Is UK’s Queen Elizabeth II, one of the world’s richest women, really down to her last million in savings?

Tony Gosling tony at
Thu Jan 30 00:58:05 GMT 2014

Queen down and out? UK royal palaces ‘crumbling 
and leaky’ as her finances dwindle
Published time: January 28, 2014 16:04
Britain’s Queen Elizabeth II, long thought to be 
one of the world’s richest women, is apparently 
down to her last million in savings, with palaces 
leaking and falling to pieces as MPs say she has 
been failed by her advisers and the Treasury.
The Queen’s courtiers have been advised to take 
money saving tips from the UK treasury, as her 
finances dip to an historic low with just £1 
million left in reserve, the Telegraph reported.
A report by the Commons Public Accounts Committee 
found that her reserve fund had fallen from £35 
million in 2001 to £1 million today. While the 
Royal household had made efficiency savings of 
just 5 percent over the past five years, 
government departments have made savings of up to a third.
MPs on the committee said that the Treasury must 
help to protect royal palaces from further damage and deterioration.
“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,” said Margaret Hodge, the Labour chairperson of the committee.
Buckingham Palace and Windsor Castle are both in 
a terrible state of repair with staff required to 
catch rain in buckets to protect art and antiquities.
Meanwhile, in Buckingham Palace the 60-year-old 
boilers were running up bills of £774,000 a year 
and the wiring has not been replaced since 1949. 
More than a third of the royal estate has been 
found to be below “target condition.”
The committee compared Buckingham Palace, which 
has just 500,000 visitors a year, to the Tower of 
London, which has more than £2 million.
“If you look at the Tower of London and its 
visitor numbers it makes you think that there’s 
potential here. Have they done their darnedest to 
maximize value for money?” Hodge said.
The report also found that the royal household 
has not even attempted to cost up its huge 
backlog of repairs because it believed there was 
no point in doing so until it has new funding in place.
The Crown Estate gets 15 percent of its income 
from the Sovereign Grant, which replaced the old 
way of funding the Royal Family through the civil list in 2012.
While the Royal Household’s net expenditure was 
£33.3 million last year, £31 million of this came 
from the Sovereign Grant. To find the difference, 
it had to dip into its reserve fund.
A spokesman for Buckingham Palace insisted that 
the Sovereign Grant had made the Queen’s funding 
“more transparent and scrutinized” and was 
resulting in a “more efficient use of public funds.”
But the committee found that much more needs to 
be done if the Crown Estate and the Royal 
Household are to properly manage the Queen’s finances.
“We got the impression that they just haven’t 
tried to make greater savings. Here we are, we’re 
all in it together, but they are failing to eke 
out better value for the Queen. They are dipping 
into their reserves in a way that just isn’t sensible,” Hodge said.
The report found that the Treasury was not doing 
its job properly. It is responsible for 
overseeing the Royal Household finances but is 
not doing enough and should draw on its extensive 
experience and “offer advice on key packages.”
“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,” Hodge said.

Number crunching

A closer look at both the report and the figures 
in it reveals that the Queens finances may be 
healthier than the Committee found, and in areas 
where she has lost money it is not the fault of 
the Treasury but of her managers, the Guardian reports.
The report its self was compiled from a series of 
questions and answers with just two witness 
giving the answers, Sir Alan Reid, Keeper of the 
Privy Purse and Mike Stevens, Deputy Treasurer to the Queen.
When asked why they did not cut back their 
expenditure, Sir Alan Reid replies: “We really 
believed that it is not wise to cut back on the 
level of activity of the monarchy.”
The figure of 1 million pounds does not 
accurately reflect the value of assets held by 
the Royal Household, the Guardian says. Their 
total reserves stand at 14.2 million pounds, 11.8 
million pounds of which comes from property, 
plant and other equipment.The biggest chunk of 
royal spending goes on payroll, and although 
staff numbers remained unchanged over the past 
year cost have risen considerably.
Austin Mitchell, one of the members of the 
committee, asked: “It looks to me that you 
managed to survive and manage the finances by 
letting the buildings deteriorate, by freezing 
the staff costs and by digging into the reserves. 
Is that a fair summary of what has happened?”
To which Sir Alan replied, “I think that does 
summarize, to a degree, what happened last year.”

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