The Treasury should be doing more to help the Queen sort out her finances according to a report from the Public Accounts Committee (PAC), which says the monarch's household is spending more than its income while failing to cut costs and leaving a number of royal properties in a poor state of repair.

PAC looked at the operation of the Sovereign Grant, introduced in 2012, which covers the staffing costs of the royal household, maintaining the royal palaces, and the costs of royal travel. This was set at £31m in 2012-13 and is due to rise to £36.1m in 2013-14 and to £37.9m in 2014-15.

MPs want the royal household to get better at planning and managing its budgets for the longer term, pointing out that it overspent its income from the grant and other sources by £2.3m in 2012-13, with the balance then drawn down from its reserve fund. As a result, there is just £1m put aside for emergencies, a historically low level of contingency.

The committee said the royal household should do more to generate additional income, which increased to £11.6m in 2012-13, compared to £6.7m in 2007-08. MPs also wanted to see cost cutting at the palaces, saying that while the household's net costs have reduces by 16% in real terms since 2007-08, of this 11% was achieved by increasing income, and just 5% by reducing expenditure.

There is also criticism of the state of some of the royal heritage, with 39% of the monarch's property assessed as below an acceptable standard and some buildings classed as in a 'dangerous or deteriorating condition' because of a maintenance backlog and failure to cost and plan for repairs.

PAC chair Margaret Hodge said: 'The Queen has not been served well by the household and by the Treasury, which is responsible for effective scrutiny of the household's financial planning and management. We believe that the Treasury has a duty to be actively involved in reviewing the household's financial planning and management - and it has failed to do so.'