First minister says Scotland ‘by hook or by crook’ will pay its full contribution to sovereign grant after further devolution

Nicola Sturgeon has denied that her government wants to cut Scotland’s financial contribution to the royal family, after a senior royal aide suggested it was reneging on a deal to pay its share.



The first minister said “there was no basis in fact” to claims from within the royal household that the Scottish parliament intends to withhold its share of the sovereign grant, which funds the monarchy.

On Tuesday the official in charge of the Queen’s accounts, Sir Alan Reid, expressed his worries about the implications for the royal household of a decision to allow Holyrood to control nearly all crown estate assets in Scotland.



On Wednesday Reid, the keeper of the privy purse, issued an unreserved apology, saying that a briefing on royal accounts that he hosted was “never intended to be a criticism of Scotland or of the first minister or to suggest that the first minister had cast doubt on the continued funding of the monarchy”.

He said: “As we made clear at the briefing, Scotland contributes in many ways to the Treasury’s consolidated fund – out of which the sovereign grant is paid.

“We said explicitly that to imply Scotland would not pay for the monarchy was simply wrong and we accept unreservedly the assurances of the Scottish government that the sovereign grant will not be cut as a result of devolution of the crown estate.”

Under a formula in the Sovereign Grant Act, passed in 2011 to replace the civil list system for funding the monarchy’s state duties, the Treasury puts the equivalent of 15% of the crown estate’s surpluses into the royal household’s annual funds – equating to £42m next year.



It was claimed that allowing the Scottish government to collect nearly all the crown estate’s Scottish revenues – one of the suite of new powers passing to Holyrood in the Scotland bill – could cut the Queen’s annual grant by £2.2m.

Reid said on Tuesday that the transfer of powers “does confuse the issue” of royal funding. An unnamed royal aide suggested Sturgeon was not honouring a pledge from her predecessor Alex Salmond to protect Scotland’s contribution.

“Originally, Alex Salmond did imply that might happen. But the new leadership said no,” the official said.

That brought a sharp rebuttal from Sturgeon, who tweeted the Channel 4 News journalist Cathy Newman: “There is absolutely, categorically, no intention by @scotgov to cut S’land’s contribution to Sovereign Grant & never has been.”

Nicola Sturgeon (@NicolaSturgeon) @cathynewman there is absolutely, categorically, no intention by @scotgov to cut S'land's contribution to Sovereign Grant & never has been

The first minister told BBC Scotland that the funding issue could be overcome by the Treasury, since crown estates income did not flow directly into the sovereign grant. Options could include supplementing cash lost from Scottish assets held by the crown estate from general taxation or amending the sovereign grant formula to reflect the indirect loss of that income.

“By hook or by crook, whatever way is actually agreed to do this, Scotland will pay its full contribution to the sovereign grant,” Sturgeon said. “There is no intention to cut the contribution, no desire to cut the contribution, and there has never been any discussion about cutting our contribution.”

The Treasury agreed, insisting there would be no impact on the royal household’s grant. “Scottish taxpayers will continue to fund a full and fair share of the sovereign grant, paid via the consolidated fund,” the Treasury said.

“The grant will not be adversely affected by devolution. Under the Sovereign Grant Act it cannot be reduced and the statutory review of the grant will ensure that it continues to provide the resources needed to support the Queen’s official duties.”

The recommendation to devolve crown estates control – a proposal backed in 2012 by the then Labour-dominated Scottish affairs select committee at Westminster – was accepted by the all-party Smith commission set up by the Tory-led government in London.