Refurbishing Prince Harry and his wife Meghan's new home in Windsor cost $3.05 million, thus sparking a wave of criticism from anti-monarchy campaigners.
Following a six-month renovation, the couple moved to the new residence before the birth of their son in May.
"The property had not been the subject of work for some years and had already been earmarked for renovation. The building was returned to a single residence and outdated infrastructure was replaced to guarantee the long-term future of the property," Michael Stevens, who runs the monarchy's accounts, explained.
"All fixtures and fittings were paid for by their royal highnesses," Stevens defended.
"The 10-year reservicing programme presents a unique opportunity for innovation and investment in one of the world's most prestigious and iconic historic buildings, thereby preserving it for future generations. The work is sequenced so as to enable the palace to remain occupied and fully operational and the Queen's programme to continue to be delivered without interruption,” he noted.
The British monarchy published its financial accounts for last year, showing a $20 million increase in expenses.
"This year's increases are outrageous at a time of widespread spending cuts. If even one school or hospital is facing cuts, we cannot justify spending a penny on the royals," Republic campaign group member, Graham Smith, told The Sun newspaper.