Budget: Civil list frozen at £7.9m

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Delivering his first Budget statement to the House of Commons, Mr Osborne said the freeze was made with Her Majesty's full agreement.

A new means of support for her will be proposed at a later date, he added.

He said: "The amount provided by the Civil List has remained unchanged over the last 20 years at 7.9 million.

"This has required careful management. Because of inflation, the annual payment is today worth only a quarter of what it was 20 years ago.

"I can announce that with the full agreement of the Queen, the Civil List will remain frozen at 7.9 million for the coming year and I will propose a new means of consolidated support for Her Majesty for the future at a later date."

The royal households have agreed that in future, Civil List expenditure will be subject to the same audit scrutiny as other Government expenditure through the National Audit Office and the Commons Public Accounts Committee, he added.

Mr Osborne said: "I believe this will mean clear accountability in this House and it will strengthen public confidence."

He paid tribute to the Queen's "loyal service and immense contribution to public life."

The Civil List pays for staff costs and running expenses of the Queen's household and is set every 10 years. A revised figure was due this year.

The Queen was reported last month to have asked for an increase in taxpayer funding.

The sum paid to her household was raised to 7.9 million a year by Sir John Major in 1990 but frozen in 2000 following a deal with the Treasury to compensate for 10 years of over-generous payments.

The Sunday Telegraph reported that Buckingham Palace had told Government officials that spending was now 7 million above the annual limit and that the surplus would run out in 2012.

But a cross-party group of MPs is understood to have backed a call for a freeze.

An ICM poll commissioned by Republic, a group campaigning for a democratic alternative to the monarchy, showed 56% of people opposed an increase in the Civil List.

The results, published yesterday, revealed that just 28% believe the Queen should receive more money from taxpayers.

The Queen and the Duke of Edinburgh are the only members of the Royal Family to receive a Parliamentary allowance each year.

The funding dates back to 1760, when King George III agreed with the Government that the Crown Lands would be managed on the Government's behalf, with surplus revenue going to the Treasury.

It was agreed that the King would receive a fixed annual payment in return, which later became known as the Civil List.

About 70% of the funding is used to pay staff salaries. The money is also used to help fund official functions such as garden parties, receptions and entertainment during state visits.

The Royal Household employs about 1,200 staff, including caterers, gardeners, secretaries, press officers, property surveyors and furniture restorers.

The Queen entertains nearly 50,000 people each year.