De Econometrist neemt een statistische kijk op de wereld.
The Dutch Royal Family is in the news every once in a while. Whether it is with their yearly press photo in Lech, or when princess Amalia was told she could still be queen if she marries a woman, or even when a private picture of Alexia was shared. We have had the monarchy for more than 200 years. In the year 1814, the first constitution of the monarchy was laid down, with king Willem I as its first king. However, lately, the support for the monarchy has been decreasing. So, should we even keep the monarchy? And do the benefits weigh up to the costs?
During the corona crisis, the trust in the Royal Family had fallen considerably. In April 2020 a good 76% of the Dutch people had (very) much confidence in the king. However, in December 2020 this percentage decreased to only 47%. This decrease was mainly due to their trip to Greece and the higher allowance that the king gets. This year, the confidence had been restored a bit. In April 2021, 57% of the Dutch had once again confidence in Willem-Alexander. Besides that, the trust in the king is also significantly lower than in the past years, as turned out during the yearly ‘Koningsdagenquête’ of Ipsos.
Moreover, this survey concluded that 72% of the people thought that princess Amalia’s allowance (1.6 million) will be too high once she reaches the age of 18. This amount of money is split into two parts, €300,000 will be income and €1,300,000 will be compensation for personnel and material expenses. However, in June 2021, princess Amalia wrote a letter to outgoing Prime Minister Rutte telling that she will not take the income part of the allowance until the end of her studies and she will refund the other part as long as she will not have high costs in her function as Princess ‘van Oranje’.
The ‘Koningsdagenquête 2021’ also showed us that the support of the monarchy has decreased significantly in respect to previous years. However, a majority (58%) of the Dutch people is in favour of keeping the monarchy. This is comparable to the support base in December 2020 (60%). In the years before 2020, the support base was approximately 70%.
The costs of the monarchy can be split up into two parts: the budgeted costs and the actual costs, calculated by a team of journalists led by René Zwaap, the chief editor of ‘De Republikein’.
The budgeted costs of the royal family are 48.2 million euros. These are split up into three categories. The first is functional expenses, which is budgeted to be 31.1 million euros. This includes the staff of the royal family, material expenses of the royal family and endowments destination reserves. The second is the allowances of the royal family, which includes the income and a part for personnel and material expenses. This is budgeted to be 10.5 million euros, distributed over King Willem-Alexander, Queen Máxima, Princess Amalia and Princess Beatrix. However, Princess Amalia will, as said earlier, refund this until the end of her studies. The third part consists of charged expenses, budgeted to be 6.5 million euros. Besides that, other expenses within the state budget are budgeted to be 18.1 million euros. This consists of housing, state visits and ‘De Groene Draeck’. Also, costs are budgeted for security. However, these are not revealed to the public. The whole budget can be found here.
In 2018 the ‘Republikeins Genootschap’ presented their research which showed that the costs of the royal family actually were 345.5 million euros. In the research of the ‘Genootschap’, which strives for the abolition of the monarchy, also the costs of security (40 million euros per year), the costs of state and working visits (almost 40 million euros) and the tax (192 million euros), which the royal family does not have to pay, were included. The last amount is based on an approximation of 12 billion euros private wealth, over which the royal family does not pay tax. However, according to the ‘Rijksvoorlichtingsdienst’ (RVD) these calculations are based on guesswork. The RVD does not want to spread knowledge about the private wealth of the royal family, as it is private. According to the RVD, the king also ‘just pays tax’, even though they admit some exceptions apply to the king. Moreover, they do not share the costs of security, in order to keep people from getting clues about the security of the royal family. You can find the whole research here.
On the other hand, the benefits of a monarchy are about 4 to 5 billion euros per year. These were the findings of H.P. van Dalen in 2007. A monarchy stimulates the economy yearly with 1%, according to Van Dalen. This comes down to 4 to 5 billion euros per year. A few explanations can be given for this. Trade missions along with visits from the royal family to foreign countries are valuable for business and for the ‘trust bonus’. This is the stability that a royal family shows to other countries. So, Prime Ministers come and go, but a monarchy stays and is important for the image of a country. However, van Dalen does not prove cause and effect anywhere. Is the Netherlands prosperous due to the monarchy, or is the Netherlands prosperous despite the monarchy?
So, should we keep or kick the king? For both sides, arguments can be given. However, based on research of the costs and the benefits a monarchy would be beneficial based on the monetary side alone. On the other hand, there are more ways to view this topic, which are not covered in this article.
This article was written by Deirdre Westenbrink