The Prince of Wales's private income increased by more than 4% last year but his funding from the taxpayer was almost halved, Clarence House accounts showed today.
Sir Michael Peat, Charles's principal private secretary, said the reason for the dramatic fall in taxpayer funding for the Prince was due to lower spending on overseas travel.
He said: "Most of that money is spent on overseas travel that the Prince and the Duchess of Cornwall undertake at the request of the Government, so it depends where the Government wants them to go.
"Last year the main long-haul trip they did was to Canada, which was paid for by the Canadians, so it didn't fall as a cost to British public funds."
The figures showed that the heir to the throne's official expenditure fell from £12,513,000 to £10,723,000 in the last year.
The Prince paid almost 13% more tax in the last year, with his bill rising from £3,093,000 to £3,484,000.
Meanwhile, his non-official expenditure fell by nearly 1%, from £1,710,000 to £1,694,000.
The accounts also revealed that Charles spent less than half the sum on official entertaining and receptions that he spent the previous year, cutting this bill from £527,000 to just £252,000.
This saving was attributed to cost efficiencies and the type of entertainment put on. The number of guests entertained remained constant.
Asked whether the global economic downturn had affected the way the Prince's household had been run during the last year, Sir Michael said: "Yes, absolutely. We are living in the real world."
He emphasised the Prince's prudent financial management - in contrast with that of the banks and others who made huge profits during the economic boom years.
"The Prince has tried to run his household and the Duchy of Cornwall in a constant, steady way," he said.
"In the heady days when banks and property companies were making vast returns, we didn't make vast returns.
"His approach has always been one of steady progress rather than dashing to the heights and then plunging to the depths...
"During the recession we're able to continue employing people rather than putting them on the dole, and to pay more tax rather than less tax."
The Prince employs the equivalent of 124 full-time staff, who perform roles ranging from private secretaries and financial and charities administrators to chefs, kitchen porters and gardeners.Reuse content