In the case of a ‘money bill’ the Lords can delay only for one month

provided that the bill is sent to them at least one month before the end

of a session. A ‘money bill’ is a public bill which deals exclusively either

with central government taxation or central government spending, bor-

rowing or accounts. The certificate of the Speaker that a bill is a money

bill is conclusive for all purposes (1911 Act s. 3). This definition is fairly

narrow since few bills deal exclusively with these matters. The Speaker

must certify that the Parliament Act’s procedure has been followed and

his certificate cannot be challenged. The Parliament Act procedure has

been little used (see Welsh Church Act 1914; Government of Ireland

Act 1914, Parliament Act 1949). In practice, while the Lords sometimes

delay bills, they have in the end given way to the Commons.

The Parliament Acts do not apply to certain kinds of legislation.

These are as follows:

. local and private bills;

. bills confirming Provisional Orders (above);

. bills introduced in the House of Lords;

. a bill to prolong the life of Parliament. Because of this exemption

the House of Lords retains the key constitutional role of preventing

a government from avoiding an election by prolonging its own life.

274 General Principles of Constitutional and Administrative Law

The Parliament Act procedure may possibly not apply to a bill to

abolish or to reduce the powers of the House of Lords. This argument

assumes that a law passed by the Queen and Commons alone under

the Parliament Act is no more than a special kind of delegated

legislation and a delegate cannot enlarge its own powers without

statutory authority. It is therefore arguable that the Parliament Act

1949, which reduced the delaying power of the Lords, is void because

it was passed under the 1911 Act procedure without the assent of the

Lords. The Wakeham Commission (Wakeham, 2000) proposed that

it be made clear by a simple amendment to the Parliament Acts that

the Parliament Acts should not apply to a bill that affects the com-

position or powers of the House of Lords. Wakeham rejected any

other extension of the Lords’ power of veto on the ground that this

might risk upsetting the supremacy of the Commons. Wakeham

emphasised that, in the context of the House of Lords, the vague

concept of accountability means primarily that the Lords should pro-

vide a mechanism to make the government think again, rather than to

overrule the government.

12.3.5 The Royal Assent

The Royal Assent is not usually given by the monarch in person

but through commissioners who notify the assent to each House

separately (Royal Assent Act 1967). Some bills are assented to at the

Prorogation ceremony that ends each session when the Commons

attend the Lords in accordance with long-standing practice. By con-

vention the monarch must always assent, except possibly in the

unlikely event of the prime minister advising to the contrary. In this

case, however, the government would be at odds with the Commons

and so required to resign. The monarch’s function in such a case will

be discussed later.

Once a bill has received the Royal Assent it becomes law. However,

it is often provided that the Act, or specific parts of it, shall not take

effect until a minister so orders. A minister’s decision whether or not

to bring an Act into effect is subject to judicial review (see R. v.

Secretary of State for the Home Department ex parte Fire Brigades

Union (1995)). It is also common for an Act to confer power on

ministers to make detailed regulations without which the Act itself

cannot operate. These might include a ‘Henry VIII clause’ under

which a minister is empowered to alter other statutes.

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12.4 Financial Procedure

It is a fundamental principle embodied in both law and convention

that the House of Commons controls public finance. On the other

hand, modern government finance is so large and complex that such

control may be unrealistic. In practice the most substantial control

over government finance particularly in advance of spending is

exercised internally by the Treasury, which is itself accountable to

Parliament. Parliament is also assisted, particularly in relation to the

scrutiny of past expenditure, by the National Audit Office which is

independent of the executive.

The dependence of the executive on money voted by the people is an

essential feature of a democratic constitution. The constitutional

theory is that the Crown comes to the Commons to ask for money.

Hence financial measures can be proposed only by the Crown and the

Commons can reduce the estimates but not increase them (see SO 46).

The survival of a government depends upon the Commons voting it

funds, and the refusal of the Commons to do so is the equivalent of a

vote of no confidence so that the government must resign. By conven-

tion the House of Lords cannot amend measures relating to central

government finance and, as we have seen, can delay money bills only

for one month.

By virtue of the Bill of Rights 1688 the Crown cannot raise taxation

without the consent of Parliament. Payments into the consolidated

fund, the government’s bank account, require statutory authority

(Exchequer and Audit Act 1866 s. 11). Moreover it seems that cen-

tral government expenditure is unlawful unless authorised by statute

although this need not be in detail and usually consists merely of

global departmental estimates (Auckland Harbour Board v. R. (1924),

R. v. Secretary of State ex parte World Development Movement (1995)).

The main financial measures are embodied in three kinds of Act

passed each year. Firstly, the Finance Act deals with taxation. The

Royal Assent to a taxation measure is expressed in the words: ‘La

Reyne remercie ses bons sujets, accepte leur benevolence et ainsi le veult’

(The Queen thanks her good subjects, accepts their kindness and thus

assents), as opposed to the normal ‘La Reyne le veult’. Secondly, the

annual Appropriation Act authorises the spending programmes of each

government department. Thirdly, Consolidated Fund Acts authorise

government drawing from its bank account supervised by the Treasury.

In addition there is a principle that taxation and expenditure must first

be authorised by a resolution of the House of Commons (SO no. 48).

276 General Principles of Constitutional and Administrative Law

The resolution is proposed by a minister before the committee stage

which is usually taken before the whole House. Amendments cannot

be made outside the terms of the resolution, thus strengthening the

government’s hand.

12.4.1 Taxation procedure

The key taxation event is the annual ‘budget’ resolution proposed by

the Chancellor usually in March. This includes the Chancellor’s views

on the economy and overall strategy and proposals for tax changes.

It therefore sets the general economic framework of government policy.

The budget resolution is followed by the annual Finance Bill. This

includes taxes (notably, income tax) that must be authorised afresh

each year. These annual taxes are enforced and administered under

permanent legislation (Income and Corporation Taxes Act 1988).

Some taxes mainly indirect taxes such as customs duties are authorised

by permanent legislation although their rates can be changed at any

time. Constitutional principle is preserved in the case of EC law by the

requirement in the European Communities Act 1972 that EC laws

affecting taxation, e.g. VAT, must be implemented by a statute.

The effect of the budget resolution is that the budget’s main tax

proposals become law with immediate effect, but lapse unless

embodied in a Finance Act that becomes law by a specified time.

This is 5 August if the speech is in March or April, otherwise within

four months (Provisional Collection of Taxes Act 1968). This

procedure illustrates the basic constitutional principle that resolutions

of the Commons cannot by themselves change the law but need

statutory backing (Bowles v. Bank of England (1913)).

Central government money does not come exclusively from

taxation. Governments borrow large sums of money in the form of

bonds and on the international money market. Money is also raised

from landholding, investments both in the UK and overseas, and from

trading activities. These sources of finance are not subject to detailed

parliamentary scrutiny although statutory authority is required in

general terms for borrowing (National Loans Fund Act 1968).

12.4.2 Spending procedure

Most public expenditure must be authorised annually by the Appro-

priation Act which approves the government’s estimates. These include

‘votes’ setting out the government’s proposed allocation of funds

between departments. Thus the Commons approves not only the global

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Parliamentary Procedure

sum but also the executive’s broad priorities. The annual Appropriation

Act and Consolidated Fund Acts (which authorise temporary borrow-

ing in advance of approval of the estimates) are usually passed without

debates. Debates on the estimates have been replaced by 20 ‘opposition

days’ which allow the opposition parties to raise anything they wish,

and by special ‘adjournment debates’ following the passage of the Acts.

The latter allow issues to be discussed without a vote.

Some items of expenditure are permanently authorised. These are

called consolidated fund services. They include judicial salaries, royal

expenses, European Community payments and interest on the national

debt. In practice, however, most government spending is the subject of

long-term commitments (e.g. National Insurance), thus leaving little

flexibility.

12.4.3 Supervising expenditure

Money raised by the central government goes into the ‘consolidated

fund’. The control of spending from the consolidated fund is the

responsibility of the Commons, but given the size and complexity of

modern government this is clearly an impossible task for an elected

assembly. In practice, direct parliamentary control over expenditure is

very limited. The Public Accounts Committee admitted in 1987 that

parliamentary control over the estimates is largely a formality (HC 98

(1986–7) para. 2). In medieval times the Court of Exchequer super-

vised government spending, but the modern courts have relinquished

this responsibility in favour of Parliament. The courts are therefore

reluctant to interfere with central government spending decisions which

are subject to parliamentary scrutiny (see Nottinghamshire CC v.

Secretary of State (1986)).

However, in R. v. Secretary of State for Foreign and Commonwealth

Affairs ex parte World Development Movement (1995) a Foreign Office

decision to give a large grant to the Malaysian government for the

Pergau Dam project was set aside by the Court of Appeal on the basis

that the project had no economic justification and that there was

an ulterior political motive. In that case the governing legislation

specifically required that the decision be based on economic grounds,

which, crucially, the court equated with ‘sound’ economic grounds (see

Harden et al., 1996) and parliamentary approval was not required.

In the case of local government, the courts are more willing to police

financial decisions, using the concept that a local authority owes a

fiduciary duty analogous to that of a trustee to the local ratepayer (see

Bromley LBC v. GLC (1983)).

278 General Principles of Constitutional and Administrative Law

The most effective controls are, in characteristically English fashion,

imposed within the government machine itself by the Treasury and are

an example of the importance of internal rules base on the inherent

power of any employer to administer its workforce. Harden et al.

(1996) describe this as a ‘self-regulatory system relying on trust and elite

consensus’ (see Government Accounting, 1989). Each department and

agency has authority from the Treasury to spend within prescribed

limits and has an accounting officer, appointed by the Treasury, who is

responsible for administering the financial controls prescribed by the

Treasury and can be questioned by parliamentary committees. The

Treasury exercises statutory control over the form of government

accounts, in particular in relation to public, private partnerships and in

the allocation of expenditure between different years (Government

Resources and Accounts Act 2000).

Public expenditure of central departments and other public bodies

related to the centre is scrutinised by the Comptroller and Auditor

General supported by the National Audit Office. The Comptroller is

appointed by the Crown on a motion from the House of Commons

proposed by the prime minister with the Agreement of the Chair of the

Public Accounts Committee (Exchequer and Audit Depts Acts 1866–