The Royal Family's core funding is set to increase to £100 million annually, nearly doubling within three years, according to a new agreement on the Sovereign Grant. The figure of £99.9 million for 2027-28 represents a £48.1 million jump from the £51.8 million core grant in 2024-25. This amount is expected to remain constant over the next five years, regardless of inflation spikes.
Decision by Royal Trustees
The new amount was decided by outgoing Prime Minister Sir Keir Starmer, Chancellor Rachel Reeves, and the King's Keeper of the Privy Purse and Treasurer James Chalmers, who serve as Royal Trustees. The significant boost from the Treasury will address a backlog of maintenance at occupied royal palaces, enhance cyber security at royal residences, and install energy-efficient heating systems, including £11 million set aside to replace boilers at Windsor Castle.
Value for Money Requirements
James Chalmers emphasized that the funding is "not a blank cheque" and is subject to strict value-for-money requirements. "Expenditure is governed by the same standards and disciplines as any publicly funded body, with strict value-for-money requirements, detailed planning, multi-year strategies, independent audit, and Treasury oversight," he said. The Sovereign Grant will be reduced after the completion of Buckingham Palace renovations, but the core grant is set to almost double.
New Formula for Sovereign Grant
From 2027-28, the Sovereign Grant will be calculated as 20.5% of Crown Estate net profits, up from the current 12%, for a period of five years. This change comes because Crown Estate profits, previously boosted by offshore wind option fees, are expected to be "significantly impacted" as those fees cease, according to the Royal Household's report on royal finances. Chalmers added: "It is important to emphasise that the Sovereign Grant does not provide personal income to members of the Royal Family. It funds the work of the institution – not private lives or private wealth."
Royal Engagements and Expenditure
The report also highlighted an increase of 104 public engagements to 708 undertaken by the King and Queen during 2025-26. Of these, 458 were conducted by King Charles, reflecting his positive health trajectory after his cancer treatment was reduced in December. Total expenditure for the year rose by £31.8 million, largely due to a reservicing programme that uncovered higher levels of asbestos than expected and increased property maintenance delayed during the COVID-19 pandemic.
Sustainability and Travel Costs
At least half of the royal vehicle fleet now runs on electric, hybrid, or biofuels, with new EV charging points installed across the estate, including at Buckingham Palace. Over £160,000 was spent on just four journeys on the royal train, which will be decommissioned in 2027 as part of a modernisation and cost-reduction effort. The most expensive royal trip of the year was the Prince of Wales's three-day official visit to Saudi Arabia in February, costing £130,000.
Duchy of Cornwall Initiatives
The separate Duchy of Cornwall report revealed that Prince William will no longer benefit from the controversial £1.5 million annual rent from the abandoned Dartmoor prison. Instead, the money will be reinvested in projects supporting Princetown and the wider Dartmoor community, particularly businesses that depended on the prison. The Ministry of Justice closed the prison in July 2024 due to unsafe levels of radon gas. The Duchy also unveiled a new impact-led strategy to unlock £500 million of investment over the next decade for housing, nature recovery, renewable energy, farming resilience, and community regeneration.
