Rachel Reeves has said Andrew Mountbatten-Windsor should repay funds into the public purse if he is found to have misused them.
The former prince was arrested on suspicion of misconduct in public office last week before being released under investigation, having spent 11 hours in custody on his 66th birthday.
He is accused of sharing sensitive information with paedophile financier Jeffrey Epstein during his time as the UK’s special representative for international trade and investment.
Since then, retired civil servants have claimed that Mr Mountbatten-Windsor allegedly used taxpayers’ money for massages and excessive travel costs during his time as the UK’s trade envoy.
The BBC reported that one ex-civil servant initially refused to cover the cost of a massage for Mr Mountbatten-Windsor but was overruled by senior staff. They told the broadcaster: “I thought it was wrong… I’d said we mustn’t pay it, but we ended up paying it anyway.”
A former Whitehall official, who oversaw finances, separately told the BBC they had “absolutely no doubt” about the claim’s authenticity, having seen similar expenses for his overseas trips.
The chancellor told The i that Mr Mountbatten-Windsor “of course” should pay back any money if he is found to have misused it.
Ms Reeves was also asked if she agreed with trade minister Chris Bryant’s verdict that the former Duke of York was a “rude, arrogant and entitled man”.
She responded: “Well, I’ve never met [Mountbatten-Windsor] and I think that’s probably for the best.”
Calls have grown from a range of public figures for a wider probe into Mr Mountbatten-Windsor’s past dealings with Epstein.
He has denied any wrongdoing over his links to the convicted sex offender, but has not directly responded to the latest allegations.
Despite being stripped of his title last year, Mr Mountbatten-Windsor is still eighth in line to the throne, and an Act of Parliament would be required to remove him, and prevent him from ever becoming king.
About that, the chancellor said: “In terms of the succession to the throne, the government have already said that we’re looking at that.”
Searches at Mr Mountbatten-Windsor’s former home, Royal Lodge, ended on Tuesday, Thames Valley Police said.
Assistant chief constable Oliver Wright said: “Officers have now left the location we have been searching in Berkshire. This concludes the search activity that commenced following our arrest of a man in his sixties from Norfolk on Thursday.
“We understand the significant public interest in this case and our investigation remains ongoing.
“It is important that our investigators are given the time and space to progress their work. We will provide updates when it is appropriate to do so, but this is unlikely to be for some time.”
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