King has opened the books – here’s what we learnt

Mr Chalmers also revealed that the Sovereign Grant would be reduced in 2027-28 for the first time since its inception, a figure that will remain flat for the next five years.

However, the £100m annual payment has almost doubled in the space of three years, from £51.8m in 2024-25.

Meanwhile, aides acknowledged that the potential impact of Labour’s forthcoming mansion tax was being “closely” reviewed.

The palace is looking at which properties could be impacted and to what extent. As landlords, they will be affected.

Sovereign Grant to fall

The Sovereign Grant will fall from £137.9m to £99.9m in 2027-28, a level that royal trustees – outgoing Prime Minister Sir Keir Starmer, Chancellor Rachel Reeves, and Mr Chalmers – decided would ensure that the King’s official duties can continue.

The reduction, said to be “in line with His Majesty’s clear wishes”, will remain flat for five years, with no increases in line with inflation.

It equates to 20.5 per cent of the Crown Estate’s profits, which are expected to stagnate in the coming years as revenue from the sale of offshore windfarm licences ceases.

The Crown Estate, a vast portfolio of property and land – including virtually all of the UK seabed out to 12 nautical miles – belongs to the reigning monarch “in right of the Crown” but is run as an independent business.

It gives all of its profits to the Treasury before a proportion is then returned to the Royal family to fund official duties such as staff costs, official visits and maintenance of occupied royal palaces.

However, Mr Chalmers insisted that it was “not a blank cheque”, with expenditure governed by the same standards and disciplines as any publicly funded body.

The Sovereign Grant was significantly increased in 2017-18 to cover the costs of a major 10-year refurbishment project at Buckingham Palace costing £369m.

Now that the programme is drawing to a close, it will be reduced, as planned.