Subtle austerity

The Nobel Awards, probably one of the highest accolades accorded to human achievements is also feeling the pinch of recession. This time around, some amount of austerity was brought in to cut costs on the lavish banquet and ceremony hosted in Sweden.

The biggest cut was in the prize money - down from around $1.5 million in recent years to $1.2 million. This was the first reduction in the face value of the prize since 1949. But the rest of the austerity measures were subtle, not something jarring enough for all to notice. Small cost cuts like fewer limos and less costly menu items and flowers helped cut costs. There were 1200 guests and 40 chefs from around the world. Food was served in one of the biggest dinner sets of the world - 7,000 pieces of porcelain using 10,000 items of silverware and drink from 5,400 glasses.

The Noble foundation has managed well the roughly $450 million (280.6 million pounds) capital that forms the base for the awards, donated in the will of dynamite inventor Alfred Nobel. Earlier in June, the foundation had said in a statement that the costs of the prizes and related operating expenses had exceeded returns from interest and investments on the capital over the past decade, making it necessary to lower the prize money. The Foundation’s invested capital was valued at $419 at end of 2011, down 8% from the previous year. The endowment is invested in about 50% equities, 20% fixed-income investments and 30% alternative assets.