Royal finances face a cut. But will much really change?

ShareSaveAdd as preferred on GoogleSean CoughlanRoyal correspondentBBCRoyal finances can feel mysterious, like trying to see what's in a crowded room with very little light. The funding mechanisms are complicated, the language antiquated and much about the income remains under a padlock of privacy. But there are challenging months ahead. A funding cut is on the way, the first for many years. And in the wake of the scandal surrounding Andrew Mountbatten-Windsor, there will be more scrutiny and demands for greater transparency. If Elizabeth II had in 1992 what she described as her "annus horribilis", the reign of King Charles has had its Andrew horribilis. Now, for the first time since the Sovereign Grant was introduced in 2012, public funding for the running costs of the monarchy will almost certainly be reduced. Its current record level was a temporary boost to pay for Buckingham Palace repairs. There are meetings taking place, headed by the Treasury, to see how much it should be lowered. That review takes place every five years, and Treasury ministers have already signalled that the grant is expected to be at a lower level. That seems to have been confirmed with the announcement of the Sovereign Grant Bill in this week's King's Speech. Meanwhile, later this summer, MPs on the Public Accounts Committee (PAC) will hold an inquiry into the Crown Estate - an independent property company with a requirement to provide good value to the public - and examine the leasing arrangements for properties occupied by members of the Royal Family. This was announced after public outrage and questions about value for money raised by Mountbatten-Windsor's previous residency at Royal Lodge in Windsor. As a wealthy institution in receipt of public funding, money has always felt like an Achilles heel for the royals - and deeper scrutiny of their finances will be uncomfortable for them. Andrew Lownie, author of a coruscating biography of Mountbatten-Windsor, says Andrew's downfall has raised wider questions for the public about the royals and money. "It's opened a can of worms for the rest of the Royal Family about their own finances and… I hope there's more scrutiny, as they need to be more open," says Lownie. That seems to be reflected in the public mood. A YouGov opinion poll last month found 64% supported the monarchy, but only 53% thought the Royal Family represented good value for money. Mountbatten-Windsor has been toxic for the reputation of royals and their finances. Stories have emerged in which he seemed entitled and demanding, including when he was a trade envoy, with former civil servants stepping forward to say the former Prince Andrew had charged taxpayers for excessive travel costs. "I couldn't believe it… it was like it wasn't real money, they weren't spending any of their own money," a former senior civil servant told the BBC. The Epstein Files have raised further questions about his financial dealings with the sex offender, Jeffrey Epstein. Mountbatten-Windsor has always rejected any wrongdoing in his associations with Epstein and denied any personal gain from his role as trade envoy. The committee of MPs will try to untangle more about his dealings with the Crown Estate, and find out about other royals who are living in their properties, which are meant to deliver public value for money. The PAC will be asking some awkward questions as it digs around royal leases and finds out what is being paid. It can sometimes feel as though we're only seeing part of the picture. Even after Mountbatten-Windsor was so publicly removed from Royal Lodge, the BBC later found he was handing back another Crown Estate property nearby, East Lodge, on which he had a lease. Buckingham Palace is already braced for the reduction of the Sovereign Grant. At present, for 2026-27, the Sovereign Grant currently stands at a record £137.9m, in the second of a two-year hike to pay for building work at Buckingham Palace. Plans for a reduction were indicated by Financial Secretary to the Treasury Lord Livermore. "The government is committed to bringing forward legislation to reset the grant to a lower level from 2027-28 once Buckingham Palace reservicing works are completed," he told the House of Lords in March. There are now plans for that legislation to carry this out. Cutting funding will see the end of a long upward trend, with the Sovereign Grant having almost trebled in real terms, taking into account inflation, in the 14 years since the grant was introduced. The Sovereign Grant was £31m when it was launched in 2012 as a more efficient way of covering royal costs, such as staff, buildings and official travel. It brought together public funding for the royals into a single payment, replacing a mix of grants from a range of government departments. It's not known yet how much the reduction might be, or when it will be announced, but the approaching funding cut won't be a surprise to the Royal Household, as it knew t

Royal finances face a cut. But will much really change?

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