King Charles III in Camberley, England.
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LONDON – British government funding to the British royal family is expected to “increase significantly” in the coming years, according to a new report review Annual Sovereign Grant.
Treasury officials said on Thursday, crown estateFrom next year, the profit paid to royals will drop to 12% from the current 25%.
Despite the percentage drop, the unexpected surge in profits means the royal family is on track to receive more money than in previous years.
The amount of the Sovereign Grant is linked to the profits generated by the Crown Estate, which covers all hereditary assets belonging to the Sovereign, including large tracts of land as well as large swaths of the UK coastline and seabed.
According to the HM Estate, the portfolio has a total value of £16 billion ($20.5 billion) and generated “a lot of extra income“From offshore wind facilities owned by the Crown.
Sovereign grants are based on profits generated in the first two years of the financial year and are worth £86.3m this year, unchanged from the previous year.
According to the latest report of the Crown Trustees on Sovereign Appropriations, the Crown is expected to receive around £1.04 billion in profits from Crown estates in 2023-2024 and £1.05 billion in profits from 2024-2025.
Under the new 12% formula, this means the monarchy could receive £124.8m in 2025-26 and £126m the following year.
government seal of approval
The “royal trustees” who work out how much money the royal family should receive include Prime Minister Rishi Sunak and Finance Minister Jeremy Hunt.
The review said the trustees were “satisfied that the anticipated increase in grant levels was appropriate” after funding remained at a steady level in previous years.
The review said maintaining funding at previous levels had “limited” the maintenance work required on Crown properties.
The trustees added that the previous figure of 25% was “no longer appropriate” given the royal family’s net profit could exceed £1bn, meaning a 25% cut would “significantly exceed the royal family’s needs”.
The grants review also outlines that sovereign grants and how they will be calculated will be assessed before the 2027/28 financial year, but due to the so-called “Golden Ratchet” Clause Introduced in 2011, funding to the royal family can increase with profits, but not less than the previous year.
Objections against the monarchy
The appropriations review also outlines the use of the money, including the maintenance of royal residences, the employment of household staff and travel by the royal family for official events in the UK and overseas.
The Crown has been officially funded by the British Government since 1760 and was incorporated into the Sovereign Appropriation in 2012.
Organizations critical of the royal family have spoken out against the increased funding and the way the HM Treasury has provided information.
“The claim that sovereign funding will be cut by £24m is grossly misleading,” Graham Smith, chief executive of anti-monarchist campaign group Republic, said in a release.
The group added: “The appropriation will remain the same and royal spending will increase like most years…the government and the royal family are misleading the public.”
Neither Buckingham Palace nor the Treasury immediately responded to CNBC’s request for comment.
— CNBC’s Sam Meredith and Ruxandra Iordache contributed to this report.