IV. UNITED KINGDOM

considerable budgetary autonomy and flexibility to execute particular aspects of government policy. Around 75% of civil servants now work for such agencies, whose budgets are part of the parent department’s budget. These far-reaching changes were introduced without new parliamentary legislation.

In the 1990s, the government planned a major accounting reform, which culminated with the adoption, by statute, of an accrual-based government accounting system. The GRA Act 2000 replaced the previous cash-based system introduced by statute one-and-a-half centuries earlier. Like many statutes, only the bare essentials are contained in the GRA Act. H.M. Treasury is delegated much of the responsibility for implementing this law. H.M. Treasury also proposes the appropriation structure. In recent years, there has been considerable simplification: the number of estimates (units of appropriation for government departments) was reduced from 167 in 1989/90 to 52 in 2004/05. Also, the number of “programmes” within each estimate is often only one; only in two departments does the number of programmes exceed three. This compares with very detailed line-item cash expenditure 30 years earlier.

Similarly, a section of the 1998 Finance Act requires that H.M. Treasury lays before the House of Commons a Code for Fiscal Stability (CFS). This code emphasises five principles for fiscal policy and requires H.M. Treasury to prepare, on behalf of the government, reports outlining past and prospective developments in fiscal and debt management, including the adherence with the government’s fiscal rules.

2. Principles underlying budget system laws

Unlike continental European countries, new practices have traditionally been absorbed into legal documents without much discussion of their compatibility with existing principles. In part this reflects the absence of a written constitution. In the United Kingdom, the unwritten constitution can be viewed as a system of values that is continually in the process of being discovered, rather than an overarching set of norms. Where important changes occur and are not reversed, the constitution may be said to be changing. Thus, there is little tension between what the unwritten constitution “requires” and what is actually done.

Although principles, as a foundation for law, have been downplayed, for a long time the principle of parliamentary “control of the purse” has been embodied in law. This includes:

●Statutory authorisation – of taxation and of expenditure of public funds.

●Propriety and regularity – approval by Parliament – of departmental activities.