The leaner monarchy that has been proposed by Charles for cost-cutting purposes "included Harry and whoever he married," adds a palace insider

Although tensions within the royal family are high, senior members want to help Meghan Markle and Prince Harry find contentment following their decision to step down from their roles.

Palace sources tell PEOPLE in this week’s cover story that there is a firm determination within the palace to understand Meghan and Harry’s position and help them get to a place where they feel comfortable and happy.

Despite a focus within the palace on the direct line of succession — highlighted most recently in a holiday portrait of the Queen, Prince Charles, Prince William and 6-year-old Prince George — those close to Charles deny reports that he sought to slim-down the monarchy by squeezing out his younger son and daughter-in-law.

“Charles has always envisioned working with both of his sons and their families in the future,” says a close source. The leaner monarchy that has been proposed by Charles for cost-cutting purposes “included Harry and whoever he married,” adds a palace insider.

Prince Harry Meghan Markle People Magazine Cover

Observers say the royal family will seek to make things right. “For public and also for deeply private reasons, the Queen, and Prince Charles and Prince William will want to heal the rift,” says royal historian Robert Lacey, author of the books Monarch and Majesty, tells PEOPLE in this week’s cover story. “There is anger at the moment. But if Harry and Meghan are prepared to enter into the spirit of this new arrangement” —making sure not to appear to cash in on their titles and reputations—“I think the Queen, Charles and William will [support them]. Each of them, for different reasons, will want to heal what has gone wrong.”

Preliminary talks of Prince Harry, 35, and Meghan, 38, changing their roles — and splitting their time between the U.K. and Canada — had been underway for weeks. However, Queen Elizabeth had asked that the couple refrain from sharing their plans publicly until the complexities could be discussed.

100th Anniversary of the Royal Air Force, Westminster Abbey, London, UK - 10 Jul 2018
Credit: David Fisher/REX/Shutterstock

But when the news leaked, “Harry felt all bets were off,” says Harry’s longtime friend and journalist Tom Bradby.

The 93-year-old monarch was given the couple’s statement just 10 minutes before it was released to the world.

Prince Harry, Duke of Sussex and Meghan, Duchess of Sussex arrive at Canada House on January 07, 2020 in London, England
Meghan Markle and Prince Harry
| Credit: DANIEL LEAL-OLIVAS/AFP via Getty

Penny Junor, author of Prince Harry: Brother, Soldier, Son, says Harry “knows the Queen is incredibly tolerant when she is kept in the picture, and she hates surprises. It is a firm, and they are all working for the benefit of the monarch. As an Army man, he should get that.”

“I understand that he or Meghan might feel life had become intolerable in the U.K.,” she adds. “But to do things in this way is a real kick in the teeth.”

Queen Elizabeth, Meghan, Harry
Prince Harry, Queen Elizabeth and Meghan Markle
| Credit: Max Mumby/Indigo/Getty

But a source close to the royal household counters, “Harry knows about service, but what he can’t cope with is a wife in distress.”

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Meghan and harry
Meghan Markle and Prince Harry
| Credit: Dominic Lipinski/PA

Queen Elizabeth called Prince Harry, Prince William and Prince Charles to come together for a meeting on the matter at her Sandringham home on Monday. Following the 90-minute summit, she released a remarkably personal statement.

“Today my family had very constructive discussions on the future of my grandson and his family,” the Queen said. “My family and I are entirely supportive of Harry and Meghan’s desire to create a new life as a young family. Although we would have preferred them to remain full-time working Members of the Royal Family, we respect and understand their wish to live a more independent life as a family while remaining a valued part of my family.

“Harry and Meghan have made clear that they do not want to be reliant on public funds in their new lives. It has therefore been agreed that there will be a period of transition in which the Sussexes will spend time in Canada and the U.K. These are complex matters for my family to resolve, and there is some more work to be done, but I have asked for final decisions to be reached in the coming days.”