How much does it cost to live like British royalty? At least ￡67 million ($85.2 million) a year, according to figures released by Buckingham Palace last week.
What’s more, it’s becoming more expensive: in the most recent fiscal year, costs jumped by ￡19.6 million ($25 million), or 44%, on the previous year.
So what’s behind the bump? Put it this way: palace renovations don’t come cheap.
The royal purse
But first: where does the money come from?
The British Royal Family has had a special deal with the U.K. government since King George III agreed to surrender his net income in 1760 in return for a fixed annual payment. This has been amended many times over the generations and was most recently renegotiated in 2011.
It works like this: The Royals hand over all of the profits from their vast Crown Estate property portfolio, which is one of the U.K.’s largest, and includes assets such as Windsor Great Park, Ascot racecourse, and a mixture of residential and commercial properties stretching from London to the farthest ends of Scotland and Northern Ireland.
The U.K. government then returns to the family a fixed payment of around 15% of this total income through a ‘Sovereign Grant.’ This money, which otherwise would’ve gone to the public, funds the running of the Royal Household: staff payroll, official visits, hospitality and housekeeping, and the upkeep of the various royal palaces.
In 2019, Queen Elizabeth II received a Sovereign Grant of ￡49.3 million ($63 million), plus a special additional grant of ￡32.9 million ($42 million) towards the extra costs of restoring Buckingham Palace—a total of ￡82.2 million ($104 million). Of that, the Royal Family spent ￡67 million. Those sums eclipse the previous year’s: ￡76.1 million ($96.8 million) in grants, with a net expenditure of ￡47.4 million ($60.3 million).
A crumbling palace
This year’s largest additional cost is currently fixing up Buckingham Palace. Along with crumbling walls and a leaky roof, a 2016 report from the Royal Trustees—who include the prime minister and chancellor of the Exchequer—found the Palace’s electrical, plumbing and heating systems had not been updated since the 1950s. At a total cost of ￡47 million ($60 million), that amounts to 57% of the total annual budget.
To address the situation, a ten-year renovation plan was mapped out to upgrade the Palace’s infrastructure to 21st century standards and make it more accessible to the disabled through the creation of extra elevators. It’s also getting a new energy system and more office space. This has seen staff, members of the Royal Family, and over 3,000 works of art move out of the Palace’s East Wing, in order to create a vacant space for the renovation work.
Harry and Meghan get a fixer-upper
Another Royal Family money pit: the five-bedroom Frogmore Cottage gifted to Prince Harry and Meghan Markle by the Queen in May 2018. While it sits in an idyllic, secluded corner of the Windsor Estate—and close to a collection of giant redwoods from Markle’s native California—it had one major problem. Since its creation in the mid-1800s, the cottage had been repurposed into five small dormitory-style units, meaning that extensive construction work was needed to turn it into a single, modern home fit for the official residence of the Duke and Duchess of Sussex.
These renovations have cost the U.K. taxpayer ￡2.4 million ($3 million), largely because most of the ceiling beams and floor joists had to be replaced, while heating, water and gas systems also had to be relaid to suit a single home. Despite reports in the U.K. press, the work did not include a yoga studio.
The home is now undergoing maintenance on its exterior doors, windows, and walls, and further works on the garden are expected—though the Duke and Duchess of Sussex will pay for those themselves, alongside décor, furniture, and any upgrades considered too expensive for the public purse. So, while the British taxpayer may foot the bill for a cottage that won’t crumble, they won’t be paying the bill for updating the kitchen.
It pays to be royal
Who does pay for that kitchen? Prince Charles, or at least his estate.
The Royal Family don’t have to ask the British taxpayer to sign off on all their income. The Duchy of Cornwall, a private estate held by the heir to the throne, has a vast portfolio of land in southeast England, stretching across farmland and coast, and containing residential and commercial properties. The profits from that land are used to pay the private expenses of the Duke and Duchess, wife Camilla, as well as his children, William and Harry, and their families.
If the Queen wants to update her kitchen, she too has a private source of funds: her own portfolio of land under the Duchy of Lancaster, which owns land across Wales, London, and northern England.
These are all considered private funds, and while the Queen and Prince Charles voluntarily pay some tax, it still leaves them with a tidy sum to fund their private lives.
That means that when it comes to living like a Royal, $85.2 million is likely just a fraction of the bill.