The British authorities have announced that next year they will reduce the percentage of funds transferred to the royal family from The Crown Estate. “The new sovereign grant rate reflects an unexpected significant increase in net profits,” said Finance Minister Jeremy Hunt.
The British government announced on Thursday that it would reduce the percentage of funds transferred next year royal family from The Crown Estate, which is as requested King Charles IIIwho wanted the additional profits from wind farms to be used for the public good.
Each year, the royal family receives a grant for the sovereign to maintain the palaces and their staff, pay for the performance of duties or cover official travel expenses.
It is calculated on the basis of the profits made by The Crown Estate – a commercial company that manages real estate that is hereditary “public property of the sovereign” – i.e. not his personal property.
The profits from its activities go to the state budget, but a fixed percentage is transferred to the royal family as a grant to the sovereign.
The usual percentage is 15%, although it has been temporarily raised to 25% in recent years to finance the extensive renovation of Buckingham Palace. Its current value is £86.3m.
But due to agreements signed in January to build six wind farms on land managed by The Crown Estate, the company’s profits are expected to increase by around £900m a year.
After concluding these agreements, Charles III expressed the wish that the additional profits accruing to him on this account should not be allocated to a grant for the sovereign, but for the public good.
Decreased percentage of profits from The Crown Estate
As a result, on Thursday, the UK’s Treasury announced that the percentage of The Crown Estate’s profits going as a grant to the sovereign would fall to 12 per cent next year.
This means the grant will still be worth £86.3m, but if the rate remained at 25%, it would probably be £24m higher next year and £130m higher in 2025-2026. These surpluses will instead go to the state budget.
“The new sovereign grant rate reflects the unexpected significant increase in The Crown Estate’s net profits from offshore wind development, while providing sufficient funds for official operations as well as essential property maintenance, including the completion of the 10-year renovation of Buckingham Palace,” said Finance Minister Jeremy Hunt.
The decision on what percentage of The Crown Estate’s income goes to the Sovereign’s Grant is made by the Prime Minister, the Finance Minister and the Keeper of the Royal Treasury, not the Monarch.
Main photo source: MALCOLM PARK / Avalon /PAP