Taxpayers make pounds 94m from royal property
Crown Estate profits: Record results for the owner of Pall Mall and a large chunk of Regent Street
And for once, the biggest winners will be not be shareholders, but taxpayers.
Under the terms of a deal struck with a cash-strapped King George III in 1760, the monarch agreed to hand over the entire revenue surplus of the Crown Estate in return for the Civil List.
It is a constitutional settlement the monarchy has lived to regret. Payments under the Civil List currently cost the nation pounds 7.9m a year, whereas the Crown Estate will hand over a cheque to the Chancellor, Kenneth Clarke, for pounds 94.6m, 11.5 per cent more than a year ago.
According to Christopher Howes, the Crown Estate's chief executive, the upkeep of the Royal Family, including head of state expenses, costs about pounds 50m a year, "substantially less than our surplus".
The value of the Crown Estate's core property holdings, which also include almost 210,000 acres of agricultural land, Scottish fish farms and a retail park at Altrincham in Cheshire, rose a tenth to pounds 2.2bn. "These excellent results undoubtedly position the Crown Estate right at the forefront of the UK's leading property investment companies," said Sir Denys Henderson, the former boss of ICI and Zeneca, who took over as chairman in August.
The Crown Estate has increased its revenue surplus every year for the past decade, showing strong growth right through the recession when many property companies plunged into loss. Mr Howes forecasts that the revenue surplus will break through the pounds 100m barrier in the year to March 1997.
Mr Howes attributed its success to the discipline of having no borrowing powers. Unlike the Church Commissioners, which lost hundreds of millions financing development with debt, the Crown Estate can only invest with cash raised from asset sales.
The Crown Estate courted controversy last year when it became embroiled in a row over the felling of ancient oak and lime trees in Windsor Great Park.
The felling of oaks in Queen Anne's Ride was halted after representations to Buckingham Palace from conservationists and protests from local councils, residents and activists who camped in tree-houses.
Prince Philip later approved plans for restoring the park avenue, preserving 20 trees he had originally intended to cut down.
After conducting a review of plans for restoring the three-mile-long avenue, first planted in the 1720s, the Crown Estate decided that the oldest oaks which survived the chainsaws would be preserved.
The Crown Estate also owns over half the UK's foreshore and almost all of the seabed out to the 12-mile territorial limit. Mr Howes admitted that dealing with the recently privatised water companies and port authorities had forced the Crown Estate to adopt a more commercial approach, but he dismissed suggestions that the Crown Estate itself might one day be privatised.
The annual report, also published yesterday, revealed that Mr Howes' pay, including performance-related bonuses, rose to pounds 135,237 from pounds 103,982. He also received a pounds 13,297 terminal bonus on the expiry of his contract. A new, two-year contract was subsequently signed.
Mr Howes defended his salary package. "I'm not a fat cat," he said. "In fact I'm rather a thin one."
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