Rachel Reeves is pressured to make “radical” steps ahead of talks on future funding of the Royal Family by taxpayers. The Chancellor is being urged to tear up a deal that will see nearly £138million of taxpayers’ money handed to the Royal Family this year. It comes as Ministers are set to draw up legislation to cut the Sovereign Grant, the annual taxpayer-funded payment made by the Government to the Royal Household to support the King’s official duties, including staff costs, travel, and palace maintenance. The grant has soared by nearly £50million in three years to pay for Buckingham Palace repairs, sparking controversy, the Daily Mirror reports.
Labour’s anti-corruption tsar Baroness Margaret Hodge said that the Prince Andrew controversy was a turning point, suggesting that a lack of transparency about the royals’ private income could undermine the monarchy during a challenging period. Meanwhile, former Labour minister George Foulkes, who has long campaigned for clarity on how the Royal Family uses public funds, expressed hope that the upcoming King’s Speech taking place on May 13 will introduce broad reforms.
Lord Foulkes told the Mirror: “There’s a growing concern that when a lot of people are finding the cost of living difficult, when there are a lot of people homeless, when there are a lot of people struggling, you see the royal estates and you see the Queen travelling by a helicopter to a race meeting (at the Plumpton Racecourse), it’s getting increasingly unacceptable.
“And so it really needs to be a rather more radical review than it has been in the past.” The Treasury has confirmed the amount the royals receive is being looked at as part of a five-year review process..
However, there are no plans to rip up the Sovereign Grant arrangement brought in by George Osborne in 2011 and which Baroness Hodge thinks has “run out of time”.
She added: “It’s now the time for it to be reviewed, and I think she (Ms Reeves) is reviewing the terms of it. One would hope that they will come back with something that cuts that, so it reflects what’s happening in the rest of Britain.”
“Right through the whole of austerity, when all public services were being cut, they were getting more and more Sovereign Grant.”
The Treasury last month confirmed the Sovereign Grant, which was £132.1 million in 2025/26, has gone up to £137.9million this financial year. It rose by £45.8million from 2024/25 – a surge to help fund £369million of repairs to Buckingham Palace over a decade.
According to Treasury Minister Lord Livermore, Labour intends to “bring forward legislation to reset the Grant to a lower level from 2027-28 once Buckingham Palace reservicing works are completed.”
A Buckingham Palace spokesperson told the Mirror: “The Sovereign Grant is reviewed every five years by the Royal Trustees, which include the Chancellor, to ensure the level of funding for the Royal Household remains appropriate to support the official duties of The Sovereign in his roles as Head of State, Nation and the Commonwealth. Each year the Royal Household publishes a report setting out how the Sovereign Grant is spent, and the Sovereign Grant accounts are audited by the National Audit Office.”
The Daily Express has reached out to the palace for a comment.
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