The 2026 review recommends raising the formula percentage from 12 to 20.5 percent, holding the Grant flat for four more years and legislating for a cut the current Act forbids
The monarchy’s public funding is about to fall, and it is falling by law. The Report of the Royal Trustees on the Sovereign Grant Review 2026 recommends changing the reference percentage used in the Grant formula from 12 percent to 20.5 percent. On the figures in the report, the Grant would fall to 99.9 million pounds from 2027-28, down from 137.9 million pounds in 2026-27. It is then expected to stay flat at that level through 2031-32, which the Trustees say means a further real-terms reduction in the Grant amount each year. The Royal Trustees are the Prime Minister, the Chancellor of the Exchequer and the Keeper of the Privy Purse.
Why a Cut Needs a Bill
The mechanics are the interesting part. The Sovereign Grant Act currently prevents the Grant from being set below the previous year’s amount, so the Government plans legislation to allow the lower 2027-28 figure. That is a rare thing: a statute that has to be amended in order to make the monarchy cheaper. The next review is planned for 2031. For a document of this kind the language is plain, and the underlying message is that the extraordinary years of high funding are ending.
It helps to put the recent history in order. In 2016 the Grant was temporarily increased to pay for the reservicing of Buckingham Palace, which the report describes as addressing plumbing, electrical and heating systems largely unchanged since shortly after the Second World War. That programme is nearing completion, and the Grant is reverting towards a level closer to normal, though still well above the pre-2016 figures. A report republished by The Star from the BBC says the 2027-28 figure remains nearly double the 2024-25 core grant of 51.8 million pounds, and that the extra funds will cover maintenance backlogs, cyber security and energy-efficient heating, with 11 million pounds earmarked for Windsor Castle boilers.
The Costs Keep Rising Anyway
The squeeze comes from the other side of the ledger. The report forecasts, for 2027-28 to 2031-32, that income supplementing the Grant will rise from 21.9 million to 27.4 million pounds. Core property maintenance is forecast to rise from 29.3 million to 36.7 million pounds, which the report ties to a maintenance backlog. Payroll is forecast to rise from 33.8 million to 40.8 million pounds, and digital services from 8.3 million to 9.8 million pounds, including the replacement of ageing legacy systems. Clean energy spending averages up to 11.7 million pounds a year, though only one heating system replacement is expected in the period. The Royal Train is due to be decommissioned at the end of 2026-27.
A flat grant against rising costs is a recipe for a squeeze, and the Trustees say so openly. The household will have to find savings, draw on its reserves or raise income from elsewhere, and the report’s own figures suggest the reserves are modest. Our look at the British monarchy’s finances, the Crown Estates and the Sovereign Grant sets out the system for readers who have never met it.
The Reserve Is Thin
The core Sovereign Grant Reserve fell from 15.7 million pounds in 2021-23 to 6.3 million pounds in 2024-25, and rose to 6.5 million pounds in 2025-26. The Trustees can reduce the Grant if the Reserve exceeds 50 percent of annual net expenditure, and a reserve of 6.5 million pounds is nowhere near that line. In practical terms, the household has a cushion, but not a deep one. A single large unexpected repair could use most of it.
What the Public Pays For
The Grant is not a salary for the King. It covers the official expenses of the head of state: the upkeep of the palaces, the staff who run them, the travel and the engagements. It is calculated from the profit of the Crown Estate, a portfolio of property and seabed rights owned by the Crown but managed for the Treasury. That means the monarchy’s public funding depends on the performance of an investment portfolio, a fact that surprises a good many people who think of it as a tax-funded allowance. Our own piece on the monarchy as decorative, expensive and somehow still here puts the common view in a sentence.
What to Read Carefully
Three cautions are in order. First, the figures are the Trustees’ recommendation, not law; legislation is needed. Second, the forecasts to 2031-32 are projections, and Crown Estate profits can change. Third, the Grant is not the whole of the household’s income: the Duchies of Lancaster and Cornwall provide separate private income to the sovereign and the Prince of Wales, and the Sovereign Grant covers official expenses only. A reader comparing numbers across sources should check which of these is being described.
The reporting around the review has also been uneven in tone. Some coverage treats the cut as a sign of reduced extravagance. Others treat it as an accounting adjustment after a spike in Crown Estate profits. The report supports the second reading more than the first: the formula is designed to move with profits, and profits have moved. That is a technical point, and it matters because a headline about a cut can imply a decision to economise when the cause is arithmetic.
What Comes Next
The next steps are procedural. Ministers must introduce legislation to permit the lower figure. Parliament must pass it. And the household must publish its accounts for 2026-27 and 2027-28 showing how it has adjusted. The Royal Family’s own communications are, as ever, measured. Our note on the monarchy quietly googling how to look normal captures the mood outside, which is somewhat less measured.
For more royal coverage in the same register, see our King Charles coverage, and for the wider magazine visit Bohiney Magazine. If you want the same subject with the formality removed, The Daily Mash has always known how to deliver a palace with a straight face. For the serious reader, the useful sentence is the Trustees’ own: a flat grant is a cut by another name.
SOURCE: bohiney.com
