The British royal family is facing a £35 million ($44.5 million) hit to its finances as a result of the coronavirus pandemic.
Michael Stevens, the keeper of the privy purse, who essentially manages the royal family’s finances, said the coronavirus would impact the “sovereign grant” that the monarchy receives from the government, funded by taxpayers.
Annual profits from the Crown Estate, essentially the royal portfolio of property and land, from the two years’ previous is factored into calculating the sovereign grant.
Stevens explained in a briefing, ahead of the release of the royal family’s annual financial report on Friday, that the Crown Estate had forecast its net profit for this year would fall “significantly.”
The sovereign grant cannot fall, he added, but this does mean for 2022/23 it would be held at £86.3 million — it stood at £82.4 million this year.
As a result, Stevens said the refurbishing project on Buckingham Palace was forecast to receive over £20 million less in funding from the sovereign grant. The 10-year project was agreed to cost £369 million but the shortfall in funding means a total of £349 million will be spent on the work at the palace.
The Royal Collection Trust, or RCT, which is the charity that maintains the monarchy’s art collection and is funded by visitor admissions to occupied royal palaces, would also be affected, Stevens said. The RCT supplements the sovereign grant.
A fall in visitors due to the pandemic was therefore expected to mean a “significant” drop in income for the RCT.
“This forms the bulk of a projected shortfall in income which we estimate will be around £5 million per year for the next three years,” said Stevens, equating to another £15 million on top of the £20 million shortfall from the sovereign grant.
Stevens added: “In responding to these challenges, we have no intention of asking for extra funding but will look to manage the impact through our own efforts and efficiencies.”
Buckingham Palace is reportedly not planning any layoffs and will instead cover the losses using efficiency savings.