The Sun reports (see http://www.thesun.co.uk/sol/homepage/news/royals/3179040/O-glum-all-ye-faithful-Royal-party-axed.html#ixzz12HrWm1CT) that the Queen has cancelled the annual staff Christmas Party. They said that a Buckingham Palace spokesman said “Given the current economic climate it was thought that it was appropriate for the Household to show restraint.” The party usually costs about £50,000.
The Queen surely has this money. By not spending this money, the Queen keeps the money–probably in her bank account. By not spending £50k, service companies and people working for those service companies do not get the opportunity to provide those services in return for being paid. That’s probably a lot of of people who now have both reduced income and more free time on their hands. This decreases government tax revenue (income tax and VAT on the purchases) and perhaps contributes to more redundancy (layoffs)?
Explain to me again why the Queen not spending £50k is a good idea?