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Sovereign Grant Bill Clears Parliament: Royal Funding Reset

Peers passed the Sovereign Grant Bill unamended on 14 October, cutting royal funding to £99.9 million for 2027-28. What changes and what comes next.

ByPeter Peters
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The Sovereign Grant Bill, which sets the public money provided for the monarch’s official duties, completed its passage through Parliament on 14 October. The House of Lords took its second reading and every remaining stage in a single sitting and passed it without amendment, according to Hansard. The bill resets the grant at £99.9 million for 2027-28, down from £137.9 million this year, and now needs only Royal Assent to become law.

At a glance

  • Bill: Sovereign Grant Bill, a government bill amending the Sovereign Grant Act 2011 (bills.parliament.uk).
  • Votes: none. Both Houses agreed each stage without a division (a formal recorded vote).
  • Next: Royal Assent, the monarch’s formal approval that turns a bill into an Act. No date had been announced as of 14 October.
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What the bill does

The grant pays for the staff, official travel, property upkeep and services behind the monarch’s official duties. Under the 2011 Act, the amount is calculated from earlier spending and a percentage of the profits of the Crown Estate, an independent property business whose net revenue goes to the Treasury. Three officials known as the royal trustees (the Prime Minister, the Chancellor of the Exchequer and the Keeper of the Privy Purse) review the formula regularly.

Parliament had agreed a temporary increase from 2017-18 to 2026-27 to pay for the Buckingham Palace “reservicing” programme, a 10-year replacement of the palace’s electrical and mechanical systems. The minister said the trustees concluded this year that, with that work nearly finished, the case for the uplift “no longer existed.” The bill:

  • Sets the grant for 2027-28. The cut of almost £38 million is “more than a quarter,” Treasury minister Lord Pitt-Watson told peers, and the new level is expected to last five years.
  • Changes the formula for later years. Labour MP Neil Duncan-Jordan told the Commons this means a rise from 12% to 20.5% of Crown Estate profits.
  • Adds limited flexibility to adjust funding, within a year or from year to year, when exceptional circumstances would leave it “inappropriately low or high,” in the minister’s words.

Where it stands

  • 1 September: first reading (formal introduction) in the Commons.
  • 14 September: the Commons took second reading, committee of the whole House and third reading in one day, without a division. A Liberal Democrat amendment was debated, and the bill was reported without amendment (Hansard).
  • 15 September: first reading in the Lords.
  • 14 October: Lords second reading, then the remaining stages. Hansard records “Committee negatived” (no committee stage was held) and that the bill “was read a third time and passed.”

Labour peer Lord Foulkes of Cumnock noted that the Speaker of the House of Commons had designated the measure a money bill, which he said meant peers were “not in a position to table any amendments.”

What supporters and critics say

Lord Pitt-Watson said the bill “delivers a fair and proportionate funding settlement” and would still cover a maintenance backlog and new digital systems. For the Conservatives, Baroness Neville-Rolfe said the official opposition supports it, and Lord Redwood welcomed the cut while warning the future formula must cover “legitimate increases in costs.” Liberal Democrat Baroness Kramer said her party would back the bill, but questioned tying future grants to a fixed share of Crown Estate revenue that varies year to year.

Several Labour peers were critical. Lord Foulkes called the link to Crown Estate profits a “heads I win, tails you lose” system and said the Royal Household should submit an annual budget request like any other public body. Lord Sikka said core funding, excluding palace refurbishment money, rises from £51.8 million in 2024-25 to £99.9 million in 2027-28, “an increase of 97%.” Lord Berkeley said the trustees “appear to be marking their own homework.”

In the Commons on 14 September, Liberal Democrat Bobby Dean’s amendment would have required a National Audit Office value-for-money assessment and a Commons vote before any future increase in the Crown Estate percentage (Hansard). Labour MP Brian Leishman said the money “could and should be directed elsewhere.” Treasury ministers replied that the trustees work from a “bottom-up assessment” of the Household’s needs, and Lord Pitt-Watson told peers the grant’s accounts are audited by the National Audit Office and laid before Parliament.

Analysis: The main front benches backed the bill, and no vote was forced. Debate in both chambers centred less on the lower figure than on how future grants are calculated and who checks them, questions this bill leaves open.

What happens next

Because the Lords made no amendments, the bill does not return to the Commons. It goes for Royal Assent, which is announced in both Houses; the Act then appears on legislation.gov.uk. The new level applies from April 2027, the start of the 2027-28 financial year. Follow this and other bills on our tracker below.

Sources

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