Labour for a Republic urges party to rein in royal spending ahead of coronation

Labour for a Republic has urged the party to “get a grip” on the royal finances and slammed current funding arrangements as an “insult to ordinary working people” ahead of the coronation of King Charles III next month.

In a letter sent today to Shadow Chancellor Rachel Reeves and public accounts committee chair Meg Hillier, the campaign group argued that the next Labour government “will be an opportunity to address the many examples of Tory mismanagement of public finances”.

“Recent press reports have highlighted how this extends to the way in which the monarchy is financed,” the letter, sent by the group’s chair Nick Wall, continued.

The group is calling for the sovereign grant scheme – a taxpayer-funded payment paid to the Royal Family each year – to be reviewed and condemned the scheme, which was introduced by the coalition government, as a “colossal misjudgement”.

The grant made to the royal family is based on the profits of the Crown Estate, a property business owned by the King but run independently.

The monarch normally receives 15% of the profits from the previous two years, but it was agreed that, from 2017, they would receive 25% for the following ten years. The government retains the remainder of the profits.

If profits fall, the monarch receives the same grant as the year before, with the total topped up by the Treasury. The grant for 2022/23 is £86.3m, the same as in 2021/22.

In his letter to Reeves and Hillier, Wall also highlighted the revenue the royal family receives from the “publicly-owned Duchies of Cornwall and Lancaster”.

He wrote: “These arrangements are completely unjustifiable in any context, but at a time when households are having to choose between heating and eating and both public and private sector workers are experiencing real-term pay cuts, the special status afforded the monarchy is an insult to ordinary working people.”

“We do not expect details of how Labour will address the monarchy’s status as an economic anomaly, but we do seek your reassurance that the monarchy will not be exempt from the necessary and urgent scrutiny of public finances,” Wall added.

Yet Keir Starmer has taken a supportive stance towards the monarchy, telling MPs during a speech following King Charles’ ascension to the throne last year: “The whole House, indeed, the whole country, will join today to wish him a long, happy and successful reign.”

The Labour leader attended the first ‘dine and sleep’ event of the King’s reign earlier this month, with the new monarch hosting a number of well-known guests for dinner and an overnight stay at Windsor Castle.

Commenting on his letter to Reeves and Hillier, Wall said: “As monarchy receives public funds, what it does with our money should be subject to the same scrutiny as all other parts of government.”

“The monarchy is a state institution and its financial affairs must therefore be transparent and its financial conduct beyond reproach,” he added.

King Charles’ coronation will take place on May 6th, with the event being paid for by the government. The exact cost of the coronation is yet to be announced. The committee organising the event reportedly estimated it could cost £100m, though that has not confirmed.

According to polling from YouGov, 51% of adults do not think the coronation should be funded by the government, compared to 32% who do. Opposition to the government covering the cost of event is highest among younger voters, with 62% of respondents aged 18 to 24 saying the government should not pay.

Writing in the Guardian last week, Clive Lewis argued that an incoming Labour government could “make a stand” and “embrace rather than resist the change symbolised by the crowning of a new King”.

The Labour backbencher declared that a “refusal even to countenance reform of the monarchy is an admission that the party lacks a vision for the country’s future and wants to stay in the past”.

“A reformed monarchy, scaled down in size and cost, less opaque, more open and fit for purpose, once again a symbol of service not servitude, could symbolise the renewed Britain the party needs to create,” Lewis wrote.

But the Royalists UK campaign group hit back publicly at Labour for a Republic, stating that the Royal Family was a net contributor to the British economy. “If you classify the Duchies as public land – which they aren’t, and they are taxed – then the Monarchy funds itself thrice over every year.”

The Labour Party and Meg Hillier MP have been contacted for comment.