What needs to be renovated at Buckingham Palace? Who’s paying? Is it worth it?
Buckingham Palace. (William Fawcett/iStock)
The Queen’s officials are nothing if not organized. So before announcing a massive 10-year, $700-million renovation to Buckingham Palace, they had a cornucopia of diagrams, photos and explanations of the intended work ready, so they could plaster the royal website and social media feeds with details.
Buckingham Palace’s reservicing will take 10 years and include an overhaul of essential systems such as the pipework https://t.co/I0cMyfMbX9 pic.twitter.com/mCst4KB6wn
— The Royal Family (@RoyalFamily) November 18, 2016
They knew to expect push-back from those who see such a massive refurbishment as a waste of money. Soon enough, Twitter was filled with such comments.
On Children In Need day, the Royals get handed £369m of taxpayer money to refurbish Buckingham Palace. Is this a ****ing joke?
— Piers Morgan (@piersmorgan) November 18, 2016
But what needs to be renovated? Why is it taking 10 years and who is paying for it? There are a multitude of questions, so here are nine, along with answers, regarding the Buckingham Palace re-do:
A: In a nut shell, this is a palace filled with royals, packed with staff and crammed with priceless treasures. For this, I’m creating bullet points from the handy-dandy Buckingham Palace Reservicing Programme Summary Report (You thought I was exaggerating the royal household’s preparations, didn’t you?):
A: It’s one of those places that looks good in the brochure, but don’t look too closely in the basement. The ornately gilded surfaces of the palace are in decent shape, but the utilities hidden behind walls, and under the floors, are an outdated, dangerous nightmare. In the last few years, experts have been poring over the building, peering behind walls, and totting up the problems.
The report is grim, according to Sovereign Grant Review (more on that review later):
“As the Palace’s electrical cabling, plumbing and heating have not been updated since the 1950s, in the aftermath of the Second World War, the building’s infrastructure is now in urgent need of an overhaul to avoid the very real danger of catastrophic failure leading to fire or flood, and incalculable damage to the building and priceless works of art in the Royal Collection.”
The condition of the palace and reservicing requirement
The technical assessments established that there are a series of very old (over 60 years), fragile systems with a high risk of failure that need to be replaced as a matter of urgency over the next two years (2017-19). These include Vulcanised India Rubber electrical cabling, electrical panels, distribution boards, generators, boilers, drainage pipework and data systems. Not carrying out these works would come with significant risks, including:
(Hint: When reports use words like “danger,” “catastrophic failure” and “incalculable damage,” it’s fair to say that the writers want the work to start tomorrow, if not today.)
A: Hopefully that name will change—how about Buckingham Palace 2.0?—but one step at a time.
The Reservicing Programme will replace:
A: For this, I need to do a dive into royal finances (remember that Sovereign Grant from earlier). Stick with me.
The Crown Estate is a vast property portfolio tracing back to the Conquest in 1066. It is “owned by the Monarch in right of the Crown. This means that the Queen owns it by virtue of holding the position of reigning Monarch, for as long as she is on the throne, as will her successor,” says the Crown Estate’s website. It owns Regent Street in London and other prestigious parts of Britain.
Run by professional managers, it’s a cash cow. But not for the royal family.
As the Crown Estate says, “Since 1760, the net income of The Crown Estate has been surrendered to the Exchequer by the Monarch under successive Civil List Acts, passed at the beginning of each reign.” In other words, the monarch gets stable annual funding, the government gets the rest of the profits. That was once a good deal for all, but slowly, as the Crown Estate’s holdings increased in value, the balance shifted until now, the government takes the lion’s share.
Until recently, the royal household states, its funding came in four parts:
(Notice there’s nothing about the Queen’s salary? That’s because she doesn’t have one. This funding is to pay for her staff, official expenses and palaces. Furthermore, she pays for expenses of other royals out of her own personal wealth, while Prince Charles pays for his growing family from the ancient Duchy of Cornwall profits.)
The problem
Those separate pots of financing were restrictive. Royal officials couldn’t shuffle savings from, say, royal travel, into the maintenance pot to pay for a new roof. Also, every time the Queen needed to update the Civil List to stay on top of inflation, headlines would scream about how much money was going into her pocket. So royal officials got really good at saving money everywhere they could, and spending as little as possible.
Don’t believe me? This is what the National Audit Office said: Between 1991-92 and 2011-12 the Household reduced net expenditure from the equivalent of £72.6 million to £32.9 million in real terms, a reduction of £39.7 million (55 per cent). As Figure 6 overleaf shows the most significant reduction in the Household’s net expenditure in this period occurred between 1991-92 and 2000-01, when spending reduced by £34 million in real terms.
That system of payments led to a growing backlog of issues. In 2009, a hunk of the facade of Buckingham Palace fell, nearly missing a police officer and Princess Anne’s car. (Don’t think Buckingham Palace is alone: the British Parliament needs billions spent on it; the Canadian Parliament is in the midst of a retrofit so long, and so expensive, that it’s hard to remember exactly when it started.)
As every homeowner knowns, keeping up with regular maintenance is hard enough. And every now and again, maintenance isn’t enough: the place needs a full reno.
A new system
In 2011, the old financing system was consolidated by the Sovereign Grant Act into one pool of financing: “The act set the initial grant for 2012-13 at £31 million. For subsequent years the level of the grant has been based on a proportion of The Crown Estate’s net income, which initially has been set at ‘15% of the net income of The Crown Estate in the year two years prior to the funding year.’ ”
In recent years, experts have analyzed just how back the backlog has gotten.
Remember that Sovereign Grant Review? Well, it’s an analysis of how well the Sovereign Grant is going. It’s done by the royal trustees, who are, well, kinda important (the Prime Minister, the chancellor of the exchequer and the keeper of the Privy Purse).
The report states: “Since the introduction of the grant, the Royal Household has committed to allocate at least 50% of the annual increase in the grant to property maintenance in order to reduce the backlog in essential maintenance. Despite this commitment being met, the latest Condition Assessment survey of the Occupied Royal Palaces Estate highlighted that 45% of the Estate was below target condition, which is an increase of 6% since the last survey at 31 March 2012 (39%).
“The works needed for the reservicing of Buckingham Palace have been considered as a separate, discrete element of the property maintenance 10 year plan due to the programme scope being substantially different to the other priorities for property maintenance investment in the period 2016-21.”
It’s going to cost around $700 million, tax included for a 10-year plan. “The estimated capital cost of £369m will be funded by a temporary uplift in the Sovereign Grant, from 15 per cent to 25 per cent of Crown Estate net income,” the press release states.
Historic renovations are expensive. It’s a Grade I-listed property (the highest heritage grade), so contractors can’t just go down to Home Depot to pick up supplies. Everything has to be approved and vetted. And it’s not like they can strip the rooms back to studs.
A: Are taxpayers actually paying for it? It’s a matter of interpretation, since the money comes from the Crown Estate through the government’s books and then back to the monarch. What is certain is that $700 million isn’t going to the government.
For those asking why the Queen shouldn’t pay for it, the answer is simple: this isn’t the Queen’s personal palace. She can’t rent out rooms, or sell off a Rembrandt or two to pay for the renovation. She lives there as head of state. Her family lives there as members of the royal family. It’s like asking a prime minister to pay to redo the plumbing at 10 Downing Street.
A: Nope. “The most critical work will begin in April 2017 and Her Majesty will remain in residence throughout,” the press release said. Also, she’s not always at her London residence. She spends a lot of time at Windsor Castle, and her two private estates of Balmoral and Sandringham.
A: Pretty much as it looks now, given it’s a listed heritage property. But behind the scenes, it promises to be a lot more efficient.
A: Yes. Also, what’s the alternative: to let it fall into ruins?