Mixed reception as royal couple name their day

Extra bank holiday means two consecutive four-day weekends, but businesses take hit

Royal watchers, romantics and well-wishers finally have a date: the wedding of Prince William and Kate Middleton will take place at Westminster Abbey on 29 April 2011, St James's Palace has announced.

Two thousand guests will witness the couple exchanging vows, while tens of millions will watch the event live on television. The global audience is tipped to top the billion who saw Prince Charles marry Lady Diana in 1981, making the event one of the biggest in TV history.

People in most of Britain will get a day off. Within minutes of the date being announced, the Cabinet made the day a bank holiday in England, Wales and Northern Ireland, giving those uninterested in the spectacle a reason to be thankful – and some small firms a staffing headache, according to one business group.

The wedding takes place on a Friday and the following Monday is the May Bank Holiday so many people will be able to enjoy a four-day weekend. And with the preceding Monday being Easter Monday the working week before the wedding will be reduced to just three days.

After news of their engagement last week, speculation had been mounting about the wedding date and location. St James's Palace said the couple chose Westminster Abbey for its "staggering beauty", 1,000-year royal history and intimacy, despite its size.

The royal family – as well as the Middletons – will pay for the wedding, including the costs of the service, music, flowers, decorations, reception and honeymoon. The public will pay for policing and security, which could reach £5m.

Prince William's private secretary Jamie Lowther-Pinkerton, said the couple were "completely over the moon". "I've never seen two happier people," he said. "They're now getting stuck into organising their wedding. They're giving us and the Household office very firm direction indeed."In a nod towards global economic turmoil, he added: "All parties involved want to ensure that a balance is struck between an enjoyable day and the current economic situation."

Tourists are expected to flood into London in April, providing extra business for airlines, taxis and hotels. Verdict Research predicts that the total generated could be £620m, with merchandise sales of £26m and £360m for grocery retailers, as shoppers load up on champagne, wine and food.

But the wedding could result in a net loss to UK plc, experts said yesterday, given the CBI has calculated each bank holiday costs £6bn. But the employer's organisation put aside the concerns, saying: "The royal wedding is a day for national celebration, and under these unique circumstances a one-off bank holiday is appropriate." The Federation of Small Businesses complained the event would be awkward for small firms, particularly when workers asked for the week off.

Graham Smith, spokesman for Republic, which campaigns for an elected head of state, said: "The public holiday blows a hole in the idea that the wedding will be an economic boost."

29 April: Winners & Losers

Economy Estimates of revenue generated range from the Centre for Retail Research's £515m to Verdict Research's £620m. But since each bank holiday costs up to £6bn, the event is likely to be a net loss to the economy.

Tourism Foreign royal watchers have been booking up airlines and hotels. Travel agent Thomas Cook forecasts a rise in traffic the other way, as Britons make use of the extra days' holiday to jet off to Turkey, Egypt or the Canaries.

Weddings After years of decline, religious groups hope the royal entwining will revive another ancient institution: marriage. The Church of England said: "The royal wedding will remind people again of the main ingredients of a wonderful wedding – the venue, vows and vicar – which everyone can have."

The feelgood factor The wedding will lift the spirits of "people who are interested in what other people are doing," according to clinical psychologist Dr Helen Nightingale. People who are cynical about relationships are unlikely to share in the happiness, she added.

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