NAO audit reveals gaps in oversight of royal property income and Crown Estate subsidies
New findings from the National Audit Office highlight discrepancies in how non-working royals are subsidised, prompting calls for stricter accountability over taxpayer funds.
Margaret Hodge, the former chair of the Commons Public Accounts Committee, has expressed strong criticism of the National Audit Office (NAO) following the release of a report detailing the property arrangements of senior members of the royal family. Hodge described it as “shocking” that the public spending watchdog was unable to establish the specific income Prince Andrew Mountbatten-Windsor generated from subletting properties on his Windsor Royal Lodge estate.
The NAO report, published on Friday, revealed that Mountbatten-Windsor paid a “peppercorn rent” to the Crown Estate for Royal Lodge while retaining private earnings from the subletting of three cottages on the grounds. Hodge, who led the committee from 2010 to 2015, told BBC Radio 4’s Today programme that the failure to quantify these earnings represented a significant gap in accountability, particularly given the public scrutiny surrounding the use of taxpayer money.
Beyond the specific case of Mountbatten-Windsor, Hodge raised broader concerns regarding the subsidisation of non-working royals, including Princesses Beatrice and Eugenie, as well as Prince Michael of Kent and his wife. The report indicates that King Charles pays an “adjusted” rent, which is below open market value, from his private Duchy of Lancaster income to subsidise the residences of the princesses. Hodge questioned the appropriateness of such arrangements, noting that the Crown Estate consists of taxpayer funds and must ensure those interests are protected.
The audit also outlined the financial terms for the Prince and Princess of Wales, who signed a 20-year lease on Forest Lodge in July of the previous year. The couple pays an annual rent of £307,200, subject to review every five years, with no upfront premium required. Prior to their move-in last year, the Crown Estate completed £400,000 in repairs to the Grade II-listed Georgian property.
In response to the findings, a Crown Estate spokesperson stated that leases with royal family members are agreed upon in line with independent, professional advice and open market valuations. A Buckingham Palace spokesperson welcomed the report, describing it as consistent with the royal household’s commitment to transparency and noting that property arrangements vary based on location, tenants, and purpose. The NAO’s findings will now inform the Commons Public Accounts Committee’s upcoming inquiry into royal properties.