Campaigners today called on the government to resist the Queen's demands for an increase in the Civil List and has said the costs of the monarchy must be slashed.
The Queen, who is also the Supreme Governor of the Church of England, has a reserve of public funds which is set to run out by 2012, according to Buckingham Palace accounts published today (Monday).
This has raised expectations that the government will be asked to increase the Civil List, which pays for the running of the royal household.
The Queen has used up £6m from the cash reserve to boost the Civil List. The amount is the largest ever drawn from the reserve of surplus cash from the list.
Palace officials have complained that they lack funds to properly maintain some royal residences. They once claimed that part of the facade of Buckingham Palace was in such bad repair that a chunk fell off, narrowly missing Princess Anne.
However, Buckingham Palace is only open for 63 days a year for the public to visit, leading to calls that it should follow the example of the US White House and open up all year round, so enabling it to pay for some of the costs incurred.
The total cost to the taxpayer of keeping the monarchy increased by £1.5 million to £41.5 million during the 2008-09 financial year. This, the Palace pointed out, was effectively 69p per British person last year and an increase of 3p on the previous year. The Civil List was £13.9 million last year, 43 per cent of which came from the Queen's reserve.
But Republic spokesperson Graham Smith told reporters: "The Queen constantly complains that she doesn't have enough cash to maintain the royal residences. This is deceitful spin designed to distract attention from the huge cost of the monarchy.
"Every year the palace press office tries to justify the cost of the monarchy by dividing the official figure by 60 million - claiming the cost to the taxpayer is under 70p."
"With that sort of accounting you can justify pretty much anything. Would MPs get away with justifying their salaries and expenses by saying they cost us less than the price of a pint?"
"MPs' expenses pale in comparison to the travel costs revealed in today's report” he continued. "The Queen charged the taxpayer £16,000 to take the train from Windsor to Totnes and £14,000 to travel from London to Liverpool."
"Meanwhile, Charles and Camilla's junket to South East Asia cost us a staggering £656,000. We even paid £149,000 for the Duke and Duchess of Gloucester to go to Tonga. These luxury trips bring no tangible benefits to the UK."
"The royal household is currently spending more money than it gets, but that's down to stubbornness and financial incompetence, not a lack of funds. They refuse to extend Palace opening hours and haven't even got a business plan."
If the Queen continues drawing on the reserve at the current rate, she will run out of funds by 2012 – the year of her diamond jubilee. The fund has gone down from £35 million to £21 million over the last decade. The current deal – in which the Queen gets £7.9 million a year – was agreed by Sir John Major in 1990. The arrangement expires in 2010.
An ICM poll, carried out for Republic, showed that 62 per cent of those questioned want the royal finances to be subject to the same scrutiny as MPs' expenses.