IN 18th-century Edinburgh there was a debtors' prison.

It was situated on Calton Hill, on the site of which today stands St Andrew's House, whose contemporary inmates are civil servants.

It is a prime location, overlooking the Old Town and its teetering tenements, Arthur's Seat and the Palace of Holyrood which, as the crow flies, is little more than a mile away.

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On Sundays debtors were allowed out, probably because the only thing to do was listen to a divine drone on and insist you repent of your profligacy.

Perhaps some of them dropped in on the Canongate Kirk, where Zara Phillips, who lies 15th in line to the throne, married a common rugby player with a bashed nose. On occasion, they may even have bumped into a visiting royal.

I thought immediately of the Calton jail when I learned of the parlous state of the Queen's finances. Last year, it would appear, she spent more than she earned. I say "earned" but that is misleading; a more appropriate verb may be "received".

In 2013, she was awarded £31m through what's known as the Sovereign Grant. But it was not enough to cover her outgoings. When all the beans were counted, it emerged there was a shortfall of £2.3m which had to be met out of Her Majesty's own reserves.

This left just over £1m in the kitty which, according to the Commons committee charged with overseeing that the Queen does not end up in Queer Street, is "a historically low level of contingency".

Hence the cries from some of my more hysterical brethren that the owner of Buckingham Palace, several desirable pieds-a-terre, not to mention stables full of thoroughbreds and galleries bursting with Old Masters, is "down to her last million".

As one gets older, money and the lack thereof is of ongoing concern. With few opportunities to augment pensions and the return on savings pitiful, it is incumbent on us to manage our budgets as best we can.

In that respect, the Queen is no different from anyone else. In bygone times, a monarch had what might be called more wriggle room.

He or she could levy a tax, non-payment of which could result in dire consequences, such as the loss of a finger or toe. Alternatively, he or she could invade somewhere, looting and pillaging as he or she went. Alas, neither option is open to our Queen. So what can she do to climb out of the financial black hole into which she has embarrassingly tumbled?

First, she could tighten her stays. Without being privy to her books I cannot say how much this would help. But savings can always be made.

Does she, for example, need quite so many dogs? And before the animal liberation brigade tweaks my tail, I am not saying they should be culled.

What I would suggest, though, is that when one of them departs for the celestial Crufts it should not be replaced. Ultimately, I'd put a limit on her of two dogs, one for ceremonial occasions, the other for exercise purposes.

Transport, I gather, is also a considerable drain on the royal purse. With Britannia docked in Leith, the Queen has been less inclined to visit foreign parts. Soon, too, the royal train may no longer be fit for purpose, thus bringing an era of privilege to an ignominious end.

What then? Can one really imagine Her Majesty and her hangers-on in ScotRail's first-class shoe box as they travel north to Balmoral? Possibly not, but how otherwise are they to get around economically?

It may worth pointing out, therefore, that the Queen, who is 87, qualifies for a senior railcard, which for a small investment reduces all fares by one-third, and a free bus pass too.

The other alternative open to her is raise more revenue. Here, she could take her lead from Prince William and his spouse, both of whom have formed companies to protect their images.

This allows them to sell officially endorsed products, such as mugs, and sue the pants of anyone who offers tat in their name. The beauty of this is that you need only be yourself, which the Queen has always been. I mean no disrespect when I say she'd be perfect as the face of a premium dog food.