Campaigners have called for radical reform and a public inquiry into all royal finances after revelations that Andrew Mountbatten-Windsor received an undisclosed private income from subletting three cottages on his Royal Lodge estate while paying a “peppercorn rent”.

A report from the public spending watchdog, the National Audit Office (NAO), found the rental income went to the former Duke of York, but said: “We do not know what rent was charged.”

It was published on Friday as part of a public accounts committee inquiry set up after a public outcry over revelations that the former prince was paying a peppercorn rent (a small token payment) on the Royal Lodge estate in Windsor before he was evicted to Marsh Farm in Norfolk by the king.

The anti-monarchy campaign group Republic and the former Liberal Democrat minister Norman Baker said they would be pressing the public accounts committee for a full investigation.

Republic called the subletting a “flagrant abuse of public property” and said that while serious concerns remained about the former duke’s use of publicly owned property, the whole family was “benefiting from a multimillion-pound public housing scheme”.

The report also revealed that Mountbatten-Windsor’s daughters, the princesses Beatrice and Eugenie, who do not perform royal duties, live in royal palaces with their rent paid privately by King Charles, and adjusted, or discounted, owing to tenants having to be security vetted.

Graham Smith, the chief executive of Republic, said: “The crown estate and royal palace property portfolio is state property. It should all be used for the benefit of the public, not the private enrichment of the royals.”

He added: “MPs need to seize this moment to push for radical reform, including removing all royals but the monarch from publicly owned accommodation.”

Baker called for an investigation into “all royal finances, not just Andrew’s”, adding: “I am happy to open this can of worms.”

Margaret Hodge, who previously led the public accounts committee, told BBC Radio 4’s Today programme she was “very concerned” that the NAO was not able to find out how much money the former prince had made from letting properties.

Two organisations, the crown estate and the royal household, provide properties to members of the royal family.

The crown estate, a £15 bn portfolio of land and property, is held by the monarch “in right of the crown” but is not their private property. It runs as an independent business with profits paid directly to the Treasury.

A proportion its profits, known as the sovereign grant, is handed to the royal family to support their official duties in exchange for the monarch’s surrender of the revenue from the crown estate and is to be reviewed this year. The crown estate is required to achieve the best price when letting or selling properties, including those let to members of the royal family.

Mountbatten-Windsor was entitled to rent out the cottages under his long lease for which he paid a £1m premium and £7.5m in renovations in 2003, and a peppercorn rent thereafter.

Subletting provisions are a feature of certain long-lease structures granted by the crown estate but are not automatic, and are explicitly documented in each lease agreement. Most of the crown estate’s residential properties are on long leases, the NAO said.

Sources suggested Mountbatten-Windsor’s subletting did not generate profit, and rent was set at a rate to cover only maintenance and running costs for staff living there. But no further details have been made public.

Baker said the former prince could have been getting £30,000 a year for each of the three cottages before surrendering the lease.

“And if that figure is wrong, they have to come forward and say what he got. So I challenge him to come forward and tell us what he got,” added Baker, the author of Royal Mint, National Debt: The Shocking Truth About the Royal’s Finances.

“But it’s not just Andrew. It’s the whole gamut. We have Edward leasing out his stable block. Then there is William and the duchy of Cornwall,” he said, referring to recent reports that the duchy, which provides the future king’s private income, is poised to make millions charging the Ministry of Justice for leasing the abandoned Dartmoor prison.

Dr Craig Prescott, a specialist in UK constitutional law at Royal Holloway, University of London, said from a property law perspective it was perfectly normal to get a lease on an estate and then sublet different parts of it. However, when it came to royalty, perception was key.

“The perception is of people living in massive palaces or properties, and the concern is that they’re getting a very good deal or, worse, making money from it,” Prescott said.

The fact it was a crown estate property led to “more scrutiny” because its profits go to the Treasury, he said, adding that Mountbatten-Windsor had paid £7.5m upfront at the start of his lease.

The royal household manages and maintains the land and buildings in the occupied royal palaces estate through the sovereign grant. The occupied palaces are not owned by the monarch, but held “in the right of the crown” in trust for the nation, and include official residences such as Buckingham Palace, Windsor Castle, St James’s Palace, Clarence House and Kensington Palace.

The royal household generates rental income to help support the monarch in official duties by charging for residential properties within the occupied royal palaces estate, which amounted to £3.6m in 2024-25. As of May 2026, the royal household had 255 properties available for use within the occupied palaces.

Before 2011, the Department for Culture, Media and Sport was accountable to parliament for their upkeep, and delegated responsibility to the royal household in return for an annual grant.

Under David Cameron, the Sovereign Grant Act removed the responsibility of the secretary of state so that in future the properties would be maintained by the monarch out of the grant.

Prescott said: “The problem is essentially of perception here. That all this is so complicated and difficult to explain and understand; what is public and what is private is really quite a complex question at times. The reality is hidden behind all this complexity and that doesn’t help for public understanding.”

A global study of government finance leaders has revealed shared priorities and challenges in an era of unpredictable geopolitics and rapid digital transformation.

The Future of the Finance Ministry study – published by Global Government Forum and sister title Global Government Finance – is based on interviews with 10 senior leaders from finance ministries around the world.

The interviews were led by John McCarthy, chief economist in Ireland’s Department of Finance, working with the editors of Global Government Forum and Global Government Finance. Microsoft is the knowledge partner for the report.

“In a world where ‘disorder is the new norm’, the traditional role of the finance ministry is undergoing a fundamental transformation,” McCarthy writes in the foreword.

Four key themes are identified in the report: the evolving role of the finance ministry in response to uncertainty; the shift to more flexible finance systems that support outcomes; digital transformation and the growth of artificial intelligence; and the battle for talent and trust.

This chapter extract (below) focuses on the battle for talent and trust.

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Recruiting talent fit for the future finance ministry

Governments are facing what has been described as a ‘war for talent’, driven by factors including tight public sector budgets, increased competition with the private sector, and shifts in working patterns since the pandemic.

Finance ministries are particularly exposed to these challenges as central departments and, at the same time, the type of skills they need is evolving.

In the face of their evolving role, finance leaders say the skills mix their departments need is changing. While financial and economic expertise remains desirable, interviewees consistently highlighted the need to combine these skills with digital literacy, data capability and an understanding of wider geopolitical and security risks.

One leader explained: “We are changing the profiles of our human resources [recruitment] right now. We are trying to incorporate [more] young people with data skills.”

However, building this capacity takes time, and many ministries are still working to clearly define their future skills needs and identify gaps.

“We really are going to have to build up that capacity… we spend probably too much time doing things we shouldn’t do, and not enough on [strategic work],” one interviewee said.

Among the countries that have done this strategic work, a need for “multi-skilled” staff has been identified – individuals that are able to move between technical analysis, policy advice, and cross-government coordination. As one put it: “I look for people with multiple skills.”

Some finance ministries have made progress on bolstering their skills mix, noting that five years ago there were “zero” data analysts in the department. Now there are “a lot more of them in our workforce”, one interviewee said.

However, finding the right balance can be a challenge.

“We’re getting some really good technical skills coming in, but a lot of our people have no finance skills, and so we’re having to train them,” one leader said.

Looking ahead, another interviewee noted: “It depends on how artificial intelligence develops: there might also be obstacles skills-wise.”

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Recruiting and retaining finance talent

As they focus on addressing their skills gaps, many finance ministries are finding it increasingly tough to recruit – and retain – the multi-skilled personnel they identify as necessary.

Many interviewees say higher salaries in the private sector are the primary battleground for skills.

“Our salaries are a bit lower than in the private sector,” one commented. “We compete with banks and investors, and yes, attracting young people here is very, very difficult,” said another, while a third added that “the salaries which we offer here will never be able to compete with what’s offered in the private sector”.

In some cases, salaries can be as much as 50 per cent higher in the private sector.

Some finance ministries have responded to this by implementing new pay scales to be able to compete for talent in senior digital and financial roles. However, not all governments are in the position to do so.

There are other contributing factors to retention pressures that ministries – and indeed governments as a whole – face. One leader said they have particularly high levels of turnover at the analyst level – a pressure exacerbated in some cases by large numbers of younger skilled workers moving abroad.

Added to this is the competition for talent within government itself. While some leaders report a positive trend that public service is being viewed as a “good thing” by the younger generation, this means that there is competition across the whole of government for tech- savvy and multi-skilled personnel.

As one leader highlighted, when finance ministries employ “smart graduates of quite diverse backgrounds”, these individuals typically move on rapidly. It is a well-worn tradition in civil services that once these staff members have spent a couple of years at the Treasury, they become “very, very attractive to other civil service employers”, which contributes to significant turnover.

To counter this, many finance ministries seek to leverage their unique position at the centre of government. One leader highlighted that the principal attraction of a finance ministry role is the opportunity to work at “the heart of everything that government does”.

Staff in the finance ministry get a level of “exposure to a broad range of global and national issues” that they simply “might not get elsewhere in other government departments”.

It was also highlighted that finance ministries have a wider systemic responsibility to ensure financial leadership across government.

Some explicitly highlighted concerns about the quality of financial leadership in line agencies, calling it “extremely mixed and sometimes incredibly weak”.

Managing their own skills while also contributing to systemic leadership is therefore a difficult balancing act.

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The issue of trust

The uncertainty and low growth discussed in this report can be seen as having contributed to the rise of populism in many countries, leading to a corresponding decrease in public trust in governments and civil services.

Some – though not all – finance leaders in this report flag public trust as an increasing challenge, which can also impact the ability to recruit and retain public servants.

As one noted, they face an environment of “profound mistrust of politicians and experts”, while another highlighted that political populism has meant that “it’s very popular to say that government officials… are stupid, that they are lazy”.

One even reported that civil servants in finance have faced physical threats following the implementation of unpopular policies.

Another leader added that public servants are “petrified of having their name in the paper” and that there “certainly seems to be a distrust of public officers”.

Finance leaders cannot address this alone – it will require a cross-government effort, and some finance ministries highlighted that they are developing outreach programmes to the public to explain the role of finance ministries.

“We always talk to experts, but we are trying to do a bit more pedagogy – talking to high schoolers about what we do, about public finances, about how the economy works.

“I think there’s a question of: how do finance ministries fit in a world [where] there’s a lot of distrust of experts [and] the level of financial and economic literacy is very low? So, we are thinking more about how we engage with the general public.”

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The future of the finance ministry: providing engaging work now and in the future

Finance ministries need to modernise their skills mix and working models to attract, retain, and support the people required to deliver effectively in an increasingly complex environment.

Despite the challenges, interviewees consistently emphasised that finance ministries remain central to the functioning of government, and that this centrality can be a powerful tool for attracting and retaining talent.

One leader described finance ministries as “highly respected organisations” and a “desirable place of employment”.

As technology frees up time, leaders see growing opportunities for staff to focus on higher-value analysis, long-term stewardship, and strategic advice.

Another leader highlighted that embracing technology such as AI can reinforce this appeal, by demonstrating that they are not “reliant on old ways of doing business”.

This leader sees technology as “fast tracking” the “hard yards” of data entry to allow staff more time for “alternative perspectives” and strategic thinking.

Interviewees also noted that work in finance ministries is becoming more engaging as they expand their scope to include complex, “non-traditional” policy areas.

This shift requires “reinventing the way we do things” such as offering staff more varied career paths and opportunities for growth, one said.

Even the finance ministry leader who was among the most concerned about the competition for talent acknowledged that the work of the ministry is “very interesting” and that they are implementing new pay scales to better “reward good performance”.

Writing in the afterword, Valentina Ion, public finance and social services global lead at Microsoft, said: ‘Innovation as a talent magnet: The skills challenge in the public sector is acute as complexity increases. This is not just about recruitment, but also about retention.

‘Offering modern, innovative digital tools is now a primary benefit for the current workforce; if a ministry relies on legacy systems, it will struggle to attract the data scientists and multiskilled professionals required to navigate the future.’

Interviewees for the study were: Lai Chung Han, permanent secretary, Ministry of Finance, Singapore; Carlos Guberman, secretary of the Treasury, Argentina; John Hogan, secretary general, Department of Finance, Ireland; Andrew Lai Chi-Wah, permanent secretary for financial services and the Treasury, Hong Kong; Struan Little, chief strategist, Treasury, New Zealand; Chidozie Ofoego, financial secretary, Government of Bermuda; Dorothée Rouzet, chief economist in France’s Treasury; Merike Saks, secretary general, Ministry of Finance, Estonia; Bas van den Dungen, secretary general, Ministry of Finance, The Netherlands; and Matt Yannopoulos, secretary, Department of Finance, Australia.

Within the global manufacturing industry, maintaining a competitive edge requires a delicate balance between driving internal efficiency and fostering strong external relationships. For Applied Materials, a leader in materials engineering solutions for the semiconductor industry, this challenge became the foundation for a strategic finance transformation program, with an SAP Taulia solution emerging as a key enabler.

The journey began in early 2019 with the launch of Agile Finance, an end-to-end transformation initiative designed to support the company’s aggressive growth trajectory, which included a goal to double in size. The initiative was built around three strategic pillars: enhancing the efficiency and effectiveness of the finance organization, promoting career fulfillment, and establishing a robust digital operating model. The impact was significant, with the finance function achieving approximately 35% productivity gains in its labor force.

The third pillar—the move to a digital operating model—is where the partnership with SAP Taulia began.

“The SAP Taulia Dynamic Discounting solution was introduced not merely as a cost-cutting measure, but as a strategic tool to transform and digitize the interaction with Applied’s extensive, global supplier base,” Junaid Ahmed, corporate VP, Finance at Applied Materials, says. “We understood that to reap the benefits of digitization, we had to ensure the suppliers were on board. It needed to be a win-win outcome.”

Unprecedented flexibility for suppliers

The program empowers suppliers—thousands of them worldwide—to self-select which approved invoices they wish to discount for early payment. This is not a continuous, all-or-nothing commitment but rather a decision made on an invoice-by-invoice basis. This flexibility allows suppliers to manage their working capital needs with greater precision, taking advantage of early payment during their own critical periods, such as quarter-end or year-end, to help meet their own financial targets.

The system also drastically improves transactional efficiency. Suppliers no longer have to call Applied to track invoice status, approval, or payment date. All this information is available 24/7 in the SAP Taulia solution, reducing resource allocation on both sides and ensuring both reap the benefits of moving to an integrated, digital system.

Strategic benefits for Applied Materials

For Applied, the program is a testament to its focus on balancing efficiency with strong supplier relationships. The philosophy is a “win-win” built on a crucial spread: Applied Materials, as a Fortune 500 company with strong cash flow, has a significantly lower cost of capital than many of its suppliers. By funding the discounts, Applied captures a return—the discount income—while offering its suppliers funding at a rate close to their cost of capital, but with greater convenience.

This relationship-focused approach is critical. Applied’s supplier account managers actively support the program because they recognize its mutual benefit, not viewing it as a finance mandate to push costs onto the supply base.

Furthermore, the “dynamic” nature of the discount rates is a powerful risk mitigation tool. Unlike fixed contractual discounts, the rates can be adjusted in response to global economic changes, such as shifts in interest rates. When interest rates rose after the pandemic, Applied was able to adjust the discount rates accordingly with minimal pushback, as the core proposition remains the valuable spread between the parties’ cost of capital.

The SAP Taulia Dynamic Discounting solution has been rolled out globally, giving all suppliers the opportunity to use it. This has been critical over the last 12 months as many businesses around the globe have been subject to new and often unexpected tariff costs impacting their margin and their liquidity.

“The flexibility of the solution means suppliers can access funds when they need them, which helps them navigate some of the economic uncertainty that many businesses are facing,” Dirk Holoubek, managing director, Finance Shared Services, explains. “2025 saw a 23% increase in usage of the discounts, reflecting the pressures that suppliers are feeling right now on their cash flow.” 

The solution’s capability to drive sophisticated analytics is also a major strategic asset. It helps provide insights into the different costs of capital between Applied and its supplier base. This data allows for targeted outreach and communication, ensuring that the offer of capital support is proactively extended to the suppliers that need it most.

The strategic value of the solution is further cemented by its ownership. The acquisition of Taulia by SAP brings several advantages.

“Trust is really important to both us and our suppliers,” Ahmed says. “For our suppliers to adopt a new solution, they need to know its technology they can rely on in the long term. Being part of SAP creates that assurance in the long-term future of the program.”

Looking forward, Applied Materials is already focused on the next stage of the transformation project: Agile Finance 3.0, which is focused on enabling the organization to become AI-first. The company is deploying a global, organization-wide AI assistant to drive personal productivity, but the strategic application of AI in the supplier management space is even more profound.

AI is expected to transform decision-making enablement by analyzing critical information and communicating effective options. In the future, AI will be able to proactively assess the specific needs and attributes of the supplier base, enabling Applied to address issues more quickly and resolve them earlier. The benefits are already tangible in e-invoicing: AI has made the solution more flexible and “human-like,” capable of reading minor changes in invoice format that would have previously caused electronic errors. This reduced rigidity and increased flexibility are directly contributing to the overall efficiency of the digital operating model.

By leveraging the SAP Taulia Dynamic Discounting solution, Applied Materials has not only digitized a process but also strategically transformed its financial operations, creating a system that is agile, resilient, and focused on maintaining mutually beneficial relationships with its global supplier ecosystem.

Cedric Bru is CEO of SAP Taulia.