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When Lord Hill of Oareford takes up his new role as Leader of the House of Lords, he will also take up the historic office of Chancellor of the Duchy of Lancaster. But what is the Duchy of Lancaster, and why is its chancellor a member of the Cabinet?
The Duchy of Lancaster is essentially a source of private income for the British monarch. Its origins date from the 14th century when King Edward III conferred the title ‘Duke of Lancaster’ on Henry of Grosmont as a reward for his service in the Hundred Years’ War. At the same time, Lancaster became a county palatine, which meant that its duke would enjoy considerable autonomy within the kingdom. When Henry died without a male heir, the title was conferred on his son-in-law, John of Gaunt, who happened to be the younger son of Edward III.
John’s son, Henry of Bolingbroke, inherited the title upon his father’s death. When he eventually took the throne of England, the Duchy of Lancaster merged with the Crown. The new king decreed that the duchy would always remain separate from the rest of the Crown’s holdings. In 1760, George III agreed to let Parliament have the revenues from Crown lands in exchange for a fixed payment called the Civil List. But the Duchy of Lancaster was not part of the deal, and it remained the monarch’s private property.
The chancellor is the duchy’s chief administrative officer, though much of the day-to-day business of running the duchy is delegated to the Duchy Council. The chancellor does, however, advise the Queen on a number of appointments within the duchy, including High Sheriffs and certain ecclesiastical positions. Although the Queen appoints the chancellor on the recommendation of the Prime Minister, the chancellor is accountable to her, and not Parliament, regarding the duchy’s affairs. The uniquely personal nature of the relationship is reflected in the fact that, unlike the rest of the Cabinet, the chancellor receives the seals of office during a private audience with the Sovereign.
Since the chancellorship itself has few duties, its occupant is free to act as a sort of Minister without Portfolio. The three most recent chancellors, however, have combined the job with the leadership of the House of Lords. Because the position of Leader of the House of Lords has no statutory basis, its occupant is not actually entitled to a salary. Therefore, in order to pay the leader, they must be given another office that actually draws a salary. Fortunately, the Ministerial and Other Salaries Act 1975 provides salaries for a number of sinecure offices (including that of Chancellor of the Duchy of Lancaster) for that very purpose.
Of course the Leader of the House of Lords is not the only one in this predicament. The Government Chief Whip in the Lords also holds the office of ‘Captain of the Honourable Corps of Gentlemen-at-Arms,’ while junior Government Whips in the Commons are appointed to an assortment of positions in the Royal Household. Even the Prime Minister ultimately derives his authority (and his salary!) from the sinecure office of ‘First Lord of the Treasury!’