Andrew sublet three cottages while paying ‘peppercorn rent’ to crown estate | Andrew Mountbatten-Windsor

A report into royal property arrangements has found that Andrew Mountbatten-Windsor earned private income by renting three cottages on the Windsor Royal Lodge estate and paying “pepper rent” to the royal estate.

The National Audit Office (NAO) review also shows that King Charles paid an “adjusted” rent below open market value from private Duchy of Lancaster income for his disgraced brother’s non-working royal daughters, princesses Beatrice and Eugenie, to live in the royal palaces.

Meanwhile, the Prince and Princess of Wales’s Forest Lodge home in Windsor has undergone £400,000 worth of repairs. crown estate before the couple moved in with their three young children last year.

The NAO said William and Catherine signed a 20-year lease on the Grade II-listed Georgian house, which has gardens, paddock, stable and 7.4 hectares, in July and paid rent of £307,200, which was reviewed every five years, according to the NAO. They paid no upfront premium and are responsible for interior renovations and renovations.

Details of the properties were revealed in the report published on Friday, which will form the basis of the Commons public accounts committee’s investigation into the royal estates following a public outcry in October when it emerged that Mountbatten-Windsor was paying peppercorn rent at Royal Lodge, the Windsor estate from which she was evicted by Charles.

The NAO found that rent and rental arrangements for royals differ depending on why the accommodation is required and whether the property is managed by a crown estate (a self-financing public company that manages assets on behalf of the crown) or by the royal family.

For those ruled by the royal family, the “adjusted rent” was often 60 percent of open market value because the properties were located within a secure cordoned area that required tenants to undergo security screening.

The rent for Beatrice’s St James’s Palace flat is 68% of market value, while the rent for Eugenie’s Kensington Palace country house is 64%. Eugenie’s rent was 50% of 2018 open market value from 2020 to 2021 and ranged from 55% to 63% in 2022, while Beatrice’s rent was 60% of 2020 market value from 2020 to 2021 and ranged from 62% to 68% from 2022 to 2025. NAO said.

Charles also pays the rent on Prince and Princess Michael’s Kensington Palace apartment in Kent, but there is no record of the valuation of this lease before 2026.

Mountbatten-Windsor, who is now evacuated to Marsh Farm on the Sandringham Estate in Norfolk, had a lease allowing him to rent, but it was not known how much he received from it.

The report said it paid a £1 million premium and £7.5 million for the renewal of the Royal Lodge under a 75-year lease in 2003, and could be entitled to compensation of between £301,967.66 and £488,342.21 if it was handed over early. However, the royal estate had previously stated that it would not be owed any compensation considering the devastation.

Sources claimed that the subletting of Mountbatten-Windsor was not profitable and that the rent was set at a rate that would only cover the maintenance and operating costs of the staff living there. However, no figures such as repair and house expenses and rental income or copies of the rental agreements were made public.

Public money provided through state donations is used to pay for the maintenance and operating costs of occupied royal palaces. However, sources suggested that the adjusted rents paid by the king for Beatrice and Eugenie’s palatial residences covered the expenses covered by the state grant on these properties, and therefore the donation had no additional cost.

Norman Baker, a former Liberal Democrat minister, said the arrangements for Mountbatten-Windsor were “add insult to injury”. Not only could Andrew be able to get a peppercorn rent for a huge property, but he could potentially make millions renting out the properties. The money should have gone to the royal estate, but it didn’t. [his] pockets”.

The Duke and Duchess of Edinburgh paid a £5 million premium for Bagshot Park, their home on the Windsor estate. A new lease granted in August 2007 replaced the previous lease, with Prince Edward paying £1.38 million against the original 1998 lease. The couple pays peppercorn rent. The report also stated that they earned income by renting the stable block until 2020.

Seven members of the royal family rent five properties from the royal estate. The report said lease terms varied and the crown estate sought independent professional advice on financial terms, with the then open market value agreed.

The royal family provides seven residences in occupied royal palaces for 11 working royals, including Charles and Camilla, at no cost to them in exchange for their official duties.

The report states: “Overall, we found that: [the crown estate] We applied standard practices in line with the rentals and processes we examined. Where we find differences they relate to specific terms in leases for the same type of lease. “Each lease was agreed at different times over a 50-year period, so some differences in practices and outcomes are to be expected.”

A spokesman for the royal estate said: “The Crown estate welcomes the National Audit Office’s review, which confirmed that leases with members of the royal family were agreed on the basis of independent, professional advice and open market valuations. We look forward to discussing the report in more detail with the public accounts committee in due course.”

A Buckingham Palace spokesman said: “We are grateful to the National Audit Office for this report, which is consistent with the royal family’s commitment to transparency. We hope that the findings will help to correct, clarify or contextualise a number of points regarding royal properties. As the report notes, regulations for properties managed by the royal family vary based on a range of factors, depending on their location, tenants and purpose, to ensure that residences are appropriately occupied.”