Politics: The Queen prepared to go public with the Royal accounts

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The Queen is prepared to make a significant break with the past, and give Parliament direct access to accounts of the Royal Household, `The Independent' can reveal. Kim Sengupta reports on a new effort at public accountability at the Palace.

The Queen has nothing to hide about her finances; indeed the way the Royal household carried out savings could be a lesson for many a public body, according to her senior advisers. And, to prove its point, the Palace has privately told the Government it would welcome direct scrutiny of its accounts by the Commons Public Accounts Committee.

The issue has long been a source of acrimony. In a recent report, the PAC claimed the Royal household was inefficient and secretive, and MPs blamed the Queen for being reluctant to offer access to the books - charges denied by the Palace.

Successive governments have resisted demands by MPs to have direct access to the accounts on the grounds that "it would be incompatible with the Royal household's unique constitutional position". However, MPs have become increasingly vociferous in their demand to see how pounds 20m of taxpayers' money is being spent.

David Davis, the new PAC chairman, says the auditor general should have immediate access to all Royal household accounts, including the Civil List and the transport accounts. The former Tory Foreign Office minister's initiative has come as a surprise to the Labour members of the committee, who have been campaigning unsuccessfully under previous chairmen for full access.

At present, the Queen submits information on the Royal finances to ministers whose departments would then decide what the auditors look at. There is also an annual report to MPs on the cost of official trips by the Royal Family.

Both Whitehall and Royal sources say it is the government departments who are uneasy about direct access rather than the Royal Family.

One Palace source said: "The Royal Family want to have transparency over their finances, and we think that is what the public want as well. The Queen would have no objection to direct scrutiny by the PAC or the Auditor General. The last thing we want is an impression that there is something to hide. We already have an independent external audit, and we are pleased with the savings we have carried out since we assumed the responsibility for the maintenance of the occupied Royal palaces in l991."

Along with offering greater openness, the Palace is also ready to be combative over what it perceives as unfair accusations. The critical PAC report is seen as negative and out of date. The Committee criticised low rents charged for Royal apartments. But Royal sources point out that since August l994, all staff and pensioners using the apartments have had a rent rise of 16.5 per cent.

The grant-in-aid expenditure by the Royal Household has fallen from pounds 20,541,000 to pounds 20,440,000 from l995 to 1996, and is intended to be reduced to pounds 15m in two years' time.

As part of a cost efficiency campaign, energy conservation measures have, says the Palace, resulted in savings of 9 per cent on electricity, 32 per cent on gas, and 61 per cent on water.

Much of this is said to be through the efforts of Michael Peat, formerly a partner in the accountancy firm KPMG, the Keeper of the Privy Purse, who has also brought in a performance related pay structure for some employees of the Royal Family.