Another reason why the Queen Mother was short of cash is that she is thought to have placed £19 million into a trust fund for her great-grandchildren. Some people have disputed that figure but according to a well-sourced report in The Times, Princes William and Harry would share a £4.9 million payday on their 21st birthday.27 The financial benefit of the trust was that if the Queen Mother survived for seven years, her great-grandsons would receive the money tax free. The trust was set up in 1994; she died in 2002.
Although the Queen Mother is often portrayed as a spendthrift who had but the haziest notion of organising her finances, as a scion of one of wealthiest aristocratic family in the country, she could not have been unaware of the effect of death duties and the need for inheritance tax planning. Before she reached the age of fifty she had lost her father (the 14th Earl of Strathmore), her mother (the countess of Strathmore) as well as four brothers (including Patrick, the 15th Earl of Strathmore) and one sister. David, the surviving brother whom she was most close to and who happened to be managing director of the investment bank Lazard Brothers, regularly gave her financial advice. Without trusts and other conduits of inheritance tax planning, the Bowes Lyon estate - including the Castle of Glamis in Scotland, the family seat for nearly seven hundred years, and the St Paul's Walden Bury, the country home in Hertfordshire - could have been decimated by death duties. In a letter to her friend Osbert Sitwell, she let slip her interest in such matters when she gave as one of the main reasons why she loved Rhodesia was the absence of any inheritance tax.28
Her concern about high taxes was part and parcel of her wider political outlook which her friend Woodrow Wyatt once described as "much more pro-Conservative than the Queen or the Prince of Wales." According to her official biographer, she was annoyed with some aspects of the taxation policy of the Labour government of Harold Wilson and particularly disliked its new selective employment tax. There were Labour politicians with whom she got on well - James Callaghan and also Ernest Bevin - but as an aristocratic Edwardian lady who was bought up in a traditionally Conservative family, she could never escape her ideological inheritance. When the first Labour government came to power in 1924, she wrote privately about how their values were so diametrically opposed to her own.29
What she liked was not tax and spend but rather spend and not worry about the tax. This approach to life was best illustrated in the purchase of the one house she ever owned - the castle of Mey. She would never have bought it but for the premature death of George VI which left a void in her life. Although her role in giving him the confidence to be king throughout the trauma of the abdication has been widely acknowledged, it is often forgotten how much she relied on him to be taught the protocol of royal life and metamorphose from being a commoner to a queen-empress. She saw him as her mainspring, once writing to her brother David that she could not envisage life without the king. In her deep grief she needed a place with no association with her husband where she could be alone.
She found it in one of the most remote parts of Scotland - the Pentland Firth, six miles west of John O’Groats and fourteen miles south of the Orkney Islands. Her friends Clare and Doris Vyner owned a house there and on a visit a few months after the death of her husband, she discovered a romantic-looking castle by the sea. It stood in a wonderful location overlooking the Orkneys but it was near derelict after years without maintenance and a roof that had not survived a recent storm. On learning that it might soon be demolished, she became determined to save it. The owner, Captain Imbert Terry, offered it for free but since it was considered improper for a member of the royal family to accept such a gift they agreed on a nominal sum of £100. Later she bought some more land along the coast for £300.
The real cost of the property was not the land but its restoration. A decrepit, 16th century Z-plan castle had to be turned into a habitable dwelling for a fifty-two-year-old dowager queen consort. This would require considerable capital. At first she kept her costly plans under wraps. She did not break the news to her treasurer Arthur Penn until early August and disguised the purchase to Queen Mary as an act of heritage preservation.30
Such was the scale of the restoration work - involving a new dining room and bathrooms and the installation of electricity - that it would be another three years before she spent her first night in the castle. From 1955 until the summer of 2001 she visited the castle every August entertaining her friends and courtiers - some of whom got up to spirited activity in the isolated castle. Mey became her Mustique. One of the rooms was even called Princess Margaret's Bedroom, although her daughter never set foot in the place, reportedly calling it "Mummy's draughty castle."
To ward off the draught and add a bit of warmth, she commissioned a spectacular tapestry with her coat of arms for the dining room and hung on the drawing room wall a 16th century Flemish wool tapestry. As she got frailer, she had to rebuild the lift in the turret leading to her master bedroom with it panoramic view of the Pentland Firth. No one knows exactly how much money was spent on all the restoration and refurbishment but over five decades it must have approached seven figures. Another burden was the never-ending maintenance costs. Damp was a constant headache since the castle was built on porous sandstone and the roof continued to leak despite new leadwork.
In 1996 she found a solution to the rising maintenance costs by setting up the Castle of Mey Trust to look after the house. In return for handing over the deeds to a 1,800 acre estate complete with a prize herd of Aberdeen Angus cattle, she was spared all the running costs and allowed to stay for a small rent in the castle every summer. In June 1996 she appointed her friend and former equerry, Ashe Windham, chairman of the trustees who also included her grandson Prince Charles. The charitable trust is designed to benefit the local community and economy.
The other advantage of the trust is that it may have saved her estate a fortune in tax. If she had still owned the castle at her death it would not just have been liable to inheritance tax at 40% (provided it was not left to the Queen) but it would have been subject to capital gains tax at a similar rate. Considering the gain in the property from a base figure of £400 to a final value well into the millions, the tax would have been several hundred thousand pounds. So, it was from a tax perspective an astute move to put the castle into a trust, although in fairness it also benefited the nation in that she took steps for the castle to be opened to the public – which it is today.
All we know for certain about her final will and testament are the names of its three executors: Nicholas Assheton, her last Treasurer, David Cospatrick, the Earl of Home and scion of the a family with long links to the Queen Mother, and Marshom Boyd Carpenter, another member of a family with close ties to the Windsors. Their main task was to distribute the contents of her estate although the Queen Mother had actually begun the process on her deathbed. On Good Friday 2002 - a day before she passed away - she gave to her page Leslie Chapell, a pair of cuff links and to her dresser and carer Jacqui Meakin, a brooch with her "ER" emblem on it. A Buckingham Palace spokesman later confirmed that she made "certain bequests to members of her staff." William Tallon, her faithful valet over many decades, would almost certainly have been among the other staff beneficiaries.
Before her death she also gave instructions for the distribution of her stable of horses. In the last week of her life she telephoned her racing manager, Michael Oswald, to say goodbye and give him a list of things to do. A little later she rang Princess Anne asking her to take some of her horses.
A clue to what might have happened to her jewellery is given in a remarkable wartime letter she wrote to the then Princess Elizabeth. In June 1944 - when London was under daily V1 bombardment and Buckingham Palace had narrowly missed an attack that hit the nearby Guards Chapel - Queen Elizabeth specified that in the event of her death all her possessions should be divided between her two daughters in a right and proper manner.31 Of course, by the time of the Queen Mother's passing, Princess Margaret was already dead and so all the jewellery would have reve
rted to Elizabeth.
It was also widely rumoured at the time that the Queen had decided that the most important of her mother's paintings and works of art should be transferred to the Royal Collection. After much speculation about the fate of the Queen Mother's estate, Buckingham Palace felt obliged in May 2002 to issue a short statement:
“Queen Elizabeth the Queen Mother has bequeathed her entire estate (which mainly comprises the contents of her houses) to the Queen. In her will, she asked the Queen to make certain bequests to members of her staff and these will be subject to Inheritance Tax in the normal way.”
This statement glossed over the fact that under the sovereign to sovereign exemption almost all of the multi-million pound estate passed to the Queen tax free. But it confirmed that:
“The Queen has decided that the most important of Queen Elizabeth’s pictures and works of art should be transferred to the Royal Collection. Some of these items, including works by Monet, Nash and Carl Faberge, from Queen Elizabeth’s collection will be on display in the ‘Royal Treasures’ exhibition, which is due to open at the new Queen’s Gallery, Buckingham Palace, on 22 May [2002].”
At the time, it was far from clear how many of the art works were actually transferred to the Royal Collection and put on permanent display to the public. When a search was made on their publicly available on-line catalogue, there was no record, for instance, of the Monet painting “Study of Rocks”. The complicated situation was later clarified by the Senior Curator of Paintings who explained that Royal Collection On-line is based on a wider database of the comprehensive computerised inventory of the contents of the royal palaces, although she did acknowledge that there is “no single comprehensive catalogue…Collection on-line is not a comprehensive inventory of the Royal Collection but every year we [are] adding more entries to the website.”32 In the eyes of some more sceptical palace critics, a certain ambiguity about the contents of the Royal Collection might actually suit members of the royal family. According to Jon Temple in his book “Living off the State”: "even the Palace may not know or at least would probably find it convenient not to know."33
Some credence to the suspicion that some of the more valuable items were retained away from public view was given by the former Labour MP and government minister Chris Mullin. In his diaries he records a visit to Clarence House in November 17, 2005 for a private reception with Prince Charles who took over the Queen Mother's residence after her death. At the end of the two hour meeting he was allowed a glimpse of the dining room where he discovered that the walls were “crammed” with paintings:
“A veritable art gallery. A Sickert of George V at the races, an unusual Monet depicting a stark granite mountainside, various portraits of the Queen Mother, a large one of her as a young woman hangs over the fireplace, a series of bleak paintings of Windsor commissioned at the outbreak of war because the King and Queen feared that the castle would be destroyed and wanted to preserve the memory.”34
At first sight it seemed likely that these items were part of the Royal Collection but not on permanent public show. But there seemed little point in donating the items to the Royal Collection if they remain in the royal residence of the Prince of Wales and the public is unable to see them. Three and half years after the Queen Mother’s death, it would have been expected that some attempt would be made to put such an important works as Monet's "Study of Rocks" on permanent display.
After further inquiries were made to Royal Collection Trust, the Senior Curator of Paintings confirmed that the Monet painting and indeed the whole of the Queen Mother’s collection belonged to the Queen – “Her Majesty The Queen inherited the collection which belonged to Her Majesty Queen Elizabeth the Queen Mother and as such it is the private property of Her Majesty [author’s italics]. The Royal Collection Trust cares for the Collection on behalf of the Queen. The painting by Monet is on display at Clarence House.”35
Limited public access to Clarence House is now available. Between August 1 and 31 the public can enjoy a sixty-minute tour of the rooms – including according to its website "outstanding 20th century paintings such as important works by John Piper, Graham Sutherland, WS Sickert and Augustus John" - for the cost of a £9.50 entrance ticket or £35 if they want a private guide.
13.A ROYAL CAR BOOT SALE - 2006
“David sells everything”
Lord Snowdon’s reported comment on his son’s penchant for selling
In June 2006, a full four years after probate had been granted to Princess Margaret's executors, the saga of her estate took an unexpected turn. The £7.6 million legacy was liable to inheritance tax at 40% which meant a £3 million bill for its two main beneficiaries, Lord Linley and Lady Sarah Chatto. To pay it, they said they needed to sell off their mother’s most valuable possessions, including the tiara she wore on her wedding day and the silver Fabergé clock that sat on her bedroom table. The auction was set for June 13 and 14 at Christie’s central London salesroom.
The renowned auction house whose first sale took place during the reign of King George III stood in the heart of St James's at 8 King Street - barely a stone's throw from Margaret's childhood home at 145 Piccadilly. With its long pedigree in organising royal auctions (including the sale six months earlier of the Duke of Gloucester’s personal artefacts), Christie’s was delighted to host another prestigious - and no doubt highly profitable - sale. "It was the first time in history that the private jewellery collection of the sister of a reigning sovereign is offered for sale” trumpeted their press office although they were quick to emphasise that "the jewellery offered is neither part of the Crown Jewels nor part of the Royal Collection."
So, when it came to promoting the sale and creating that vital buzz that elevates prices, they really pushed the boat out. An exhibition of ninety items of jewellery - whose highlights featured the famed wedding tiara and the Queen Mother's diamond brooch - was put on the road being shown first at Balmoral Hotel, Edinburgh in early May and soon after at the Earl of Harewood's ancestral pile Harewood House, Yorkshire and Wilton House, near Salisbury before going on a world tour to Geneva, Moscow, Hong Kong and New York. Rich overseas buyers were clearly in their sights.
When the full collection of over eight hundred items was put on show at the London auction rooms on the weekend before the sale, it drew huge crowds, the like of which had not been seen at Christie’s since the Queen’s diamonds were put on display before the coronation. The press and television cameras were allowed in too prompting even Channel 4 News to run several reports on the sale of the century. It was also announced that the auctioneer would be Francois Curiel, chairman of Christie’s Europe, who promised that "we will stage an auction that pays tribute to Princess Margaret's glamorous style and beauty."
Not everyone, however, was happy about the auction. A day before Curiel opened the bidding, Kenneth Rose, the historian and friend of Margaret, wrote in The Daily Telegraph “there is something melancholy - isn't there? - about turning over the possessions of the well-remembered dead” before suggesting that some of the wedding gifts should not have been included and that the bridegroom might also share this view.1 In fact, Lord Snowdon - according to his biographer - was "furious" about the sale of some of the wedding presents which he regarded as much his as hers. He even wrote to the chairman of Christie’s UK, Dermot Chichester, querying the right of his son to sell some items. He was later quoted as saying in an apparent reference to his son's penchant to monetise property: "David sells everything."2 By all accounts, Snowdon’s disapproval was not to the sale itself but rather its extent - but in the fullness of time any family tensions were soon amicably reconciled.
The Queen also reportedly intervened to register her concern but in this case it related to the grey area between public and private gifts. She is said to have asked Lord Linley to make a clear distinction between goods his mother had received in an official capacity and those that had been personal gifts from family and friends. One senior royal official told the Sunday Telegra
ph: "The Queen has made sure that the sellers are aware of the issue and the various implications involved…It is up to Princess Margaret's beneficiaries what they do with her estate. However, the Queen made it clear from early on that, if there were any items given to Princess Margaret in an official capacity, and then any proceeds should go to charity."3
Prompted in part by this intervention, it was decided that the revenue from the sale of forty-seven lots should go to charitable causes. The two catalogues had to be altered so that the titles of the charitable items were highlighted in blue and Lord Linley felt obliged to issue a statement saying how pleased he was to be able to support such worthy causes as the Stroke Association and SOS Children's Villages UK. (His mother had died following a stroke.) This gesture helped to dampen some of the press criticism but apart from a few passing references to "a silver water jug donated by Bolton Borough Council" or "a cigar box from the King of Cambodia" no journalist made a detailed study of the items allocated to charity.
When it comes to considering the forty or so charity items and distinguishing personal gifts from official ones, it is useful to refer to the palace’s Guidelines and Procedures Relating to Gifts issued in March 2003. It states that gifts are classed as personal when “they are: given by people whom the Member of the Royal Family knows privately and not during or in connection with an official engagement or duty; given by public bodies, businesses or private individuals with whom the Member of The Royal Family has an established relationship, such as Warrant Holders, on the occasion of a marriage, birth, birthday or other notable personal occasion (including Christmas), and where the value of the gift is less than £150 (if a gift is given where there is no established relationship, other than on a notable personal occasion or is over £150 in value, the gift should be classified as official).”
Royal Legacy: How the royal family have made, spent and passed on their wealth Page 24
