The renovation of the country’s most popular attraction will cost British taxpayers £369m, the government announced on Friday.
During the period of the refurbishment, the Queen will remain in residence.
The treasury has given the go-ahead for essential works that include replacing electrical wiring, water pipes and the heating system, which were installed in the aftermath of the Second World War.
Full refurbishment will be funded by a temporary increase in the Sovereign Grant, as recommended by the Royal Trustees, among whom are the prime minister and the chancellor of the exchequer.
The cash has been approved by Prime Minister Theresa May and Chancellor Philip Hammond and is expected to be approved by Parliament in the next six months.
Buckingham Palace is visited by more than half a million people every year during its summer opening and millions of tourists flock to its gates every year to see the Changing of the Guard.
In addition, the palace hosts more than 90,000 people every year, for a range of official events from small receptions to state visits and garden parties. In the last year alone this has included Team GB’s Olympic and Paralympic champions, Sir David Attenborough and Oscar-nominee Salma Hayek.
The renovation work will prevent serious risks of fire, flood and damage to both the building and the priceless Royal Collection of art belonging to the nation. Another historical building, Windsor Castle, suffered a fire in 1992, which raged for nine hours and devastation large parts of the building. The restoration took more than five years, and it is estimated that similar damage to Buckingham Palace could cost up to £250 million for a single wing.
The overhaul will also help to significantly improve visitor access, especially to schools, to help open up the Palace and its treasures even further to the public.
The palace has served as the official London residence of Britain's sovereigns since 1837. It is here that Britain’s monarchs have played host to historical figures, including the author Charles Dickens, US Presidents Woodrow Wilson and John F Kennedy, India’s founding father Mahatma Gandhi, astronaut Neil Armstrong, South African leader Nelson Mandela and others.
The government has made it clear, though, that significant national events such as the Changing of the Guard, Trooping of the Colour and Garden Parties must continue throughout this period and the palace should remain open to visitors.
The Chief Secretary to the Treasury, David Gauke, said: “Tourists are drawn to this country because of our culture, heritage and royal legacy, and when they visit they spend billions of pounds and support thousands of jobs. We must ensure that the special architectural and historic nature of some of our greatest buildings is protected for future generations. Therefore, it is only right we ensure Buckingham Palace is fit for purpose.”
He said, “We will ensure every penny spent achieves the greatest value for money.”