Elizabeth and Royal Financies

Question 1

what was the state of royal finances when Elizabeth came to power

Answer 1

She ruled at the time of inflationary pressure on the economy.

Question 2

what was the inflation a direct consequence of

Answer 2

The debasement of coinage under Henry VIII and during the mid tudor crisis and the excess money spent to finance war

Question 3

how much debt did Elizabeth inherit

Answer 3

£266,000, some sources state it was 200,000 others say 227,000. So 245,000 is an ideal middle ground.

Question 4

what does the lack of funds mean for the crown

Answer 4

It meant that in order to stay solvent or stand a chance at pursuing active foreign policy the crown had to increase its revenue and cut expenditure

Question 5

how was revenue raised?

Answer 5

By exploiting traditional sources of income rather than innovating as Mary Tudor had already begun the process of achieving financial stability

Question 6

what did exploiting traditional sources of raising revenue result in?

Answer 6

Royal income rose by 50% between 1558 and 1603, just enough to keep up pace with price inflation though not enough to afford a prolonged war with Spain after 1585

Question 7

examples of how revenue was raised

Answer 7

1. The Book of Rates introduced at the end of Mary’s reign increased the income from customs duties on exports
2. Generated taxes from the recovery of the cloth industry
3. She made herself the head of the Church through the Act of Supremacy 1559 and as a result she claimed income from religious sources, such as the first fruit tax on office holders in the church
4. Approached parliament to grant subsidy to finance FP
5. Sold off crown lands and got £800,000
6. Sold monopoly rights to merchants
7. Collected outstanding loans from nobility

Question 8

examples of attempts to control expenditure

Answer 8

1. Used unpaid officials like JP’s
2. Instead of giving away excess land as patronage she gave out monopolies
3. Salaries were low to keep up with the pace of inflation - she asked JP’s in every county to set up minimum wage rates
4. She strictly monitored the costs of her household and didn’t build any new palaces
5. She maintained naval expenses by remodelling old ships instead of buying new ones, which was a policy gotten from Mary’s modernisation of the Army
6. Took a cautious approach to Foreign Policy which helped conserve her financies

Question 9

was Elizabeth solvent at the end of her reign?

Answer 9

No. Money was barely enough to keep up with inflation and not enough for war with Spain.
She left the crown in debt of more than £400,000 by the time of her death
Though she inherited a mid-tudor crisis and a debt of £266,000 she still managed to stay afloat for a while.
She was left at the mercy of parliament due to the Crown’s lack of funds.