Prince Michael of Kent is a "squatter" living in Kensington Palace for a peppercorn rent, a Labour MP has claimed.

Ian Davidson was responding to the Prince's defence of his reported �69-a-week rent for a five-bedroom, four reception room home at Kensington Palace.

The Prince told The Sunday Telegraph: "People assume our lifestyle is paid for by someone else, but it's paid for by us. Except the house, clearly."

Mr Davidson, a member of the Labour-dominated Commons Public Accounts Committee, said the Kents are an embarrassment to the Royal family.

(No one) receives council tax benefit or housing tax benefit and owns a second home elsewhere

Ian Davidson MP

The Glasgow Pollock MP said the London property should be put to "better use".

The Prince told the newspaper that he and his family were "not quitters".

Mr Davidson said: "Prince Michael says he is not a quitter - but he certainly seems to be a squatter getting this valuable property for a peppercorn rent.

"It would appear the Prince and Princess are prepared to fight for their right to receive a �200,000-a-week housing benefit without means testing.

'Royal embarrassment'

"That would certainly seem to be somewhat of an embarrassment to, potentially, the Royal Family."

With a second home in Gloucestershire, the Labour MP suggested that the Kents could move out.

"I am not aware of anyone in my constituency who receives council tax benefit or housing tax benefit and owns a second home elsewhere," he said.

The Kents made a "minimal contribution" to Royal duties, he said, although Prince Michael told the Telegraph that the family "performed a lot of public ones".

Ian Davidson: Other uses for palace

Mr Davidson responded: "There are a lot of people in my constituency who do an enormous amount of charitable work in the community.

"But (they) do not expect the state to give them cheap or free housing."

The minister echoed calls from MPs for the Queen to evict Prince Michael and his family and put the apartments on a more commercial footing.

They want an end to the system allowing minor royals to live at the palace for low costs.

The Royal household itself had identified the property as "being surplus to requirements for the longer term", said Mr Davidson.

He added that if further public money was needed for minor royals to continue living there they should be moved out.

Public money

It was "essential to get them out in order that we could better use the building," he added.

Mr Davidson said the Palace "would be playing a useful role" if public exhibitions could be extended there.

The Kents are thought to pay �69 a week to live in the Palace

The Prince had declined to discuss in the newspaper if his family would be asked to leave the palace.

But the Prince condemned the "trivial and uninformed" public view of the controversially low rent he pays for a luxury apartment.

Prince Michael said: "The apartment is in the gift of the Queen so it isn't for me to speculate. We have not discussed it."

Asked if the couple might pay a commercial rent - estimated to be up to 100 times higher than the current amount - he replied it was also a matter for the Queen.

Prince Michael said: "We pull our weight for the family and the country. And we do it because we feel we are privileged, and privilege doesn't work without obligation."