The Queen and Prince Philip, who have been married for 72 years so far, have always had to move with the times and modernise the institution of monarchy. In 1986, they called in Gerrard Airlie and Michael Peat to revolutionise the Palace’s finances and organisation. The final report, with 188 recommendations for change, had long-ranging significance for the Royal Family and the way their royal residences are run.

Royal author Penny Junor, in her 2005 book “The Firm” explains the process and Her Majesty’s stunned response to the initial report. 

Ms Junor writes: “It was a major undertaking which took a full year, but in 1987  Peat came up with a report that ran to 1383 pages, with no fewer than 188 recommendations for change. 

“They were wide-ranging but fundamentally changed the working practices of every department in the Palace, from the dining arrangements to the way in which the private secretaries operated.” 

At breakfast, when the Queen was presented with the report, Ms Junor writes that her stunned response was: “Why have I got so many footmen?”

A former aide told the author about Palace life before the reforms saying: “It was all rather stuck in the mud, in a time warp.

“The Palace was still recruiting from certain sections of society and the Queen hadn’t been particularly well-served.

“There was a country house atmosphere; things were being done in the same way they’d been done for 20, 30, or nearer 100 years – since Prince Albert’s time, probably.

“There were some excellent individuals there, who had no doubt wanted to move things forward a bit, but there had never been concerted pressure to do it.”

|n addition to changing the day-to-day organisation of the Palace, the report also reformed the Civil List and brought the maintenance of royal residences under the financial control of the Palace.

Replaced by the Sovereign Grant in 2012, the Civil List was the sum given to the Queen annually by the Treasury for royal expenditure.

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Under Peat and Airlie, the Treasury agreed to grant the Civil List on a ten-year basis, with the Palace managing the funds itself.

However in 2012, the Civil List and other grants were consolidated into the Sovereign Grant which is now paid on a yearly basis.

When the 2012 reforms were put into effect, Princess Beatrice and Princess Eugenie were taken off royal funding completely reportedly to the chagrin of Prince Andrew.

 Then, in 2016, the Duke of York was said to be furious when his written request to the Queen asking that the princesses be funded by the Sovereign Grant was turned down.

The Sovereign Grant has again been under public scrutiny in recent months, as expenditure on large-scale renovations in Buckingham Palace increased the grant to £82.2million from 2018-19, compared to £76.1million in 2017-18.

The £2.4million renovation of Frogmore Cottage, the familt home of Prince Harry, Meghan Markle, and Archie, was also the subject of public debate when the financial report was released in June.

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