London: Queen Elizabeth II has felt the pain of the drastic budget cuts in the United Kingdom and agreed to make spending cuts.
Chancellor George Osborne told the House of Commons that "the Queen has agreed to a 14 percent drop in royal household spending 2012-2013, while grants for official travel and palace repairs will be frozen in cash terms."
The way the Royals are funded will then be completely overhauled, with a single grant replacing the various strands of her state income, replacing the civil list arrangement that has stood for more than 250 years, he said.
But the Royal family will get a special payment of GBP 1 million to cover the costs of Diamond Jubilee celebrations in 2012 which, Osborne said, the whole country was looking forward to.
A spokeswoman of the Buckingham Palace said: "The household obviously has some challenging times ahead, like any area of government but we welcome the announcement of the sovereign support grant as a modern, transparent and simpler way of funding the head of state."