Profits transferred to royalties more than doubled from the previous year
A new report on the British royal family’s finances, published this week, revealed good news for the royals, who have been recently destabilized by illness and injury. Profits for the Crown Estate, which looks after the royal family’s property and possessions, rose to £1.1 billion from £442.6 million a year earlier.
The annual report says the increase in revenue is due to the leasing of offshore sites to offshore wind energy producers. The money the royal family receives from the government (called the sovereign grant) will rise to £132m in 2025-26, up from £86.3m in recent years. The information was reported by the New York Times.
For centuries, the net profits of the Crown Estate were paid to the government in exchange for a fixed annual payment to the royals. Since 2012, however, this payment has become the sovereign subsidy, calculated as a percentage of estate profits.
A request from King Charles III called for the increased profits made from wind energy to be used for the “public good.” As a result, the previous government agreed to reduce the sovereign subsidy to 12% of net profits from this year onwards, instead of 25%.
If the subsidy had remained at 25%, the king would have received £275 million instead of £132 million, a significant increase, which could have undermined the popularity of the royal family.
The profit increase would be “short-term in nature,” according to Crown Estate CEO Dan Labbad. However, he says revenue and valuations will normalize over the next few years.
Another report on the monarchy’s funding, published by the royal household on the same day, said that the number of visits to Buckingham Palace and Windsor Castle had returned to “pre-Covid levels” within a year, up to April 2024. This would have helped boost the royal income source to £19.8 million, double the previous year.
Reform and improvements
The report also detailed the costs of a work project to refurbish Buckingham Palace, as well as modernising Windsor Castle. Replacing the pumps and water tanks at Windsor cost £465,000 for the year, for a total of £10.59 million to date.
The UK’s National Audit Office, which is responsible for monitoring public spending, said on Tuesday that the royal family had managed the £369 million project to renovate Buckingham Palace well, but added that some projects had overrun. Work on the palace’s east wing was completed two years late and was 78% over its estimated cost.
This was due to the pandemic and inflation, but also to structural damage and the discovery of asbestos in the building. The problems could have been foreseen, according to the supervisory body.
Royal Family casualties have impacted the budget
In the palace report, the annual operating expenditure account details how the king has spent the sovereign grant and how the family will achieve its goals through royal engagements, charities and events.
The royals attended 2,300 engagements in the UK and abroad. That’s far below the total from the year before the pandemic, when the Queen and her family managed 3,200 engagements.
The number of royals allowed to attend events has declined in recent years, after Prince Harry and his wife Meghan stepped down from their roles in 2020 and following the deaths of Prince Philip and Queen Elizabeth.
King Charles and Kate Middleton’s cancer diagnoses forced them to withdraw from public appearances, although the king continued to carry out his constitutional duties. After nearly three months, Charles resumed his public duties in April, while Kate appeared in public for the first time last month during a ceremonial parade in London.
The report states that, following the announcement on the health status of the King and Princess, the reduction in public engagements is expected to continue and, consequently, continue to impact the budget, until they resume.
As of April, the king has made 464 official engagements. The report also indicates the number of messages the king and princess have received by mail wishing them well after the health announcements: 27,620.
Another goal of Buckingham Palace is to increase the diversity of its workforce. The palace said that 11.4% of its staff are from ethnic minorities, but that number is still below its target of 14% by 2025. The average gender pay gap has narrowed from 4.2% to 2.2%, according to the document.
Source: Terra
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