Royal Legacy: How the royal family have made, spent and passed on their wealth

by McClure, David

  One of his long-standing crusades has been to modernise the royal family, famously declaring in 2000: "it's odd - being the 21st century at a time of fundamental constitutional reform to be saddled with a 19th century monarchy."6 In the past he has supported the pressure group Republic in its campaign for an elected head of state and as a backbencher in the Commons asked many pointed questions about the royal finances - whether it was the cost of the sovereign's travel arrangements or what happened to gifts to the royal family. His ire was particularly directed at the Queen's many financial privileges:

  "Why should the one of us who happens to be monarch benefit from a highly advantageous tax position - exempt from inheritance tax and capital gains tax, able to determine what level, if any, of income tax is paid, exempt from the requirement to publish details of what is bequeathed, and so on."7

  In early 2009 came a further bombardment of critical questions aimed at Jack Straw. First on January 12 he asked the Secretary of State for Justice:

  "what discussions his Department and its predecessors have had with (a) Buckingham Palace and (b) lawyers acting for the Royal Family on the publication practice on Royal Wills in the last 10 years; and if he will make a statement?"8

  But the Justice Secretary explained that such matters were the responsibility of the Family Division and denied any direct involvement - although it was slightly qualified with this rider:

  "So far as I am aware, [author’s italics] there have not been any discussions between my Department and its predecessors with Buckingham Palace or lawyers acting for the Royal Family in relation to the policy or practice on the publication of royal wills.”

  Then on January 22 the member for Lewes tried a different tack:

  “To ask the Secretary of State for Justice:

  (1) If he will publish sealed Royal Wills in cases where such Wills were sealed prior to 1990.

  (2) If he will review his policy on the practice of allowing Royal Wills to be sealed.”9

  Jack Straw responded with the normal straight bat to the first part of his question:

  “The power to seal and unseal all wills is exercised by the court. The decision whether or not to permit inspection of a will of a senior member of the Royal Family that has been sealed by the court is a matter for the President of the Family Division upon application.”

  But the second part elicited a significant new piece of information:

  "The President is currently considering setting up a committee to review the Non-Contentious Probate Rules 1987, which will include consideration of the current rules relating to the inspection and/or publication of Wills. The power to make new rules is vested in the President with the concurrence of the Lord Chancellor."

  Some media commentators took this surprise announcement to mean that that in the future the wills of senior royals – including Prince Charles and the Queen - could be made public. Baker very much welcomed the news. "There should be one rule that is the same for everyone," he told the Times. "If other people's wills have to be published so should those of the royal family who are in receipt of large amounts of public money."10 He assumed that the Ministry of Justice had found that there was no constitutional justification for sealing wills - and the Brown case might have prompted this realisation. "It is a matter of equity and transparency that people are able to see wills and it is quite wrong that the Royal Family is treated differently," he informed the Express on Sunday. "They pass on gigantic sums of money without paying death duties. If we had the wills made public there might be fresh questions about whether they need quite so much money from the Civil List."11

  Nothing happened about the review for five months and then out of the blue on July 24 the Judicial Communications Office issued a news release entitled "Working Group set up to revise non-contentious probate rules." Included in its remit was the issue of sealed wills.

  The announcement was a masterpiece in news management. By July 24 parliament had long since risen for the summer recess and so there were no danger of embarrassing questions from the backbenches. It was slipped out late on a Friday and so it was missed by all of the national newspapers.

  The only story in the lengthy press release on the reform of non-contentious probate rules was the commitment to review royal wills but this was hidden in the body of the text and couched in the most round-about language:

  "The President of the Family Division, Sir Mark Potter, announced today that he will be establishing a working group to consider the revision of the Non-Contentious Probate Rules 1987…The publication and disclosure of wills, including those of the Royal Family, has on occasion been a subject of some interest, and the Committee’s remit will extend to consideration of this topic.”

  Although the committee was expected by some to report within a couple of years, more than four years went by without a word appearing. We now know from court records that as early as November 2010 a copy of the so-called “practice direction” on the sealing of royal wills (the “quite lengthy document” referred to in the 2008 appeal ruling) was supplied by the Attorney General’s office to the Ministry of Justice “in connection with the review the MoJ is carrying out on probate procedure.”12 Then in June 2013 a consultation document was slipped out without much publicity. Under the draft probate rules, the general public would not be able to see the will of the consort of the sovereign (or former sovereign), the child of a sovereign (or former sovereign) or a member of the royal family who is first or second in line to the throne (or the spouse or child of such a person). Although the exemption does not cover the entire royal family, it is still a long list running to over half a dozen people. At the time of writing, the draft rules had been sent to the Ministry of Justice for further consideration and there was no indication of how they might be revised or implemented.

  For his part Robert Brown had never been optimistic about the chances of the inquiry producing anything that would advance his case. By now, his main advocate in parliament, Norman Baker, had been effectively muzzled when he was made transport minister (later home office minister) in the Conservative-led coalition government and thus subject to the rules of collective responsibility and not speaking out of line. Brown’s judicial challenge in the High Court had also become becalmed due in part no doubt to the prohibitive legal costs involved. A more economical route was available through the Freedom of Information Act. Now that it had been established in court that there existed a written protocol of some sort for the sealing of the wills of Princess Margaret and other senior royals, all he needed to do was to put in a FOI request to obtain the document. At first the court service said the Ministry of Justice/HMCS did not possess the document as specified by Brown – although they later acknowledged that the Attorney General’s office had a copy as did the lawyers Farrers (although it might have been classified not as a formal practice direction but as some form of a “quite lengthy document” dated 2002.) Then in June 2009 came another blow when the Ministry of Justice announced plans to restrict access to royal documents. Under a new set of rules designed to protect particularly sensitive material, royal papers would be subject to an absolute exemption from FOI requests for twenty years.

  When he persisted with his request it was ruled invalid as the disputed information fell into the category of “royal correspondence” and was thus exempt from inspection. Challenging the decision, he found himself back at the High Court where again he won a minor victory. In December 2013 Mr Justice Philips granted him permission to seek judicial review of the refusal to allow him access under the Freedom of Information Act to documents he claims show that there was a secret judicial process for sealing royal wills. “It’s an important day for open justice,” declared Brown outside the court before adding an aside on his parentage - “Hopefully I am not a nutcase. I am either right or wrong.”13

  At the time of writing, it is unclear how long his case will run.

  16.THE BEST-LAID PLANS OF ALICE AND MEN - 2008-2010

  “She was the oldest ever membe
r of the royal family”

  Obituary of Princess Alice, Dowager Duchess of Gloucester

  When Norman Baker asked his original parliamentary question in February 2008 about the sealing of royal wills, the Justice Secretary Jack Straw replied that in the last ten years there had been only two such applications - for the estates of Princess Margaret and the Queen Mother in 2002. Yet a cursory glance of the Times’ Court Circular – or indeed its obituary page - showed that in the previous decade a third royal death had occurred - that of Princess Alice, the Duchess of Gloucester, in 2004. Although relatively little known, Alice was no minor royal. The Dowager Duchess was the Queen's aunt and died aged one hundred and two, the oldest ever member of the British royal family. Curiously, her name did not feature on the list of sealed royal wills in the probate registry. When inquiries were made at their London office as to why it was absent, a clerk explained that that their list was not necessarily comprehensive and assumed that Princess Alice's will had been sealed like those of all other senior royals.

  To confirm this assumption, the author made a request for a copy of the will in the manner of any member of the public. On payment of the customary £5 it should take less than an hour to receive a photocopy of the will that is stored in the Birmingham repository, yet when more than two hours had elapsed with no sign of a response, it seemed that the official's assumption was correct. The royal will was unavailable for public inspection. But as registry staff prepared to close down the search room for the day and the last members of the public had departed, much to the surprise of the remaining clerk at the desk a copy of the royal will miraculously arrived in his in-tray. It ran to thirty pages (thirty-two if you include the codicil) and was signed simply Alice. But there was no doubting its royal authenticity from the opening sentence that referred to Her Royal Highness Princess Alice Christabel, Dowager Duchess of Gloucester.

  Its royal provenance was further confirmed by the accompanying grant of probate document that recorded that "HRH Princess Alice" left a net estate of £569,849. Although her will was open to the public (unlike the will of her husband, Prince Henry), its very transparency raised more questions than answers. Why was the probate figure so low when she came from one the wealthiest families in Britain which possessed a jewellery collection valued at £8m? And what happened to the million-pound manor she had lived in? Seemingly by definition, it could not have been fully included in her £569,849 estate or (even allowing for the then lower property prices) the estate of her husband that was valued at £734,262. Why was her will open and his sealed? What had happened to their joint wealth?

  When Alice wed Prince Henry, the Duke of Gloucester and the third son of King George V, her parents worried whether she might be marrying beneath herself. Lady Alice Montagu-Douglas-Scott hailed from one of the grandest aristocratic families in Britain. Her father was Earl of Dalkeith, later the 7th Duke of Buccleuch and 9th Duke of Queensbury; her mother, Lady Margaret, a daughter of the 4th Earl of Bradford. She was born on Christmas Day 1901 in the family's London town house, Montagu House. Standing opposite the entrance to Horse Guards Parade, the 19th century mansion built from Portland stone and staffed by up to fifty servants was one of the very few private residences on Whitehall and it was not until after the First World War that it was pulled down to make way for the government building that eventually became the Ministry of Defence. She spent much of her childhood peregrinating between the family’s many residences: Eildon Hall, in the Scottish borders; Drumlanrig Castle, Dumfriesshire; Dalkeith House, near Edinburgh; Bowhill, outside Selkirk. Her favourite was the magnificent Boughton House, an English Versailles set in the middle of the Northamptonshire countryside, which had been first built in the late 17th century and which she once described as part palace, part village.1 The constant disruption caused by the migrations from Scotland to southern England was eased by the fact that - like the royal family - Buccleuchs had their own special train which transported not just their boisterous family of three boys and five girls but also the servants, carriages, horses and eight tonnes of luggage.

  After an unconventional early adulthood travelling the world like some Jazz Age gap year student and experiencing all the thrills of climbing Mount Kenya, illegally visiting Afghanistan dressed as a man and working her way round the Indian subcontinent from Peshawar to Lucknow, in 1935 on the urging of her father she decided it was time to settle down. Prince Henry, who was the son of her father's close comrade in the navy (George V) and the best friend of her brother in the army (Lord William Scott), proved a good match. They shared a love of the countryside, a diffident manner and a dislike of pomposity. Portly, balding and sporting a Lord Lucan-like clipped moustache Prince Harry possessed little of the good looks and charisma of his eldest brother, David, the future Edward VIII, being closer to his middle and more reserved brother Bertie, the future George VI. His bluff manner was the source of much merriment in official circles. After attending an apparently interminable performance of Tosca at the Royal Opera House, he – as the story has it - could not disguise his glee when Maria Callas at last disappeared over the ramparts: “well if she is really dead, we can all go home.”2 At home, he was known to watch children’s television programmes, Popeye the Sailor, according to his butler, being a favourite.3

  It suited both their natures that their wedding was a private, low key affair - the original public ceremony having being cancelled after the sudden death of Alice’s father. In a revealing passage in her memoirs, she describes how her father battled heroically against cancer, mindful that if he survived to a certain date, the family’s inheritance tax bill would be mitigated. In the event, he did not quite make it and they had to pay the full whack.4

  She does not say what property she inherited from her father's estate, but it is clear that her wealth was greatly boosted by various presents received on her later wedding. In the same memoirs she records how she received many gifts of jewellery and silver from King George and Queen Mary,5 omitting to mention that many of them - especially the silver items - were worth hundreds of thousands of pounds, as we saw in Chapter Six, when they were put up for auction. As was mentioned in the same chapter Alice was also a beneficiary of Queen Mary's largesse when it came to jewellery. As soon as the engagement was announced, Prince Henry was told by his mother not to buy a lot of jewellery as she had already selected many items for the bride from her own collection.6 On the wedding day Alice duly received a magnificent seven-piece suite of emerald, pearl and diamond jewellery which included a brooch that had once belonged to Queen Alexandra. There were also two pearl and emerald necklaces made from an ornate collar that had originally been the property of Queen Victoria. Clearly, the royal collection was being passed down the generations.

  After the marriage in November 1935 Prince Henry resumed his life as a soldier with the 10th Royal Hussars but the death of George V two months later and the subsequent abdication crisis dramatically reoriented his career path. With his brother George VI now on the throne and his eleven-year-old niece Princess Elizabeth still under age to be next in line, Henry was promoted to the position of Regent Designate which much to his disappointment meant retirement from active military service. This was the legal consequence of the 1937 Regency Act which laid down that if the monarch is under eighteen when he or she succeeds to the throne, a regent is automatically appointed. That person who would be named Prince of Wales must be over twenty-one and next in line to the throne.

  Thus, if the German bomb that hit Buckingham Palace in September 1940 had landed a few feet closer to the office of the king then Prince Henry would have found himself Prince Regent. The 1937 Act also provided for the incapacity of a monarch through ill health or old age. If ever a nonagenarian Queen lost her mental faculties and was deemed incapable of carrying out her responsibilities, Prince Charles as heir apparent (and over twenty-one) would be regent. Prince Henry’s changed professional circumstances did at least give him time to resume one of his great passions. Encouraged by his fa
ther who amassed an invaluable collection of stamps and his mother who put together the richest assortment of jewels of any British queen, Henry threw himself into collecting books. Since his other great passion was outdoor pursuits, the books not unsurprisingly concerned horses and country sports. He had begun collecting as a schoolboy at Eton and his library started to take shape in the 1920s as he scoured bookshops and auction houses for rare editions. After his marriage Alice often accompanied him on the trawl and tried with limited success to protect him from being ripped off by overzealous booksellers.7

  In 1937 he paid top dollar at the New York sale of the Dixon collection, a highly sought after American sport and hunting library, but uppermost in his sights was the famous Schwerdt collection of sporting books. Later in the year he attempted to acquire the entire library but his offer was rejected. But little by little - as some of the more important works were put up for auction during the war years - he managed to buy around five hundred books which became the backbone of his own highly valuable library.

  Now discharged from the army, the newly-married Prince Henry was able to set up home in the country and begin a new life as a gentleman farmer. Alice, who as a child had spent many a happy summer in Boughton House in Northamptonshire and still retained many friends in the locality, had her eye on a nearby property - Barnwell, an Elizabethan manor house built in 1586 and later re-enlarged in the 19th century. The estate included farmland, a spacious garden and a ruined castle that had been a Buccleuch property from the 16th century until 1912 when it passed out of the family's possession. In 1938 the Gloucesters bought it back, paying £37,000 (£1.2m at today’s values) for the buildings and the four tenanted farms. The bulk of the money apparently came from Henry's £750,000 inheritance from George V.8