British royal family told to cut expenses

The Whitehall officials said they expect the royal family to share the burden of budget cuts in the toughest review for a generation, due Oct 20, Daily Express reported. The Queen's annual Civil List payment, for performing her duties as head of state, has already been frozen at 7.9 million pounds (about $12 million), while a wider review of royal funding is conducted.

But the royal family's two other main sources of state funding, 22 million pounds for ­palace maintenance and travel, have been earmarked for cuts over the next three years. The cuts, due to come into force in April next year, may mean the Queen and other royals have to undertake fewer official duties in the run-up to her Diamond ­Jubilee year in 2012.

An official at the Department for Culture, which pays 15 million pounds a year for palaces, said: "All our bodies that we pay grants to have been told to expect reductions in the region of 25 percent and the royal household is certainly not exempt from that."

Officials at the Department for Transport, which granted the royal family 7.3 million pounds last year for ­official travel, although only five million pounds of that was spent and the rest returned, were equally adamant the royal family would be hit by cuts. However, both departments will not determine the exact size of the budget reductions facing the royals until they are told the lump sums they are receiving from the Treasury.

Buckingham Palace puts the annual cost of the ­monarchy to the taxpayer at 38.2 million pounds but that figure does not include security and other costs which put the bill closer to 180 million pounds a year.  Palace officials have been dipping into a reserve fund of 15.2 million pounds to bolster the Civil List but at the current rate of expenditure, that will be gone by 2012.

Prime Minister David Cameron and his Chancellor George Osborne are both said to be more critical of royal spending in private than many other ministers.  In October last year while still in opposition, Osborne indicated he expected the royal household to keep costs under control.

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