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Last Updated:  Friday, 14 March, 2003, 02:00 GMT
Storm over Charles aide
Michael Fawcett and Prince Charles at Sandringham
Michael Fawcett, Prince Charles's personal assistant, has resigned
Renewed criticism is being levelled at Prince Charles' household after it was revealed a trusted aide will carry on doing royal work despite resigning in the wake of a critical report.

Michael Fawcett will still work freelance for the palace, carrying out some event management and being given "some financial help".

This will enrage critics of the prince, and Friday's papers are all full of speculation regarding the settlement for Mr Fawcett.

The Daily Telegraph and other newspapers suggested the value of the settlement was as much as 1m.

Other reports of the settlement include that Mr Fawcett will be able to remain in his 400,000 "grace and favour" house and will get guaranteed work worth 100,000 a year.

The report, by the prince's private secretary Sir Michael Peat, said Mr Fawcett did bend the rules by accepting numerous gifts, such as a 2,500 watch and 3,000 club membership, without declaring them.

Click for more details on Charles's palace staff

But it cleared him of any financial impropriety, saying he could not be severely criticised because the rules were not enforced and he made no secret of such gifts.

The Prince of Wales, who is out of the country on a short tour of Bulgaria, said: "The review does not make comfortable reading in some parts, but I accept full responsibility and all the recommendations.

"I am determined that the administrative procedures in my household should be to the highest standards and I have asked Michael Peat to ensure that this is the case."

The report also strongly criticised the palace's handling of a male rape allegation, saying allegations by former royal valet George Smith in 1989 were handled too dismissively.

Claims dropped

Prince Charles is reported to have forced the valet out after the allegation, saying: "George must go".

And Fiona Shackleton, Charles's lawyer, is reported to have said: "I had instructions from the boss [Prince Charles] to make the whole business go away".

Mr Smith later dropped his claims.

All official gifts to royals be properly recorded
Only to be given away if they are worth less than 50, or perishable
Otherwise they must be used, displayed, made part of the Royal Collection, put on loan, given to charity or sold for charity

The inquiry was ordered following the collapse of the trial of Princess Diana's former butler, Paul Burrell.

The report found neither the Queen nor Prince Charles's households had displayed "improper conduct" over the trial.

But it said Prince William had known 18 months before the trial's collapse that Mr Burrell was safeguarding Diana's possessions.

That was because Mr Burrell had written to him after a police visit, saying: "Items which have been taken from me, many of which were given to me for safekeeping, should be returned to you."

The report was most critical of the prince's household concerning the sale of official gifts.

"I am not going to make any excuses - things have not been well handled in this office," Sir Michael told reporters.

Sir Michael Peat, report author
"The report is detailed, honest and open"

The BBC's Jennie Bond
"Few will accept that Michael Fawcett was not pushed out"

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