Queen Elizabeth’s Household Finances No Reflection On Her Wealth

    January 29, 2014
    Tina Volpe
    Comments are off for this post.

With the headlines blaring, “Britain’s Queen Elizabeth II is in financial trouble,” a clarification might be in order.

The queen herself is not running out of money.

The report that such stories are based on comes from the House of Commons Committee of Public Accounts, which says the royal “household” had just 1 million pounds (about $1.7 million) in its reserve fund as of March 31 last year.

Committee chairwoman Margaret Hodge said lawmakers felt the queen had “not been served well” by her household accountants or by the Treasury, which is supposed to scrutinize royal spending.

“The household needs to get better at planning and managing its budgets for the longer term –- and the Treasury should be more actively involved in reviewing what the household is doing,” she said.

The household spent 44.9 million pounds in 2012-13. That’s $74.4 million at the current exchange rate. And it paid its bills thanks mostly to a taxpayer-funded grant of 31 million pounds from the British government and the 11.6 million pounds in income that the royals generated from visitors to palaces and other revenue sources.

Calculating the numbers shows that 31+11.6 = 42.6. That means the royals were short the 2.3 million pounds needed to cover their household spending. “The household drew down £2.3 million from its £3.3 million Reserve Fund, leaving a balance of only £1.0 million at 31 March 2013,” says the House of Commons report.

This is all a problem, the report says, because the queen should have more socked away “to cover unforeseen demands.” What’s more, some such demands may not be so unforeseen.

The reports also criticized the royals’ ‘complacency’ in allowing some 39 percent of royal buildings and land to slip into a state of disrepair. It said the 60-year-old heating system in Buckingham Palace alone will cost between £500,000 and £1 million to replace.

But what the headlines are discussing is the royal household account, which probably could use a bit of tightening. However, the queen is not broke, nor will she ever be, “her personal net worth [is] around $500 million.”

Her wealth, “comes from property holdings including Balmoral Castle in the Scottish Highlands, stud farms, a fruit farm and marine land throughout the U.K.; extensive art and fine jewelry; and one of the world’s largest stamp collections built by her grandfather.”

“Not included above are those assets belonging to the Crown Estate, which she gets to enjoy as queen, such as $10 billion worth of real estate, Buckingham Palace (estimated to be worth another $5 billion), the Royal Art collection, and unmarked swans on stretches of the Thames.”

We expect some may wish to discuss in the comments thread whether a family with that much money needs as much help as it is getting from Britain’s taxpayers.

The Atlantic notes that critics of the monarchy claim it really costs about $307 million a year to keep the royal family housed, fed, and protected. Other officials, though, claim that royal-related tourism generates about $767 million in annual revenue for Britain.

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  • Reality

    If anyone thinks the British royalty is broke or needs money, they have to have no knowledge of world history. There is more money and more hidden money in that family than you can imagine. It is like the FED. No one really knows who owns the FED or what they have because they can't be audited. So literally the largest private bank in the world cannot be audited.

    They royals are pretty much the same. They have stuff that is not even written down. Are people really this naive in this world.

    And no. Taxpayers should not pay them a dime. Period. Taxpayers are already getting screwed by the rich as it is. Look at Buffet. Warren Buffet last year made 37 million dollars a day. Yet, he pays less than 12 percent in taxes. You tell me how that happens. My parents on a social security pay more than that.

  • Sam

    It is important to note that this article states that the Royal household remains solvent. I've personally got no idea about the funding or financing of the household, but would assume that the costs of maintaining Her Majesty in Her residences would be mitigated or entirely voided by the role She plays as the Commonwealth Head of State.

    Perhaps this role is fading into the background as more important issues like what the Duchess Kate is wearing flood the tabloids, but Her role is still constitutionally important and valid for Britain and the Commonwealth. Similarly, the role of the House of Windsor in assisting many charitable and aid groups around the world is held in high regard.

    I suggest Reality maintains an open mind about Mr Buffet also, who has suggested that he has little good to say for the loopholes in tax systems which allow the wealthy to avoid moral responsibility in their tax avoidance.

    My personal and generally uninformed opinion is that if the income generated by the Royal estates for the public coffers is substantial enough to maintain the Household and the Residencies, the treasury should continue to pay for the expense of maintaining the Head of State. If not, then perhaps in our egalitarian age, substantial cutbacks need to be considered.

  • Jason

    They don't mention that the money in the "Reserve Fund" is not extra money the government set aside to be used, but that money as a fund that the royal household saved up during a 20 year pay freeze (it was 10, but extended to 20 when it was seen a success), but when they extended that freeze a couple more years and then added to the list of things to be done, that is when the fund started to shrink. The Royal family receives the funds from the Crown Estate as a means for the monarch to be held in check and responsible to the country, otherwise if they just sat at the top with no accounting to anyone they could do as they please, never leave or get out and do duty, but that money means they have an obligation to up keep. But that money is not HER money, that is the money spent doing the jobs the government tells her to do, state visits, travelling, events they want to put on- plus think about it, what other government department of that size or even smaller, functions at that bargain price? 400+ employees, and you get a family to get out there and work. The US President ALONE cost 1 BILLION in travel and pay, that doesn't include his staff!

    • Assist to Parliament Chair

      you are so wrong and very much miscalculated in any financing means for maintaining and managing for President of USA, nor Queen Elizabeth, No government tell her nor her family on what to do since they are two separate monarch system.

      Do your homework, before you looked like a fool.