A King’s Ransom: Breaking Down the Incalculable Wealth of Charles III

To celebrate the first anniversary of the coronation of King Charles III we breakdown the monarch’s fortune and its various sources – the public, the private and the uncertain – in this story from Zoomer‘s April/May 2024 issue.

 

The Royal Family is a brand, a corporation and a tourist attraction, dressed up in diamonds and ermine for state occasions, ferried about in gold carriages on coronation day and ensconced in palaces decorated with priceless art. We know King Charles III –  the sovereign and head of state of the United Kingdom, Canada and 13 other Commonwealth realms – is wealthy, but exactly how rich is rich? 

In 2023, an investigation by the Guardian newspaper said the King’s net worth was the equivalent of C$3.1 billion, an estimate the palace called “a highly creative mix of speculation, assumption and inaccuracy.” The notorious secrecy of “the Firm” (a sobriquet coined by King George VI) as well as byzantine laws and backroom deals continue to provoke U.K. taxpayers, who fund the monarch’s day-to-day costs, from travel to the valets who dress him. That money from the public purse, called the sovereign grant, netted Charles a tidy $145 million in 2022-2023 – or  $2.22 for every U.K. taxpayer.

When Queen Elizabeth II died in 2022, King Charles also inherited her personal fortune, estimated to be worth $860 million. And no one really knows how much the late monarch and her heir earned from two substantial landholdings because it is considered private income: the Duchy of Lancaster, which passed to Charles when the Queen died, and the Duchy of Cornwall, which Prince William inherited when Charles became King. The Guardian investigation, called “The Cost of the Crown,” estimated Queen Elizabeth and Prince Charles made more than $2 billion from the duchies’ property holdings and subsequent investments.

 

Monarchs have long been sensitive to criticism of their vast wealth and spending, so, when a massive 1992 fire at Windsor Castle provoked public outcry, after the government said it would foot the bill, the Queen chipped in $3.4 million. The rest of the $62-million cost was raised through Buckingham Palace entry fees when the Queen agreed to open the State Rooms to the public for the first time. The fire, meanwhile, reignited debate over the Queen’s legal exemption from inheritance, income and capital gains taxes; after a year of negotiations, she made a deal in 1993 with then-Prime Minister John Major. Any assets passed down from sovereign to successor would be exempt from inheritance tax, and she would voluntarily pay income tax and capital gains tax on some private income, an agreement Charles abides by today.   

Here’s a breakdown of the sources of King Charles III’s fortune – the public, the private and the uncertain. 

 

Public Money: The Sovereign Grant

 

In 1760, King George III transferred all his land and property (except for the two Duchies) to the British Parliament in exchange for a fixed payment from the government to cover his operating expenses. These royal assets, now called the Crown Estate, are managed as an independent business “acting in the national interest.” Although they pass down from one sovereign to the next, they are held “in right of the Crown” and the King can’t sell them. In 2022, the vast $27-billion portfolio – which includes rural land, the Windsor estate, London real estate and even the seabed around England, Wales and Northern Ireland – generated $761.5 million in net profits for the U.K. Treasury, which funds public services like health care and education.

In the biggest restructuring of royal finances in 250 years, the British Parliament approved the Sovereign Grant Act in 2011, which consolidated four different grants covering royal expenses, and directly linked the monarch’s annual payment to income from the Crown Estate. The sovereign grant (covers expenses for maintaining royal residences, travel costs for working royals and staff payroll) is now calculated as a percentage of the profits earned by the Crown Estate. 

That percentage now stands at 15 per cent, after being temporarily increased to 25 per cent in 2017 to cover the $620-million refurbishment of Buckingham Palace. When the Crown Estate inked a $1.7-billion-a-year offshore wind farm deal in 2023, the government decided to cut the sovereign grant to 12 per cent in response. Even so, the annual payment to Charles is still expected to rise to $216 million in 2026 as the estate’s profits balloon from the wind-farm windfall.

The King doles out some of that money to the 11 working members of the Royal Family to cover expenses related to their public duties – mainly Prince William and Catherine (the Prince and Princess of Wales), Princess Anne (the Princess Royal) and Prince Edward and Sophie (the Duke and Duchess of Edinburgh). 

 

The Royal Collection & Palaces

 

The Royal Family have accumulated a collection of more than a million objects over the past 500 years, but it’s considered the U.K.’s cultural inheritance and cannot be sold by members of the Royal Family. Charles III is descended from generations of art patrons, including King Charles I (a serious collector of masterpieces by artists such as Anthony Van Dyck and Peter Paul Rubens) and King George IV (a collector of Dutch, Flemish and French art). Today, the market value of the Royal Collection is estimated to be worth more than $17 billion, but the historical significance and association with the Royal Family only increases its worth. Masterpieces from the Royal Collection are on public display in 15 royal residences and former homes, like Buckingham Palace (the King’s Gallery), the Tower of London (Crown Jewels) and Hampton Court Palace (the Great Hall tapestries).

As King, Charles III can use more than a dozen palaces and residences that belong to the nation, such as Buckingham Palace, Clarence House, St James’s

 

Palace, Windsor Castle and the Palace of Holyroodhouse. The combined value of these properties has been estimated to be worth between $6.9 billion and $17 billion.

 

Private Money : The Duchies of Lancaster and Cornwall

 

Since the 14th century, when King Edward III’s fourth son, John of Gaunt, married Blanche of Lancaster (heiress to the Duchy of Lancaster and a muse of Geoffrey Chaucer), the monarch has annually reaped an estimated $33.6 million in revenue from the Duchy of Lancaster – 18,000 hectares (44,748 acres) of rural land spread across England and Wales – according to Robert Hardman’s 2024 biography, Charles III (see excerpt on p. 50). The income, called the Privy Purse, flows in from a portfolio of prime London real estate and rural properties, as well as financial investments. In its latest annual report for the year ending March 31, 2023, the Duchy’s reported net assets were worth about $1.1 billion and the monarch got a $45 million payment. 

For 70 years, as heir to the throne, Charles also earned money from the Duchy of Cornwall, where he famously raised oysters, invested in organic farming and developed the Duchy Originals grocery line to fund his charities. Some of that income supported his sons, Prince William and Prince Harry, and now the Duchy of Cornwall has been inherited by Prince William, the new Duke of Cornwall and Prince of Wales. William is now his father’s landlord, as the King is reportedly paying his son $1.2 million a year to lease Highgrove House, the 18th-century country home he bought in 1980.

 The Guardian, which noted Elizabeth II and Charles earned a whopping $2 billion from the “medieval fiefdoms,” recently uncovered a feudal rule called bona vacantia that allows the Duchy of Lancaster to profit from people who die without a will or heirs. It reported the duchy collected $103 million in assets over the past 10 years, only some of which went to charity, as intended.  

 

Personal Properties

 

The Industrial Revolution made the Duchy of Lancaster a more valuable property for Queen Victoria (1837-1901), as rents from rural tenants were supplemented with revenue from industrial development. Victoria and her husband Prince Albert spent some of this bonanza on palaces, purchasing Balmoral Castle and Birkhall in Scotland and Osborne House on the Isle of Wight. Their son, King Edward VII, donated Osborne House to the Royal Navy, but purchased his own private estate at Sandringham in Norfolk. Balmoral, Birkhall and Sandringham are now King Charles III’s personal properties, which he may sell or repurpose at any time. The Balmoral estate (including Birkhall) is estimated to be worth $190 million while Sandringham is estimated to be worth $98 million.

 

Mystery Money

 

Since 1910, when Queen Mary’s brother Francis of Teck left heirloom family jewels to his mistress, royal wills have been sealed to the public for 90 years, and that includes more than 30 wills over the past century. That means the precise amounts left to descendants of Princess Margaret, Queen Elizabeth the Queen Mother, Queen Elizabeth II and Prince Philip are difficult to quantify.

Some details of royal wills, however, have been reported in the press. Queen Victoria is reputed to have left personal bequests to her younger children, who did not have the same financial resources as her heir, King Edward VII. Queen Mary, the widow of King George V, left her personal wealth and jewels to her granddaughter, Queen Elizabeth II. Queen Elizabeth the Queen Mother left all of her estate to Queen Elziabeth II, but reportedly set up a trust fund for her great-grandchildren eight years before she died in 2002. It allegedly gave more to Prince Harry than Prince William, to compensate for being the spare not the heir, while the princes’ personal wealth was also enriched by the inheritance from their mother, Diana, Princess of Wales. Charles inherited Queen Elizabeth II’s estate, including dozens of award-winning horses – estimated to be worth $46 million – which he has started to sell off. 

 

The Value Proposition 

 

In the 21st century, the press and the public are still debating whether the monarchy provides good value for money. Organizations in favour of abolishing the monarchy argue the sovereign grant should be replaced by a fixed salary not tied to the surplus revenue from the Crown Estate, and the current sovereign grant should be spent on services benefitting the public. 

Defenders of the monarchy list the ways the Royal Family provide value, including the political stability provided by the constitutional monarchy, the diplomatic value of royal tours and the role of the Royal Family in charitable patronage and fundraising. Perhaps the most frequent argument in favour of the monarchy is the tourism revenue generated by the Royal Collection and the Crown Estate. Every year, millions visit royal palaces and art exhibitions, which brought in nearly $86 million in admission income in 2019-2020, just before the COVID-19 pandemic shut down international travel.

There’s nothing like the pomp and circumstance of a big royal event such as a coronation, anniversary or wedding to bring tourists to the United Kingdom, with the national tourism agency VisitBritain estimating Queen Elizabeth II’s 2022 Platinum Jubilee celebration (marking 70 years on the throne) attracted an extra 2.6 million visitors and pumped more than $2 billion into the economy. Royal fans will have to wait a long time for more fairytale nuptials since Prince George, the second-in-line to the throne, is only 11 years old, but the June 15 Trooping the Colour parade in London – a 260-year-old tradition honouring the monarch’s official birthday – is just six weeks away. 

A version of this article appeared in the April/May 2024 issue with the headline A King’s Ransom, p. 52.

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