“The Firm”, as the Royal House is known, is very profitable for its subjects. It is an important source of income for the economy, thanks to its impact on tourism, companies and even audiovisual production
Elizabeth II generates income for her country even after her death . The queen’s state funeral, which takes place tomorrow at London’s Westminster Abbey, the same place where she was crowned 70 years ago, has continued to attract Britons who have traveled from all over the United Kingdom. , but also to tourists and the curious. They are joined by the fifty heads of state and international leaders, with their corresponding delegations, who have traveled to the British capital, in the largest concentration of world leaders of the century. A historic event that no one wanted to miss and that, surely, will leave important benefits in the city of the Thames.At street level, florists are selling more flowers than ever, and newsagents have come to have to limit the sale of newspapers to one per person. Not to mention the hotels, which have quadrupled the rate of their stays, as well as the souvenir shops, which have also shot up the price of their items.
It is estimated that the cost of the Queen’s funeral will amount to 5.4 million pounds (6.2 million euros). Nothing compared to the up to 500 million euros (430 million pounds) that can be moved in the British economy in these days of homage to the sovereign, according to the experts consulted. And it is that “The Firm” (the company), the term with which the British media refer to the Crown, is a very powerful brand, which generates a huge amount of income for its country. In 2017 alone, when the 70th anniversary of the marriage of Elizabeth II and Philip of Edinburgh was celebrated, the Monarchy’s contribution to the UK economy amounted to almost 1,800 million pounds (2,034 million euros), according to the firm Brand Finance . An amount that today, taking into account the CPI adjustments, would be close to 2,500 million euros. A not insignificant figure if one takes into account that the Monarchy cost the public coffers 292 million pounds (337 million euros), which translates into 4.5 pounds per British citizen, just one penny a day.
The contribution includes the surplus of the patrimony of the Crown, as well as the indirect effect that the Monarchy exerts on various industries, such as tourism, commerce, the arts or the media.
The royal palaces, such as Buckingham, Windsor Castle or the Palace of Holyrood, attract millions of visitors every year, with their consequent contribution to the country’s tourism industry.
British companies also benefit , both in terms of price and sales volume, from “Royal Warrants” or coats of arms, which are powerful marketing tools. In the United Kingdom, more than 800 brands are holders of a «Royal Warrant» , a royal seal that is a guarantee of success, although obtaining one of these royal warrants is not an easy task either, since they must go through a meticulous scrutiny and take care of the product reputation. Hunter, Martini, Barbour, Burberry or Bendicks cookies are some of the firms that bear the shields of suppliers of the Royal House, a distinction that companies also favor when exporting abroad, especially to China, the Middle East and the United States. In fact, a study by the University of Warwick revealed that 70% of Chinese buyers preferred to buy products with a “Royal Warrant” than those that did not.
Ambassadors and series
There are also significant benefits to charities and institutions under royal patronage, not to mention the boost for British brands informally supported by family members . Just the fact that some of them, especially the most popular ones like the new Princess of Wales or her children, wear a certain item of clothing at public events is synonymous with out of stock. An example of this is Diana’s famous pose, with Hunter,and Charles of England in Scotland in 1981. From that moment on, these wellies went from being simple shoes for walking through mud to becoming an icon of sophistication. Thousands of British women took to the streets to buy a pair of boots, their sales skyrocketing, something that was used by the firm to internationalize its brand.
The royal family also promotes trade by acting its members as ambassadors of their country during their international visits. And it is that royal trips are not only intended to strengthen diplomatic relations, but also to establish and strengthen commercial ties.
Nor should we forget the contribution of the Monarchy to the media and arts industry. The success of series like “The Crown” is proof of this. Its first season cost around 100 million pounds, making it the most expensive British production in history. However, “The Crown” also meant the creation of a large number of jobs, especially specialized. Not to mention the media interest generated by the royal family itself, something that is also reflected in the sale of newspapers or documentaries.
How are they financed?
Based on these data, it is therefore clear that the Monarchy is very profitable for the British, but how do they finance it? The main source of funding for the Crown is the ‘Sovereing Grant’ . Contrary to other European monarchies, which obtain their income through the budgets of their respective states, the sovereign receives 15% (in 2017, it was raised to 25% until 2028 to support the remodeling of Buckingham Palace), of the income generated by the “Crown Estate” (“Crown Land”), amounting to almost 100 million poundsannual. It is the public patrimony of the monarch, a large portfolio of properties, both rural and urban, which brings together a set of lands originally owned by royal property, but which are exploited by the British Treasury by virtue of an agreement reached in 1760. In the last decade, “Crown Estate” has contributed more than 2,800 million pounds (3,234 million euros) to the public coffers . The income that the Crown obtains in this way is mainly used to pay personnel expenses, maintenance of palaces, security, travel or per diems.
Another source of financing is the ” Privy Purse”, a private income of the sovereign, which comes mainly from the income generated by the Duchies of Lancaster and Cornwall, and which in the last fiscal year recorded a net profit of almost 30 million euros.
It so happens that, after the death of Elizabeth II and accession to the Throne of Charles III, William of England, the new Prince of Wales, has also become Duke of Cornwall (a title held by his father until now), and that It is perhaps the most economically important.
After the death of his grandmother, the new heir to the Crown receives from his father an empire of rural and urban land, as well as homes and businesses, whose value exceeds 1,000 million pounds (1,150 million euros).
The Duchy of Cornwall makes William of England financially independent , since he will not have to depend on the allowance that he and his brother Henry received until now from their father.
But the Crown has a third source of income. These are the personal investments of the Queen, among which are palaces, art collections and also shares in companies.
Until the Queen’s death, this private income was distributed among members of her family, including those without a public allowance, and was also used to defray the expenses of the residences she owned.
Elizabeth II’s fortune, which will now pass to her heirs, is immense. According to “Sunday Times”, the monarch hoarded between 500 and 600 million euros, raising the total assets of the British Royal Crown to 82,300 million euros , of which half, about 40,600, were amassed by Elizabeth II in her 70 years of reign
The new king will be the biggest beneficiary of his mother’s inheritance, receiving, in addition, the management of the Duchy of Lancaster and also the income from the sovereign grant. A transmission that, in addition, is free of paying taxes.
The direct possessions of the Queen, such as Balmoral Castle, Sandringham House and Kensington Palace, as well as her jewels, works of art, cars, horses, swans (every duck in the country has been royal property since the 12th century) and her extremely valuable collection of stamps, which he inherited from his father, George VI, will be divided among his children and grandchildren.
The richest monarchies
In this way, the British Monarchy is among the richest in the world, a ranking headed by the Royal Family of Thailand, which has an estimated fortune of 30,000 million euros, according to Forbes.
In Europe, the Prince of Liechenstein, John Adam II, is the richest sovereign in the Old Continent , with a fortune amounting to 7,000 million. He does not have any public allocation, nor does he need it, since, among his many properties, he even has a bank.
In what does lead the ranking, the British monarchy is the one that receives the most money from the public treasury . Through the Sovereign Grant, it pockets more than 100 million euros annually. The second European monarchy with the most allocation is that of Monaco, with 48 million. Third place goes to the Royal House of the Netherlands, with 44.4 million; followed by Norway, with 43 million; Luxembourg, with 17.5 million (although King Henry’s assets exceed 4,000 million); Denmark, with 12 million, and Belgium, with 11 million. Spain and Sweden are among the most austere in the Old Continent, with a public contribution of 8.4 and 6.7 million, respectively.Specifically, King Felipe VI has a salary of 258,927 euros per year and his assets amount to 2.5 million between bank accounts, works of art and jewelry.