Press Release - Royal Travel by Air and Rail
22 June 2001
In the three years since the Royal Household took over
responsibility for managing its own air and rail travel, the cost
of such travel has reduced by two thirds. However, as a result of
the National Audit Office's enquiries, the basis of charging by the
Ministry of Defence for royal use of the RAF’s 32 (The Royal)
Squadron is to be changed.
According to today’s report to Parliament by head of the
National Audit Office Sir John Bourn, expenditure by the Household
since April 1997 on air and rail travel has totalled some £39
million, falling from £17.3 million in 1997-98 to an estimated £5.4
million in 2000-01 - a reduction of 69 per cent. Since 1997, the
Royal Household has administered a grant-in-aid1, until
recently from the Department of the Environment, Transport and the
Regions and now from the Department for Transport, Local Government
and the Regions, to cover the cost of royal travel by air and
rail.
Key findings of the NAO report are as follows.
- Ninety per cent of expenditure, and savings since 1997-98,
relate to expenditure on air travel, which was reduced from an
initial budget of £17.2 million in 1997-98 to £7.5 million in
1999-2000. Over the same period, the number of miles travelled by
air by members of the Royal Family fell by six per cent.
- The savings were achieved by replacing RAF helicopters by the
Household's own helicopter service; switching from the larger more
expensive BAe146 aircraft of 32 Squadron to the smaller BAe125
aircraft; and a reduction in the Ministry of Defence's charges for
the use of both aircraft types flowing from improvements in its
accounting systems and economies in the cost of operating the
Squadron.
- Since 1997-98 the Household has been charged the full costs of
using aircraft from 32 Squadron. In September 1999, the MOD
formally confirmed that the primary purpose of the Squadron was to
support military operations; and that any royal or other use of
spare capacity was secondary. Other non-military users of the
Squadron, such as government ministers and senior officials, are
already charged only variable costs. The MOD, the Department and
the Treasury agreed to change the basis of charging for royal use
of 32 Squadron aircraft, as a result of the National Audit Office's
enquiries. A change to variable cost charges (ie. excluding
overheads) will benefit the taxpayer, because it allows the
Household to use 32 Squadron when the variable cost of 32 Squadron
is lower than the costs of a charter.
- Expenditure on scheduled and chartered flights was broadly
constant, at £1.4 million a year, between 1997-98 and
1999-2000. The Household has established effective arrangements for
procuring chartered and scheduled flights, at prices which compare
favourably with industry norms.
- Expenditure on royal travel by train has fallen by nearly 60
per cent, from an original budget of £1.8 million in 1997-98 to
expenditure of £0.8 million in 1999-2000, and the cost per royal
mile travelled fell by 71 per cent. These savings result from a
reduction in the number of carriages maintained and operated, from
14 to nine, rationalisation of coach maintenance, and renegotiation
of planning and co-ordination charges. Sale of the surplus coaches
raised £235,000 for the Exchequer. The royal train was used on 60
occasions in these three years.
- The Household and the Department introduced systems to better
administer royal travel, including a system for taking cost into
account and comparing travel options for more expensive
journeys.
Sir John Bourn said today:
"The Royal Household has made very good progress in making
significant reductions in expenditure on royal travel whilst
maintaining flexibility and standards of provision. A change in the
basis of charging will bring further savings for the
taxpayer."
Notes for Editors
A grant in aid is a payment by a government department to
finance all or part of the costs of a body. Any grant not spent at
the end of the year reverts to the department and the
Exchequer.
Before April 1997, funding and responsibility rested with the
Ministry of Defence and the Foreign and Commonwealth Office for air
travel, and the then Department of Transport for rail travel. From
April 1997, the Household has had day to day responsibility for
managing royal travel arrangements; and the grant-in aid has been
administered by the Department of Transport and, from June 1997, by
the Department of the Environment, Transport and the Regions. From
June 2001 this has become the responsibility of the Department for
Transport, Local Government and the Regions.
Some travel is principally available for royal use, such as the
royal train and helicopter service; the Royal Family also uses
around 10 per cent of the flying time of the aircraft of the Royal
Air Force's 32 (The Royal) Squadron; whilst other travel is
undertaken using chartered or scheduled services. The grant-in-aid
does not cover royal travel by car, which is met from the Civil
List, Parliamentary Annuities or from the Royal family's own
funds.
Press notices and reports are available from the date of
publication on the NAO website at http://www.nao.org.uk/ Hard copies can
be obtained from The Stationery Office on 0845 702 3474.
The Comptroller and Auditor General, Sir John Bourn, is the head
of the National Audit Office employing some 750 staff. He and the
NAO are totally independent of Government. He certifies the
accounts of all Government departments and a wide range of other
public sector bodies; and he has statutory authority to report to
Parliament on the economy, efficiency and effectiveness with which
departments and other bodies have used their resources.
Press Notice 34/01
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