Sovereign Grant Bill

Chris Vince Excerpts

Committee of the whole House & 3rd reading
Monday 14th September 2026 Commons Chamber

[The Exchequer Secretary to the Treasury (Dan Tomlinson)]

I will turn briefly to each of the short clauses in the Bill.

Clause 1 gives effect to the central purpose of the Bill. It sets the amount of the sovereign grant for the financial year 2027-28 at £99.9 million. In doing so, it resets the level of the grant following the completion of the Buckingham Palace reservicing programme. As that programme nears completion, the temporary funding associated with it is no longer required. Both the previous Government and this Government recognised that the level of the grant should therefore be reset and that legislation would be necessary to achieve that outcome. That is what clause 1 does: it establishes a grant of £99.9 million for 2027-28, reflecting the conclusions of the 2026 royal trustees review. The practical effect, therefore, is that funding falls from £137.9 million in this financial year to £99.9 million in 2027-28.

[Chris Vince (Harlow) (Lab/Co-op)]

Thank you, Madam Chair. I desperately tried not to intervene at all, but I could not stop myself. I was on the Modernisation Committee when it had the opportunity to visit Buckingham Palace to see some of the regeneration work being done. Does the Minister feel as reassured as I do that the renovation work was done as efficiently and practically as possible, bringing in apprentices from elsewhere—I do not think any of them came from Harlow, unfortunately—to ensure it was successful?

[Dan Tomlinson]

My hon. Friend is right to highlight that the works on Buckingham Palace over the past 10 years have been carried out with efficiency and effectiveness. In fact, the National Audit Office took a look at the programme of work and was able to commend it for its effective use of taxpayer money, which is of course very important. Clause 1 delivers, therefore, the intended reduction in funding following the completion of that work, and implements the conclusions of the royal trustees review to establish a new baseline for future years.

Having reset the grant for 2027-28, clause 2 turns to the framework that will determine grant funding in future years. The grant has, since 2012, been linked to the performance of the Crown Estate. That underlying principle remains unchanged by the Bill. Clause 2 updates the percentage of Crown Estate profits used within that calculation, so that the framework remains appropriate after the grant has been reset through that bottom-up calculation. It sets the relevant percentage at 20.5%. Returning to conversations we had on Second Reading, I want to reassure Members that that figure is not arbitrary. It comes directly from the conclusions of the June 2026 royal trustees review, which assessed both the royal household’s expected expenditure requirements and the Crown Estate’s forecast revenues over the period 2031-32.

Clause 3 introduces targeted safeguards to ensure that the funding framework can continue to operate effectively in exceptional circumstances. This is to ensure that where royal trustees conclude that the amount produced by the statutory formula would result in the sovereign grant reserve falling below 10% of annual expenditure or exceeding 50% of annual expenditure, and where the existing framework can adequately correct that outcome, the trustees must explain that conclusion in their annual report and identify the new amount they believe would be appropriate. The Treasury must then implement that through regulations. This reform allows greater flexibility to prevent reserves becoming either too large or too small, and it means that action can be taken before reserve levels move outside of a sustainable range, rather than waiting until existing statutory mechanisms have been triggered.

The second mechanism is a limited power to increase the grant during a financial year in genuinely exceptional circumstances, and is intended as an emergency power. It can only be used when unforeseen circumstances arise during a financial year that cannot be reasonably addressed through the normal annual funding process. Clause 4 contains standard provisions relating to commencement and the short title of the Bill; I commend this and all other clauses to the Committee.