

Chris Ruane: The Russians!

John McDonnell: It is an unfortunate name, but there we are.

People working in the royal household for companies such as KGB and GreenZone are being paid £6.45 an hour, maximum. We have discovered that many of them are organised by the Public and Commercial Services Union, which is not recognised by the companies. Many of those people do not even have written contracts, which is an illegal practice. The number of jobs there has just been cut, and the work load has increased. Some people have had their hours increased, but they are still living on poverty wages.

The amendment would simply ask the royal household to publish the information on how many people working for the royal family, cleaning their rooms and corridors and serving them in different ways, are being paid below the London minimum wage. In this way, I want to recruit the royal household to support the London Citizens campaign. I want it to lead the campaign. As the Mayor of London himself has said, no company in London should be paying less than the London living wage. The Prime Minister, the Leader of the Opposition and, I believe, the Chancellor and the shadow Chancellor have signed up to the campaign in the past. The amendment simply seeks to tackle poverty wages in London. On that basis, I hope that we can expect the unanimous support of the House.

4.45 pm

The First Deputy Chairman of Ways and Means (Mr Nigel Evans): The Question is proposed that the amendment be made.

Hon. Members: No.

John McDonnell: On a point of order, Mr Evans. I do not wish to move the amendment at this stage. Having made my statement, I do not wish to delay the Committee, as there are more important amendments to consider.

Clause 2 ordered to stand part of the Bill .

Clauses 3 to 6 ordered to stand part of the Bill.

Clause 7

Review by Royal Trustees of Sovereign Grant

Manuscript a mendment proposed: A, page 6, line 7, leave out ‘7’ and insert ‘4’.—(M r George Osborne.)

The First Deputy Chairman of Ways and Means (Mr Nigel Evans): With this it will be convenient to discuss the following:

Amendment 6, page 6, line 7, leave out ‘7 years’ and insert ‘3 years’.

14 July 2011 : Column 565

Government manuscript amendment B.

Amendment 7, page 6, line 8, leave out ‘7 years’ and insert ‘5 years’.

Amendment 8, page 6, line 8, at end add—

‘(6) The Trustees shall also review the percentage for the time being specified in Step 1 of section 6(1) as soon as practicable if, over the financial year immediately preceding the base year, the income account net surplus of the Crown Estate increased by more than the trend rate of GDP growth.

(7) In subsection (6), “the trend rate of GDP growth” means the estimate of the trend rate of GDP growth most recently published by the Office for Budget Responsibility which is applicable to that year.

(8) Subsections (2) to (4) shall also apply to a review carried out under subsection (6).’.

Kerry McCarthy (Bristol East) (Lab): I wish to speak briefly to amendment 8. This would introduce a check on potential future rises in income from the Crown Estate. At a time when Departments and the public generally are having to take very difficult decisions to make their limited budgets cover the essentials, we should at least apply careful analysis to what sort of income the 15% figure would bring in for the royal household over future years. I would appreciate any information Ministers have on forecasts for the sovereign grant over the coming years, particularly regarding this spending review period.

We are very short of time, but I shall press on with the issue of meeting the royal household’s needs. When I met the Economic Secretary yesterday—I was pleased to have the opportunity to discuss these issues with her and the Bill team—we had a discussion about the fact that the civil list has not adequately reflected the needs of the royal family in the past. At one point, it was being paid too much money and amassed significant reserves; then, it was not paid enough to meet its needs and had to draw down on the reserves. I appreciate that the current formula may not be appropriate, but a formula fixed to income on the basis of something like the Crown Estate is not necessarily any more likely to meet royal spending needs.

In 2010-11, the Crown Estate profits were £230.9 million. If the new mechanism were already in use, that would mean a grant in two years’ time of £34.7 million. Instead, the 2012-13 grant has been set at £31 million in recognition that 15% would not be appropriate or proportionate. This is why we are asking the Government to consider a more flexible mechanism in future.

When the Chancellor spoke in the preliminary debate the other week, he said that the grant to the royal family should reflect generally how well the economy is doing. The particular concern we have—it has been touched on already—is that the Crown Estate includes investment in offshore wind, particularly the new wind-power projects that are coming on board. I think the chief executive of the Carbon Capture and Storage Association said that the carbon capture and storage industry is likely to be very big in the future, probably measured in trillions of dollars. We think that could have an impact on the accounts, too.

We were grateful for the Chancellor’s assurances during the debate on the funding resolution that we will not allow revenues from offshore wind to lead to a disproportionate rise in revenues for the royal household. I would be grateful for any further information about what safeguards could be put in place.

14 July 2011 : Column 566

Amendment 8 would help. It would limit disproportionate increases to the royal household. I welcome the fact that the Government have tabled manuscript amendments in response to our amendments which would provide an earlier review period. As the Bill was originally drafted, the first review of the new arrangement would not have taken place for seven years and there would then have been a review every seven years after that. We thought that the first review should take place within three years and that subsequent reviews should take place every five years. We have listened to what the Government had to say about three years being unfortunate in that it would coincide with the next general election. We are happy to accept the Government manuscript amendments that the first review should be four years and subsequent reviews every five years. We do think, however, that there should be another mechanism to address the fact that no cap is in force. There is a cap on the reserves, but there is no cap on the potential increases that the 15% figure, linked to the income of the Crown Estate, could generate.

I shall skim over much of what else I was going to say, but we think it important to have some upward cap. I shall be interested to hear what the Minister or the Chancellor have to say in response.

Mr George Osborne: As was acknowledged by the shadow Chancellor, we have taken on board what I consider to be the most significant amendments in tabling our own manuscript amendments. There will now be a review in 2016, and there will be a review every five years after that. If the House accepts our amendments we shall be able to prevent some windfall from offshore renewable energy from not being taken into account before it comes about. We will have a chance to do that in 2016, and that is partly because we have accepted the Opposition’s amendments.

I have already dealt to some extent with the point raised by the shadow Chancellor, and by amendment 8, about whether some other mechanism is needed. A fair number of checks are already in place. If the grant turns out to be more than the royal household needs—and the assessment of need will be checked by the National Audit Office—it will go into a reserve. If the reserve hits 50% of the grant, the trustees will step in and reduce the amount of money coming in. They will turn down the taps. That is a sensible mechanism, and it means that we will not be having an annual debate in the House about royal finances, entertaining though the last few hours have been.

The hon. Member for Bristol East (Kerry McCarthy) specifically asked why the figure for 2012-13 was £31 million. In a sense, that question lies at the heart of the issue. I accept that this is a complicated concept. The royal family have been relying on grants from Parliament—either the civil list or the royal travel or royal palaces grant—and supplementing them with a reserve which has been built up, with the use of public money, in the last decade or two. In 2012-13 the royal family will get the £31 million, but they will also expect to draw on the last of the reserve that was built up in the 1990s and 2000s. They will, in effect, receive more than £1 million from public money—money raised through taxation—because they will be using the last of that reserve.

Ed Balls: When I said that there would be a 3.2% real-terms rise from next year until the end of the Parliament, I did not mean a rise in the grant; I meant a rise in total

14 July 2011 : Column 567

expenditure. Total expenditure in 2012-13 will be £33 million and will rise to £35.5 million, which, in 2010-11 prices, is a rise from £31.3 million to £31.9 million. Although the Chancellor has made an important historic point about the reserves, the 3.2% real-terms is not driven by the reserves: it is merely an overall rise in total expenditure. I do not think that the Chancellor was entirely right on that point.

Mr Osborne: The point I was making was that, although there are lumpy movements in individual years—in 2010-11, for various reasons, some capital works were delayed and will be undertaken next year—the average of £34 million, which was £37 million two years ago, amounts in effect to a cash freeze and a real-terms reduction.

Ed Balls: Over the Parliament.

Mr Osborne: Over the Parliament. But the point is that it strikes the right balance between too much and too little.

I think that the checks are adequate, and for that reason, although I have accepted a couple of the Opposition’s amendments, I do not wish to accept amendment 8.

Manuscript amendment A agreed to.

Manuscript amendment made: B, page 6, line 8, leave out paragraph (b) and insert—

‘(b) every period of 5 years beginning at the end of another review period.’—(Mr George Osborne.)

Amendment proposed: 8, page 6, line 8, at end add—

‘(6) The Trustees shall also review the percentage for the time being specified in Step 1 of section 6(1) as soon as practicable if, over the financial year immediately preceding the base year, the income account net surplus of the Crown Estate increased by more than the trend rate of GDP growth.

(7) In subsection (6), “the trend rate of GDP growth” means the estimate of the trend rate of GDP growth most recently published by the Office for Budget Responsibility which is applicable to that year.

(8) Subsections (2) to (4) shall also apply to a review carried out under subsection (6).’.—(Ed Balls.)

Question put, That the amendment be made.

The House divided:

Ayes 148, Noes 241.

Division No. 327]

[4.55 pm


Abrahams, Debbie

Ainsworth, rh Mr Bob

Alexander, Heidi

Ali, Rushanara

Allen, Mr Graham

Ashworth, Jon

Bailey, Mr Adrian

Bain, Mr William

Balls, rh Ed

Banks, Gordon

Barron, rh Mr Kevin

Beckett, rh Margaret

Begg, Dame Anne

Benn, rh Hilary

Benton, Mr Joe

Betts, Mr Clive

Blackman-Woods, Roberta

Blenkinsop, Tom

Blomfield, Paul

Blunkett, rh Mr David

Bradshaw, rh Mr Ben

Brown, Lyn

Bryant, Chris

Burden, Richard

Campbell, Mr Alan

Caton, Martin

Clarke, rh Mr Tom

Clwyd, rh Ann

Coffey, Ann

Connarty, Michael

Cooper, rh Yvette

Corbyn, Jeremy

Crausby, Mr David

Creasy, Stella

Cruddas, Jon

Cunningham, Alex

Cunningham, Mr Jim

Cunningham, Tony

Dakin, Nic

Darling, rh Mr Alistair

David, Mr Wayne

Davidson, Mr Ian

Dobson, rh Frank

Docherty, Thomas

Dowd, Jim

Dugher, Michael

Eagle, Ms Angela

Edwards, Jonathan

Elliott, Julie

Ellman, Mrs Louise

Engel, Natascha

Evans, Chris

Field, rh Mr Frank

Fitzpatrick, Jim

Flynn, Paul

Fovargue, Yvonne

Francis, Dr Hywel

Gapes, Mike

Gardiner, Barry

Gilmore, Sheila

Glass, Pat

Glindon, Mrs Mary

Greatrex, Tom

Green, Kate

Greenwood, Lilian

Gwynne, Andrew

Hanson, rh Mr David

Harman, rh Ms Harriet

Havard, Mr Dai

Hepburn, Mr Stephen

Heyes, David

Hillier, Meg

Howarth, rh Mr George

Hunt, Tristram

Irranca-Davies, Huw

Jamieson, Cathy

Jarvis, Dan

Johnson, Diana

Jones, Graham

Jones, Mr Kevan

Jones, Susan Elan

Joyce, Eric

Kendall, Liz

Khan, rh Sadiq

Lammy, rh Mr David

Lazarowicz, Mark

Lloyd, Tony

Love, Mr Andrew

MacNeil, Mr Angus Brendan

MacShane, rh Mr Denis

Mactaggart, Fiona

Marsden, Mr Gordon

McCann, Mr Michael

McCarthy, Kerry

McClymont, Gregg

McDonagh, Siobhain

McDonnell, John

McFadden, rh Mr Pat

McGovern, Alison

McKechin, Ann

McKinnell, Catherine

Mearns, Ian

Mitchell, Austin

Moon, Mrs Madeleine

Morden, Jessica

Morrice, Graeme


Morris, Grahame M.


Murray, Ian

Nandy, Lisa

Nash, Pamela

O'Donnell, Fiona

Onwurah, Chi

Osborne, Sandra

Pearce, Teresa

Perkins, Toby

Pound, Stephen

Raynsford, rh Mr Nick

Reed, Mr Jamie

Reeves, Rachel

Reynolds, Emma

Reynolds, Jonathan

Robinson, Mr Geoffrey

Roy, Lindsay

Ruane, Chris

Ruddock, rh Joan

Sarwar, Anas

Seabeck, Alison

Sharma, Mr Virendra

Shuker, Gavin

Slaughter, Mr Andy

Smith, rh Mr Andrew

Smith, Owen

Spellar, rh Mr John

Stuart, Ms Gisela

Thomas, Mr Gareth

Thornberry, Emily

Timms, rh Stephen

Trickett, Jon

Turner, Karl

Twigg, Stephen

Umunna, Mr Chuka

Walley, Joan

Watts, Mr Dave

Whitehead, Dr Alan

Wicks, rh Malcolm

Wilson, Phil

Winnick, Mr David

Winterton, rh Ms Rosie

Tellers for the Ayes:

Mr David Hamilton and

David Wright


Adams, Nigel

Aldous, Peter

Amess, Mr David

Arbuthnot, rh Mr James

Bacon, Mr Richard

Baker, Steve

Baldry, Tony

Baldwin, Harriett

Barclay, Stephen

Baron, Mr John

Bebb, Guto

Beith, rh Sir Alan

Benyon, Richard

Beresford, Sir Paul

Berry, Jake

Bingham, Andrew

Binley, Mr Brian

Blackman, Bob

Blackwood, Nicola

Blunt, Mr Crispin

Boles, Nick

Bradley, Karen

Brady, Mr Graham

Brake, rh Tom

Bray, Angie

Brazier, Mr Julian

Brine, Mr Steve

Brooke, Annette

Browne, Mr Jeremy

Bruce, Fiona

Bruce, rh Malcolm

Burley, Mr Aidan

Burns, Conor

Burns, rh Mr Simon

Burstow, Paul

Burt, Lorely

Byles, Dan

Cairns, Alun

Campbell, rh Sir Menzies

Carmichael, rh Mr Alistair

Carmichael, Neil

Carswell, Mr Douglas

Cash, Mr William

Chishti, Rehman

Clark, rh Greg

Clarke, rh Mr Kenneth

Clifton-Brown, Geoffrey

Colvile, Oliver

Cox, Mr Geoffrey

Crabb, Stephen

Davey, Mr Edward

Davies, Glyn

de Bois, Nick

Dinenage, Caroline

Djanogly, Mr Jonathan

Donaldson, rh Mr Jeffrey M.

Dorrell, rh Mr Stephen

Doyle-Price, Jackie

Duddridge, James

Duncan, rh Mr Alan

Ellis, Michael

Ellison, Jane

Eustice, George

Evans, Jonathan

Fabricant, Michael

Fallon, Michael

Field, Mr Mark

Foster, rh Mr Don

Francois, rh Mr Mark

Freeman, George

Freer, Mike

Fullbrook, Lorraine

Fuller, Richard

Gale, Mr Roger

Garnier, Mr Edward

George, Andrew

Gillan, rh Mrs Cheryl

Glen, John

Goldsmith, Zac

Grant, Mrs Helen

Gray, Mr James

Grayling, rh Chris

Green, Damian

Greening, Justine

Griffiths, Andrew

Gummer, Ben

Gyimah, Mr Sam

Halfon, Robert

Hammond, rh Mr Philip

Hancock, Matthew

Hands, Greg

Harper, Mr Mark

Harris, Rebecca

Hart, Simon

Haselhurst, rh Sir Alan

Heald, Oliver

Heath, Mr David

Heaton-Harris, Chris

Hemming, John

Henderson, Gordon

Hendry, Charles

Hinds, Damian

Hoban, Mr Mark

Hollingbery, George

Hollobone, Mr Philip

Hopkins, Kris

Howell, John

Hughes, rh Simon

Huppert, Dr Julian

James, Margot

Javid, Sajid

Jenkin, Mr Bernard

Johnson, Gareth

Jones, Andrew

Jones, Mr David

Jones, Mr Marcus

Kawczynski, Daniel

Kelly, Chris

Knight, rh Mr Greg

Kwarteng, Kwasi

Lamb, Norman

Latham, Pauline

Leadsom, Andrea

Lee, Dr Phillip

Leech, Mr John

Lefroy, Jeremy

Leigh, Mr Edward

Leslie, Charlotte

Lewis, Brandon

Liddell-Grainger, Mr Ian

Lidington, rh Mr David

Lilley, rh Mr Peter

Lopresti, Jack

Lord, Jonathan

Loughton, Tim

Luff, Peter

Lumley, Karen

Maude, rh Mr Francis

Maynard, Paul

McCartney, Karl

McLoughlin, rh Mr Patrick

Menzies, Mark

Metcalfe, Stephen

Miller, Maria

Mills, Nigel

Milton, Anne

Mordaunt, Penny

Morgan, Nicky

Morris, Anne Marie

Morris, James

Mosley, Stephen

Murray, Sheryll

Murrison, Dr Andrew

Neill, Robert

Newmark, Mr Brooks

Newton, Sarah

Nokes, Caroline

Nuttall, Mr David

Offord, Mr Matthew

Ollerenshaw, Eric

Osborne, rh Mr George

Ottaway, Richard

Paice, rh Mr James

Parish, Neil

Patel, Priti

Paterson, rh Mr Owen

Penning, Mike

Percy, Andrew

Perry, Claire

Phillips, Stephen

Pincher, Christopher

Poulter, Dr Daniel

Pugh, John

Raab, Mr Dominic

Randall, rh Mr John

Rees-Mogg, Jacob

Reid, Mr Alan

Robathan, rh Mr Andrew

Robertson, Mr Laurence

Rosindell, Andrew

Rudd, Amber

Ruffley, Mr David

Rutley, David

Sandys, Laura

Scott, Mr Lee

Selous, Andrew

Shannon, Jim

Shapps, rh Grant

Sharma, Alok

Shelbrooke, Alec

Skidmore, Chris

Smith, Henry

Smith, Julian

Smith, Sir Robert

Soames, rh Nicholas

Soubry, Anna

Spencer, Mr Mark

Stanley, rh Sir John

Stevenson, John

Stewart, Bob

Stewart, Iain

Stewart, Rory

Streeter, Mr Gary

Stride, Mel

Stuart, Mr Graham

Stunell, Andrew

Sturdy, Julian

Swales, Ian

Swayne, rh Mr Desmond

Swinson, Jo

Swire, rh Mr Hugo

Syms, Mr Robert

Thurso, John

Tomlinson, Justin

Truss, Elizabeth

Turner, Mr Andrew

Tyrie, Mr Andrew

Uppal, Paul

Vaizey, Mr Edward

Vara, Mr Shailesh

Vickers, Martin

Walker, Mr Charles

Walker, Mr Robin

Wallace, Mr Ben

Walter, Mr Robert

Watkinson, Angela

Weatherley, Mike

Webb, Steve

Wharton, James

Wheeler, Heather

Whittaker, Craig

Wiggin, Bill

Williams, Stephen

Williamson, Gavin

Willott, Jenny

Wilson, Mr Rob

Wilson, Sammy

Wright, Jeremy

Wright, Simon

Young, rh Sir George

Zahawi, Nadhim

Tellers for the Noes:

Mr Robert Goodwill and

Miss Chloe Smith

Question accordingly negatived.