Buckingham Palace officials have demanded a seven -figure increase in the Civil List -- the annual 7.9 million pounds which the Queen gets from the Parliament to maintain spending on state duties, the 'Daily Mail' reported.

The 7.9-million-pound grant covers the cost of the official royal household, from banquets and furnishings to housemaids and footmen.But, the Queen's official budget is estimated to be overspent by six million pounds a year. It is being covered by a 35-million-pound emergency reserve, expected to run out by 2012 -- the Majesty's Diamond Jubilee Year.
The civil list is negotiated every ten years and the Government has to report to Parliament on the grant by July 3 at the latest, the report said.

Courtiers say the Queen should, at least, expect a hike to her annual funding which takes account of inflation over the past two decades. Prices have soared by 80 per cent in that time.

The current level of the civil list was agreed by former prime minister John Major when he was chancellor of the exchequer in 1990, and frozen by Tony Blair in 2000."The Queen has only been able to manage by very prudent financial management and by drawing on reserves," one royal courtier was quoted as saying.|

The monarchy costs more than 41.5 million pounds a year in public funds, excluding the cost of security. About 70 per cent of the 7.9 million pounds civil list expenditure goes on staff salaries. It also pays for official functions such as garden parties, receptions and entertainment.