Princess Beatrice and Princess Eugenie have found themselves unwillingly in the spotlight again, following the release of a new report by the National Audit Office into the royal family's residential property arrangements.
The report uncovered the shocking detail that Andrew Mountbatten-Windsor, the King's disgraced brother, was subletting his properties at Royal Lodge and gaining an undisclosed private income. It's understood the rent Andrew received was to cover the maintenance and running costs of the sublets, and he did not make a profit; as the leaseholder, he was allowed to do that.
But the revelation has prompted fresh outcry over the benefits Andrew had, while only paying peppercorn rent on his 30-room Windsor mansion.
The King's rental agreement with Beatrice and Eugenie
What was also laid bare in the report, however, was that Andrew's daughters, Beatrice, 37, and Eugenie, 36 – two non-working members of the royal family who have their own careers, second homes in the Cotswolds and Portugal respectively, and are married to wealthy husbands – are being bankrolled by their uncle King Charles.
The King has been paying rent on Beatrice's St James's Palace apartment and Eugenie's Ivy Cottage, Kensington Palace home for years. It was an agreement that was put in place by the late Queen Elizabeth II, who was very fond of her granddaughters, and Charles has continued to honour it.
The money that Charles uses to pay for his nieces' rent comes from the Privy Purse, which is made up of his Duchy of Lancaster income and other private funds. No taxpayer money is involved.
The controversy, however, is that Beatrice and Eugenie's homes are maintained by public funding via the Sovereign Grant – in other words, taxpayer money.
Reduced, out-of-date rents
What's more, the rent that Charles has been paying has not been calculated as fair market rent, nor is it up to date. Up until this year, Eugenie's Ivy Cottage rent was based on a 2018 valuation (and was only 50 percent of the 2018 open market value from 2020 to 2021, increasing to 63 per cent in 2025, now standing at 64 per cent of the open market value).
© InstagranBeatrice's rent of her apartment in St James's Palace was based on an outdated 2020 valuation. For her rent, the King was paying 60 per cent of the 2020 market value, now increasing to 68 per cent for 2026.
© Getty ImagesThe argument for an adjusted, reduced rent stems from Royal Household properties requiring tenants with security clearance, and not just any regular tenant.
How did the report come about?
The National Audit Office's report was prompted by the scandal of ex-Prince Andrew's peppercorn rent deal on Royal Lodge, which came to light last year. The controversy opened a can of worms – should all royals be paying fair market rent? – and put the spotlight on Beatrice and Eugenie's cushy arrangements at royal palaces, despite them not being working royals.
A Buckingham Palace spokesperson has said: "We are grateful to the National Audit Office for this report, which is in line with The Royal Household's commitment to transparency. We hope that the findings will help correct, clarify or contextualise a number of points regarding royal properties.
"As the report notes, arrangements for properties managed by the Royal Household vary based on a number of factors to ensure residences are filled appropriately, depending on their location, tenants and purpose."
The report will form the basis of the Public Accounts Committee's upcoming inquiry into royal properties.
Do you think Princesses Beatrice and Eugenie should start paying rent on their palace homes? And fair market rent at that? Have your say in the poll below and leave a comment (click here to take part if you are on a non-HELLO! platform).
