After weeks of feeling bemused and then annoyed by the endless media coverage here in the UK of Harry and Meghan’s ‘abdication’ from royal duties, I’ve decided to join in. Aside from being a welcome distraction from Brexit, it occurred to me that there are several implications for procurement theory and practice. I examine these below – but first let me offload my ideological prejudices. I believe in individual liberty, and think that Harry and Meghan (like everyone else) should be able to do whatever they wish, within the bounds of the law. I don’t think that being born into a particular family, or even marrying into a particular family, means that you can be compelled to work for it – and this is just as true for immensely privileged families as it is for poor or average ones. I wish the couple well with whatever activities they pursue in Canada, and hope they won’t be reduced to doing maple syrup adverts or opening lumberjack lacrosse competitions, unless that’s what they want.
Are the services provided by the Royal Family subject to procurement law?
Whenever the debate about the merits of the monarchy is aired in the UK, complaints about the cost of maintaining the Windsors are countered by assertions of their contribution to the public purse. This takes various forms: tourist revenue, trade, and the numerous services rendered by the Queen as head of state. Forbes reported that the royals contributed nearly £1.8 billion to the British economy in 2017, including £550 million in tourism and £150 million in trade linked to official visits and diplomatic missions abroad. The Sovereign Grant, which meets the cost of the Queen’s official duties and maintaining palaces, is calculated as a percentage of the revenue from the Crown Estate and amounted to £82.2 million in 2018-19.[1] A significant portion of this was spent on renovating Buckingham Palace – which raises its own procurement questions. Although the royal household is not subject to the EU Procurement Directives, under the terms of the Sovereign Grant “Contracts should always be placed on a competitive basis, unless there are convincing reasons to the contrary.”[2]
But the question here is whether the Sovereign Grant is really a grant and thus outside the procurement rules – or whether the services provided by the Royal Family should be awarded on a competitive basis. Although this has never been a bright line in EU procurement law, Recital 4 of the Public Sector Directive suggests that grants are ‘linked to the obligation to reimburse the amounts received where they are not used for the purposes intended.’ While it seems a rough form of accounting is applied to the Sovereign Grant, amounts not spent are assigned to the Sovereign Reserve, rather than being returned to government. Uncharitable types have called for the cost of Harry and Meghan’s wedding to be repaid, but the bulk of this was met out of the royals’ own resources, rather than by the taxpayer. The exception is security costs – it would be hard to argue this wasn’t spent for the purpose intended, despite the odd officer who may have spent time taking selfies instead of guarding a perimeter fence. While the Sovereign Grant’s exemption from the procurement rules may be in doubt, an argument could be made that only one operator is in a position to deliver the services required. This depends in part on the geographic scope of the market, to which I turn next.
Are Royal services of certain cross-border interest?
For centuries, a single European market existed for royals. Monarchs and their spouses were just as likely to be made in Germany, France or Spain as Britain. It was quite a competitive market, with the fortunes of thousands of aristocratic families across the continent depending on (marriage) contracts being awarded. With the withering of European monarchies over the past century, an argument might be made that contracts for royal services are no longer of cross-border interest. However as can be seen from Harry’s marriage to Meghan, an American, interest from new market entrants cannot be excluded. In the absence of either an EU or UK comprehensive trade deal with the United States, market access for public contracts is regulated by the WTO Government Procurement Agreement. This requires open advertisement, non-discrimination and transparency in the selection of contractors. I will leave it to avid tabloid readers to decide whether Harry applied these rules in his search for a spouse. Following Brexit, the UK will need carefully balance its access to the European and US markets, so matching a royal to a Dutch or Belgian spouse might be in order.
Is being a member of the Royal Family a form of Modern Slavery?
Under the Modern Slavery Act, public authorities are required to exclude suppliers or service providers who have committed offences linked to forced labour and people trafficking.[3] An offence is committed, inter alia, if “[a] person requires another person to perform forced or compulsory labour and the circumstances are such that the person knows or ought to know that the other person is being required to perform forced or compulsory labour.”[4] While the Queen has now agreed to release Harry and Meghan from their royal duties, it does seem that an element of compulsion has been used in the past. This compulsion may be partially internalised; anyone who has watched the third series of The Crown will realise how miserable royal duties can make the Queen herself (qua Olivia Colman). Without detracting from the seriousness of such offences, it might be wise for any contract for royal services to specify that all individuals involved in providing such services are free to resign at any time, without sacrificing their passports. For good measure, the protections for basic labour rights set out in Article 18(2) of Directive 2014/24/EU should be explicitly included in all contracts. Particular enforcement of the prohibition on child labour under ILO Conventions 138 and 182 may be necessary.
Using the Innovation Partnership to procure Royal services
Critics of the monarchy, and even some of its fans, say that it struggles to maintain relevance in the modern world. Like any family business, some members are better suited to it than others, and it is unfortunate when the least apt members are placed in a position of responsibility. If procurement achieves anything, it identifies those who are best suited to carrying out a task, or at least those who have the stamina to withstand lengthy and complicated award procedures. Royal services are undoubtedly complex and cannot be purchased off the shelf – which under the procurement rules means use of special procedures can be justified. To truly get best value from the Royal Family, why not select members for specific duties using the Innovation Partnership? This would allow multiple members to be engaged at an early stage (say: birth) to develop solutions to the UK’s various constitutional, foreign and domestic policy problems, with the best solutions being selected after prototyping and testing. Some solutions would be discarded: for example, Prince Charles’ idea to introduce homeopathy on the NHS. Big Ben may not chime on Brexit day, but there’s no reason why Britain’s royals can’t strike a note of optimism, industry and buccaneering capitalism by competing amongst themselves.
[1] https://www.royal.uk/sites/default/files/media/final_sovereign_grant_for_website.pdf
[2] https://www.royal.uk/sites/default/files/media-packs/sovereign_grant_framework_agreement_-_2018_final.pdf
[3] Reg. 57(1) (ma), Public Contracts Regulations 2015
[4] Reg. 1(1)(b), Modern Slavery Act 2015
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