Media playback is unsupported on your device Media caption A third of the Sovereign Grant is spent maintaining the royal palaces

The Queen's income is expected to rise by more than 5% next year after the Crown Estate announced record profits.

The Sovereign Grant, which covers the costs of the Queen's official duties, will reach £40m next April.

The grant is calculated as a percentage of profits from the Crown Estate, which includes properties such as Windsor Park and much of the UK coastline.

Meanwhile, Buckingham Palace accounts show about a third of the grant is spent maintaining the royal palaces.

'Disrepair'

The accounts, also published on Thursday, show that more than £4m has been spent on converting offices in Kensington Palace into an apartment for the Duke and Duchess of Cambridge and Prince George.

The work included the removal of asbestos, new heating, hot and cold water, electrical services and a "simple redecoration".

The furnishings and a new kitchen had been paid for privately by the Royal Family, a palace official said.

Image copyright Jason bell/camera press Image caption The Duke and Duchess of Cambridge paid for the furnishings of their new apartment

A Kensington Palace spokesman said: "Before the project started, the residence was in a state of disrepair.

"It was last refurbished in 1963."

Spending on property maintenance increased by £4.2m to £13.3m, the accounts show.

In January, the Commons Public Accounts Committee warned of a maintenance "backlog" with some properties in a "dangerous or deteriorating condition".

We take our responsibility to run as efficient an operation as possible Sir Alan Reid, Keeper of the Privy Purse

'Efficient operation'

Travel expenditure was also revealed, including the £255,000 cost for the Prince of Wales to attend Nelson Mandela's funeral. Palace officials said that was due to the complexity of getting him to a relatively remote location at short notice.

Buckingham Palace said the cost of the monarchy - not including security - was equivalent to just over a penny a week for every person in the United Kingdom.

Under a formula set in 2012, the Sovereign Grant rose to £37.9m in April and will go up a further 5.7% to £40m in the next financial year.

It is tied to the income from the Crown Estate, which has published record profits of £267m.

Aside from the Queen's income, the rest of the profit goes to the Treasury.

Sir Alan Reid, keeper of the Privy Purse, said public funding of the monarchy had fallen by 8% in real terms in the last two years when maintenance costs are stripped out.

He added: "We take our responsibility to run as efficient an operation as possible.

"In our view we think that we do as good a job as possible in terms of trying maximise the value for money."

But Graham Smith, chief executive of the group Republic which campaigns for the abolition of the monarchy, said: "The job of reporting royal finances needs to be taken out of the hands of the palace and given to some honest brokers.

"The spin has to stop, the excuses have to stop, the royals need to be held to account for their profligacy."