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the Commons members of the Committee sitting without the peers.) The
Committee determines whether the special attention of each House should be
drawn to any instrument on grounds not impinging on its merits or policy “ for
example, if its drafting appears to be defective, or if it is excluded by the enabling
Act from challenge in the courts, or if there is doubt whether it is intra vires, or
if it ˜appears to make some unusual or unexpected use of the powers conferred
637 Parliament and the responsibility of government


by the statute under which it is made™. (See SO 151.) Before reporting to the
House the Committee must give the department concerned an opportunity to
provide an explanation.
When a signi¬cant technical defect is discovered by the Joint Committee, the
department concerned is usually willing to amend the instrument. If it declines
to do so, members may attempt to use such opportunities as are provided by
the a¬rmative or negative procedure to oppose the instrument in the House.
If no parliamentary procedure is prescribed by the enabling Act, other occa-
sions may be found for raising the question on the ¬‚oor of the House. But an
˜adverse report by the Committee has no e¬ect on the manner in which an
instrument is considered, and there is no procedure to prevent a substantive
decision [by the House of Commons] before the Committee has completed
its consideration™ (Procedure Committee, First Report, HC 588-I of 1977“78,
para 3.8).
The Regulatory Reform Committee of the House of Commons scrutinises
and reports on draft orders laid before the House under the Legislative and
Regulatory Reform Act 2006. A wider scrutiny of statutory delegations of leg-
islative power is carried out by the Delegated Powers and Regulatory Reform
Committee of the House of Lords (see further chapter 7).
Both the Procedure Committee and the Joint Committee on Statutory
Instruments have urged the adoption of a standing order precluding any deci-
sion by the House on a statutory instrument before it has been considered by the
Joint Committee. (See Procedure Committee, First Report, HC 48 of 1999“00,
para 21.) Provision to this e¬ect is already made in standing orders of the House
of Lords.
See generally Hayhurst and Wallington, ˜The parliamentary scrutiny of dele-
gated legislation™ [1988] PL 547; Report of the Hansard Society Commission on
the Legislative Process (1992), paras 364“87; A Brazier (ed), Parliament, Politics
and Law Making (2004), ch 5; Salmon, ˜Scrutiny of delegated legislation in the
House of Lords™ (2005) The Table 46.


(c) Finance
˜The real power to have in Parliament is control over money™ (Mr Edward
du Cann, MP, in D Engle¬eld (ed), Commons Select Committees: Catalysts for
Progress? (1984), p 38). Parliament exercises a formal ¬nancial control over the
government in that its authority has to be obtained for taxation and the expen-
diture of public money. In practice the ¬nancial control and accountability of
government depend on a variety of parliamentary procedures of which some
have been relatively e¬ective and others decidedly weak. Public ¬nance and
expenditure, the process of ˜getting and spending™, was until recently neglected
by parliamentary reformers. But the raising and expenditure of public money
involves choices between di¬erent policy goals and can profoundly a¬ect the
prosperity of the country and the distribution of wealth in society.
638 British Government and the Constitution


Taxation may be proposed only on behalf of the Crown and has to be autho-
rised by Parliament (see above, pp 140“1). Much of it is provided for in perma-
nent legislation, but rates of income, corporation and other taxes are ¬xed for
the year, and new taxes may be introduced, in an annual Finance Bill which
follows the presentation of the Budget and the approval of ways and means res-
olutions in the House of Commons. The House accordingly has opportunities
to debate proposals for taxation when ¬scal legislation and Budget resolutions
are before it. The government is, admittedly, unlikely to agree to signi¬cant alter-
ations to the Budget and, as the Treasury and Civil Service Committee noted,
˜Although the tablets of stone on which the Finance Bill is written can in theory
be amended during its consideration, in practice the Government™s reputation
is at stake and so major substantive amendments are rare™ (Sixth Report, HC 137
of 1981“82, para 2.1). Yet it has been remarked that the Commons debates on
the Finance Bill ˜are often some of the best argued and most e¬ective of any held
in the House™ (R Blackburn and A Kennon, Gri¬th and Ryle on Parliament (2nd
edn 2003), para 6-188), and the hazards of politics may, exceptionally, compel
the government to give way, as in December 1994 when it retreated from the
imposition of additional VAT on domestic fuel. On the other hand, the Treasury
select committee has expressed dissatisfaction with procedure on the Finance
Bill, ˜which lets badly drafted and insu¬ciently tested tax legislation onto the
statute book every year™ (Third Report, HC 73-I of 2000“01, para 54).
In 1997 the Labour Government announced measures for wider consultation
on Budget proposals, in particular through publication of a ˜Pre-Budget Report™
(Financial Statement and Budget Report, HC 85 of 1997“98, para 1.30). The Pre-
Budget Report appears in the autumn, allowing several months for consultation
(with bodies such as the Institute of Chartered Accountants and the Chartered
Institute of Taxation) before the Budget.
Another source of government revenue, borrowing, largely escapes parlia-
mentary scrutiny, although it has been of great importance in the management
of the economy. The Select Committee on Procedure (Finance) recommended
that the House of Commons should be given formal power to approve the
Government™s annual borrowing requirement (First Report, HC 24-I of
1982“83, para 44), but the Government did not accept this.
The fundamental principle relating to expenditure by the government is
stated in the Treasury™s handbook, Government Accounting 2000 (para 11.2.1):

Under long-established constitutional practice, the Crown (the government) demands
provision, the House of Commons grants it, and the House of Lords assents to the grant.

Money is ˜granted™ (ie expenditure is authorised) by Parliament only on the
˜demand™ of the Crown. This exclusive ¬nancial initiative of the Crown has been
an important element in the establishment of the government™s ascendancy
over Parliament. The rule, as Gordon Reid says (The Politics of Financial Control
(1966), p 44), provides governments with ˜a powerful controlling technique™,
639 Parliament and the responsibility of government


and ˜protects parties in government from the political embarrassment of having
to vote against a wide range of alternative proposals, initiated in other parts of
the House, and designed to appeal to the electorate™. Parliament cannot increase
the items of expenditure submitted to it by the government or vote for the
expenditure of money on objects of its own choice.
Nevertheless the formal requirement that expenditure must be authorised by
Parliament opens up the possibility of an exercise of some control or in¬‚uence
by the House of Commons over the government™s spending policies.
The bulk of government expenditure is approved annually by Parliament in
voting ˜supply™: Estimates of departmental expenditure are laid before the
Commons by the Treasury and, once approved by resolution of the House, are
con¬rmed by legislation (Appropriation Acts or a Consolidated Fund Act),
giving authority for the money to be issued from the Consolidated Fund.
Expenditure that does not require the annual approval of Parliament consists of
certain payments charged directly by statute on the Consolidated Fund “ for
example, judges™ salaries and payments to the European Union “ and moneys
issued from the National Loans Fund, for example, loans or advances to public
corporations and local authorities. Some departmental activities are ¬nanced
through Trading Funds, which fall outside the parliamentary supply process.
The detailed scrutiny by the House of Commons of the proposed supply
expenditure of government departments was abandoned long ago, and the gov-
ernment™s Estimates presented to the House came to be passed ˜on the nod™. In
1880 the House voted to reduce an Estimate by £80, the cost of providing food
for the pheasants in Richmond Park (P Einzig, The Control of the Purse (1959),
p 271), but a century later a vote of £500 million would be approved without
debate. Supply days had come to be used for debating questions of policy or
administration chosen by the Opposition rather than for the detailed examina-
tion of departmental Estimates. (These are now ˜Opposition days™, uncon-
nected with the supply procedure. Since 1982 three days have been allotted in
each session for debates on the Estimates, the subjects for debate being chosen
on the recommendation of the Liaison Committee. These debates, too, are
usually on matters of general policy, focusing on reports from the departmen-
tal select committees; voting on Estimates has become a formality, and the
power of the House over expenditure has become, in the words of the Procedure
Committee, ˜if not a constitutional myth, very close to one™ (Sixth Report, HC
295 of 1998“99, para 4).
There have undoubtedly been substantial improvements in the comprehen-
siveness and quality of the ¬nancial information provided to Parliament.
Several of the departmental committees have responded by taking a greater
interest in the material provided, examining departmental Estimates or the
departments™ Annual Reports which describe their activities and performance
over the previous year and set out their future spending plans. This is one of
the ˜core tasks™ of the committees (see above, p 616), but their coverage of
government expenditure is not complete or systematic.
640 British Government and the Constitution


In 1997 the Government announced that public expenditure planning would
in future be based on forward spending reviews, departments being set ˜¬rm
plans and ¬xed budgets for three years at a time™. A Comprehensive Spending
Review to be launched in 2007 is to be a ˜long-term and fundamental review of
government expenditure™ and will include spending allocations to departments
for 2008“09, 2009“10 and 2010“11. Each spending review is followed by a half-
day debate in the Commons and may be examined by the Treasury Committee.
The Treasury negotiates ˜public service agreements™ with departments which
relate to the three-year review, setting targets to be achieved by the departments
in the use of the money to be allocated to them. It is a core task of the depart-
mental committees to examine the departments™ public service agreements and
the associated targets. These innovations have strengthened the role of the
Treasury with respect to spending and policy-making by other government
departments, and there are increased opportunities for Parliament to scrutinise
decision-making on public expenditure.
A reform which took full e¬ect from 2001“02 was the change to a system of
resource-based supply and accounting, in place of the traditional, exclusively
cash-based system. Parliament approves expenditure expressed in terms of costs
to be incurred, as well as the cash actually to be spent in the year ahead. Resource
estimates and accounts (replacing the former cash-based appropriation
accounts) provide Parliament with more comprehensive ¬nancial information
and have the potential of improving parliamentary control. It is unfortunate,
however, that recommendations of the Procedure Committee designed to
strengthen parliamentary scrutiny of government expenditure (Sixth Report,
HC 295 of 1998“99) were for the most part rejected by the Government.
(See further McEldowney, ˜The control of public expenditure™, in J Jowell
and D Oliver, The Changing Constitution (5th edn 2004), ch 15; T Daintith
and A Page, The Executive in the Constitution (1999), chs 4“6; F White and
K Hollingsworth, Audit, Accountability and Government (1999); Report of
the Hansard Society Commission, The Challenge for Parliament: Making
Government Accountable (2001), ch 5; Lord Sharman, Holding to Account: the
Review of Audit and Accountability for Central Government (2001).)

(i) Public Accounts Committee
Parliament also needs to check that expenditure by the government has been for
the purposes authorised and that value for money has been obtained. Since
1861 this ex post facto scrutiny has been carried out on behalf of the House of
Commons by its Public Accounts Committee, of which the chairman is always,
by convention, a member of the Opposition. The work of the Committee is
closely linked with that of the Comptroller and Auditor General, who examines
and reports to Parliament on the annual accounts of government departments,
executive agencies and a wide range of other public bodies, drawing attention
to any losses, extravagance or impropriety that he may have discovered. In addi-
tion the Comptroller conducts special investigations during the year into the
641 Parliament and the responsibility of government


˜economy, e¬ciency and e¬ectiveness™ with which government departments
and other public bodies have used their resources, presenting the results to
Parliament in a succession of ˜Value for Money™ reports (around ¬fty a year).
(Recent reports have covered such matters as ˜Progress on the channel tunnel
rail link™, ˜Reducing vehicle crime™, ˜Improving adult literacy and numeracy™,
˜Prisoner diet and exercise™.) The reports of the Comptroller and Auditor
General are considered by the Public Accounts Committee, which questions
departmental Accounting O¬cers and other senior o¬cials on the matters to
which the Comptroller has drawn attention, and itself reports to Parliament on
the results of its inquiries. The Committee™s reports to Parliament have, over the
years, revealed many instances of waste and failure of ¬nancial control, and the
Committee is said to have ˜contributed signi¬cantly to the maintenance of high
standards in the handling of public money by the Civil Service™ (Procedure
Committee, First Report, HC 588-I of 1977“78, para 8.3).
The importance of the Public Accounts Committee™s work appears from its
report on the Chevaline project (Ninth Report, HC 269 of 1981“82). The
Ministry of Defence embarked on this programme for the improvement of the
Polaris missile system in the late 1960s, and the ¬rst cost estimate for the project
was £175 million. The Secretary of State for Defence informed the House of
Commons of the project in January 1980, and announced that the estimated
cost had risen to £1,000 million. The Committee decided to investigate
Chevaline and in due course reported to Parliament its ¬nding of signi¬cant
weaknesses in the Department™s management and control of the project, with
serious underestimates of costs and timescales. The Committee also drew atten-
tion to more general grounds for disquiet (para 15):

In the case of Chevaline a major project costing £1,000 million continued for over ten years
without Parliament being in our view properly informed of its existence and escalating costs.
Expenditure each year was included in the normal way in the Defence Estimates and
Appropriation Accounts; our criticism is that the costs were not disclosed, and that there was
no requirement that they should be disclosed. Incidental and oblique references to a Polaris
enhancement programme made in Parliament or to Parliamentary committees in our view
do not provide sufficient information for Parliament to discharge its responsibility to scruti-
nise major expenditure proposals and to exercise proper financial control over supply.

The Government in reply agreed to provide the Public Accounts Committee
with ¬nancial information about major defence projects in future (Treasury
Minute, Cmnd 8759/1982): see Report by the Comptroller and Auditor General,
HC 238 of 1997“98.
In its Eighth Report for 1993“94 (HC 154), the Public Accounts Committee
drew the attention of Parliament to serious instances of mismanagement and
misuse of public funds in government departments and non-departmental
public bodies, observing that these represented ˜a departure from the standards
of public conduct which have mainly been established during the past 140 years™.
642 British Government and the Constitution


The Public Accounts Committee works on non-party lines and its reports,
which are in practice unanimous, are debated each year in the House of
Commons. The great majority of the Committee™s recommendations are
accepted by the government.
It is important that the Comptroller and Auditor General should be
independent of government. The o¬ce was formerly thought to be too closely
associated with the Treasury; the Government agreed to a change in the status
of the o¬ce only under considerable backbench pressure and after a private
member™s bill to reform the system of state audit had won widespread support
from MPs. The National Audit Act 1983 established the Comptroller and
Auditor General as an o¬cer of the House of Commons who is appointed by
the Crown on an address from the House, moved by the Prime Minister with
the agreement of the chairman of the Public Accounts Committee.


5 The House of Lords
In considering the control and accountability of government we have concen-
trated on the role of the House of Commons. We have, however, already noted
some of the ways in which the House of Lords takes part in the supervision of
the executive “ for example, through the work of its Select Committees on the
European Union and on the Merits of Statutory Instruments and its participa-
tion with the House of Commons in the Joint Committee on Statutory
Instruments. We have also noted the establishment of the Lords™ Delegated
Powers and Regulatory Reform Committee and Special Public Bill Committees.
We saw, too (in chapter 5), that peers join with MPs in the Joint Committee on
Human Rights, which considers a range of matters relating to human rights in

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