Queen Elizabeth's Financial Problems

The lawn was a perfect emerald green, the roses were in lush bloom and the palace - well, it is Buckingham Palace, and as I trooped through the entrance galleries last week, it looked polished and elegant. But these are not the best of times for the Windsors: Queen Elizabeth II is reportedly short on cash to redecorate the Palace's State Rooms, which haven't been spruced up since the Queen took the throne in 1952. Plus, there isn't even enough money (about $65 million) to carry out less glamorous projects, like asbestos removal, rewiring and roof repair. It seems that Her Majesty, like all the rest of us, is feeling the financial pinch--despite a net worth estimated at $650 million.

But you wouldn't know it from the Queen's first garden party of the summer season (three more will follow). My invitation came through a handful doled out to the Association of American Correspondents in London but most of the 8,000 attendees were loyal subjects who were clearly thrilled at the once-in-a-lifetime opportunity to see the Queen in person rather than on a stamp or a pound bill.

The doors opened more than an hour before the Queen and her husband, Prince Philip, were scheduled to appear and chat with the crowd--plenty of time for the partygoers to explore gardens that are usually closed to the public. But as the time for the royal appearance drew closer, a kind of invisible magnet drew everyone to the center lawn where we obediently formed two corridors to let the royal couple chat earnestly with pre-selected guests. It looked like hard work for the 82-year-old monarch and her 87-year-old husband and it probably was - although they both have had decades of practice. At each conversation stop, the Queen appeared genuinely interested in what her guests had to say. Then, she hit the royal tea tent where instead of a quick cuppa, there were more guests to chat up.

This is just a small portion of the activity that the royal family claims cost British taxpayers about $80 million in the fiscal year that ended in March 2008 --or, as the royal bookkeepers helpfully explained on the Queen's website, about $1.25 a person, "less than the price of two pints of milk or a download to an iPod." (The price of an iTunes download in the United Kingdom is $1.38.) Sir Alan Reid, whose official title is Keeper of the Privy Purse, assured the public that the Queen's financial advisers pay "continuous attention to obtaining value for money." And he argued that trying to cut royal corners now would mean much bigger expenses in years to come if maintenance is deferred even longer.

Nonetheless, spending commoners' cash on the royals continues to be controversial. When the most recent numbers were released late last month, an anti-monarchist group called Republic claimed that the real cost was nearly triple the official estimate. Supporters of the monarchy contend that the royals justify their tab because they bring in tourists. But Republic noted that only one royal residence, Windsor Castle, is among the United Kingdom's top 20 tourist attractions. And it's only 17th on the list, beaten handily by nearby Legoland (number 7).

The newest royal accounting did prove one thing: there's no such thing as travel on the cheap in this family. When the Queen flew to the U.S. to mark the 400th anniversary of the Jamestown settlement, the cost of the chartered aircraft alone was more than $760,000, according to the palace. Taxpayers also picked up the $560,000 tab for an official two-week visit to the Caribbean by Prince Charles and his wife, Camilla - including $420,000 for a 12-day yacht charter.

That may sound impossibly luxe to most of us, but the monarchy isn't what it used to be. Even with her illustrious ancestry, the Queen's coffers pale compared to more modern royalty, like Harry Potter creator J.K. Rowling, whose net worth, according to The Sunday Times of London, is estimated at about $1.1 billion. Rowling, of course, didn't earn that money from the tax rolls. And that's what continues to rankle the Queen's critics. Why should ordinary Brits, themselves struggling with rising household costs, have to foot the bill for the Queen?

In a press conference accompanying the release of the budget, Sir Alan claimed that the cost of maintaining the monarchy has not gone up as much as many other expenses. Overall, the total was 5.3 percent higher than the previous year although some expenses soared. The cost of food at Buckingham Palace, for example, was up 20 percent--to $1 million.

All of which made me feel more than a little guilty as I scarfed down the particularly delicious cucumber finger sandwiches and petit fours in the tea tent at the garden party. My mind wandered to thoughts of Nepal, where the parliament recently voted almost unanimously to get rid of its monarchy. It's unlikely that the current British monarch will face that fate. Even many of those who want to abolish her privileged position acknowledge that she has worked hard in the job (Charles will have a tough act to follow). And here's another tip for monarchs who want to keep their thrones: get Helen Mirren to play you in a sympathetic, Oscar-winning role. As I watched the real Queen chatting with her rapt subjects, I heard more than one partygoer comment that she seemed so much tinier than in the movie. True--but still somehow larger than life.

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