If committees are going to do a better
job of examining the Estimates, they need more opportunities to influence
expenditure, more authority, and better information. Once improvements have been
made, committees should be able to bring new attitudes and approaches to their
study of the Estimates.
Standing Committee on Procedure and House Affairs, Fifty-First Report
(The Business of Supply: Completing the Circle of Control) presented to the House on December 10, 1998 (Journals, p. 1435)
T
he development of parliamentary procedure
is closely bound up with the evolution of the financial relationship between
Parliament and the Crown. As the Executive
power, [1]
the Crown is
responsible for managing all the revenue of the state, including all payments
for the public
service. [2]
The Crown,
on the advice of its Ministers, makes the financial requirements of the
government known to the House of Commons which, in return, authorizes the
necessary “aids” (taxes) and “supplies” (grants of
money). No tax may be imposed, or money spent, without the consent of
Parliament.
The direct control of national finance has
been referred to as the “great task of modern parliamentary
government”. [3]
That control is exercised at two levels. First, Parliament must assent to all
legislative measures which implement public policy and the House of Commons
authorizes both the amounts and objects or destination of all public
expenditures. Second, through its review of the annual departmental performance
reports, the Public Accounts and the reports of the Auditor General, the House
ascertains that no expenditure was made other than those it had
authorized. [4]
The practices and procedures which govern
how Parliament deals with the nation’s finances are set out principally in
the Constitution Act,
1867, [5]
the Financial Administration Act, [6]
unwritten conventions, and the rules of the House of Commons and the Senate.
Basic Components of Financial Operations
The basic components of parliamentary financial procedure may be succinctly described as follows:
Consolidated Revenue Fund: the
account into which the government deposits taxes, tariffs, excises and other
revenues, once collected, and from which it withdraws the money it requires to
cover its expenditures. [7]
Royal Recommendation: the
instrument by which the Crown advises Parliament of its intent to introduce a
legislative measure having an impact on the Consolidated Revenue
Fund. [8]
Under the
Constitution, all such legislative measures must be initiated by the Crown and
originate in the House of Commons.
Supply: the process by which the
government submits its projected annual expenditures (the Estimates) for
parliamentary approval.
Borrowing Authority: the
authorization required by the government to make up any shortfall between
revenues and expenditures.
Ways and Means: the process by which
the government sets out its economic policy (the Budget) and obtains necessary
authority to raise revenues through taxation.
Public Accounts: the annual
statement and review of the government’s expenditures.
The Financial Cycle
The fiscal year of the Government of Canada
runs from April 1 to March
31. [9]
However, the
planning for the fiscal year begins much earlier with the preparation of
departmental expenditure plans, which are developed in accordance with the
government’s policy and budgetary priorities, and the pre-budget
consultations by the Standing Committee on
Finance. [10]
The
expenditure plans are submitted to the House in their consolidated form as the
“Main Estimates”. At the same time, the Department of Finance is
compiling the information taken in during the pre-budget consultations and
preparing its economic forecasts. The government’s efforts to reconcile
its spending obligations and revenue projections are reflected in the
Budget.
The Budget outlines the government’s
fiscal, social and economic policies and priorities, while the Estimates set
out, in detail, its projected expenditures for the upcoming fiscal year.
Typically, the Budget is presented in the second half of February, although the
government is under no obligation to do
so. [11]
Under normal
circumstances, the Main Estimates are tabled in the House on or before March 1
and submitted for concurrence by the House no later than June 23. [12]
Should the government require funds while
waiting for, or in the absence of, income from taxes and other revenue sources,
it will seek authority to borrow. Should there be a change in the
government’s requirements as set out in the Main Estimates, Parliament
will be asked to approve “supplementary” Estimates.
The tabling of the Public Accounts of
Canada and the Annual Report of the Auditor General, and their review
by the Standing Committee on Public Accounts, completes the government’s
annual cycle of financial
transactions. [13]
Historical Perspective
The manner in which Canada deals with
public finance derives from British parliamentary procedure, as practised at the
time of
Confederation. [14]
The
financial procedures adopted by the Canadian House of Commons in 1867 were
formed by the following principles:
- that although Parliament alone
might impose taxes and authorize the use of public money, Parliament can do this
only on the recommendation of the Crown (royal recommendation), in Canada
represented by the Governor General;
- that the House of Commons has the
right to have its grievances addressed before it considers and approves the
financial requirements of the Crown;
- that the House of Commons has
exclusive control over the business of public finance (taxing and spending) and
all such business is to be initiated in the lower
house; [15] and
- that all legislation sanctioning
expenditure or initiating taxation is to be given the fullest possible
discussion, both in the House and in
committee. [16]
British Precedents
The whole law of finance, and
consequently the whole British constitution, is grounded upon one fundamental
principle, laid down at the very outset of English parliamentary history and
secured by three hundred years of mingled conflict with the Crown and peaceful
growth. All taxes and public burdens imposed upon the nation for purposes of
state, whatsoever their nature, must be granted by the representatives of the
citizens and taxpayers, i.e., by
Parliament. [17]
The requirement that legislation sanction
all public spending and taxation has a long constitutional
history. [18]
In
medieval England, the King was expected to meet most public expenses (the court,
the clergy and the military) out of his personal revenues. Where this was not
possible, he was obliged to seek funds by summoning the common council of the
realm, or parliament, to discuss what aids (taxes and tariffs) should be
supplied to support the Crown. Even in the earliest days of these assemblies, it
was generally recognized that, when “aids” or “supplies”
were required, the King should seek consent not only to impose a tax, but also
for the manner in which the revenues from that tax might be spent. In 1295, the
writ of summons for one of these councils, later known as the “Model
Parliament”, proclaimed: “What touches all should be approved by
all”.
Early British Parliaments were not
legislative bodies as we understand them today, but petitioning bodies. They
presented petitions to the King and agreed to taxes (i.e., money granted to the
Crown), on the condition that certain problems (or grievances) outlined in the
petitions would be addressed or concessions made. By 1400, the Commons insisted
that the King respond to their petitions before any grant of money was made.
When the King refused, they adopted the practice of delaying the grant until the
last day of the session.
The “councils” subsequently
divided into two “Houses” based on their communities of interest:
the House of Lords and the House of Commons. In principle, each House taxed
itself independently; for this reason it was not considered appropriate that the
Lords determine what the Commons should contribute. Moreover, because the
greater part of the tax burden fell to the Commoners, grants to the Monarch came
to be made by the Commons “with the advice and consent” of
the Lords. The dominant position of the Commons in terms of deciding matters of
taxation was firmly established early in the fifteenth century when Henry IV
conceded that any grant to the Sovereign must be agreed upon by both the Lords
and the Commons and must be communicated to the Crown by the Speaker of the
House of Commons. [19]
Initially, the Commons were content simply
to have grants of Supply originate in their House. However, over time the Lords
began “tacking on” additional legislative provisions to Commons
“money bills”, by way of amendments. This was viewed by the House as
a breach of its prerogative to originate all legislation which imposed a charge
either on the public or the public purse, and led the Commons, in 1678, to
resolve that:
All aids and supplies, and aids to his
Majesty in Parliament, are the sole gift of the Commons; and all Bills for the
granting of any such aids and supplies ought to begin with the Commons: and that
it is the undoubted and sole right of the Commons to direct, limit, and appoint,
in such Bills, the ends, purposes, considerations, conditions, limitations, and
qualifications of such grants; which ought not to be changed or altered by the
House of Lords. [20]
By the end of the seventeenth century, the
principles of modern financial procedure — most particularly the annual
treatment of finance by the House of Commons and the notion of effective and
permanent House control over all public expenditure — were well established.
Their evolution had taken several centuries and was related to the rise and
gradual abolition of the Civil List, the creation of the Consolidated Fund and
the growth of the “estimates” system, whereby the government
receives annual operating grants from Parliament.
The Civil List
The Civil
List [21]
was initially
a list of all non-military personnel in the service of the Crown for whom
remuneration was paid by
Parliament. [22]
These
included individuals in the personal employ of the Sovereign, such as domestic
servants, people in the diplomatic service and various public officials and
civil servants. Previously, the Crown had covered these expenses out of the
Sovereign’s hereditary revenues and certain taxes voted to the Sovereign
for life by Parliament.
Initially, Parliament did not concern
itself with how the funds were spent. In general, it was felt that, while the
Crown was not entitled to increase its revenue without the Parliament’s
consent, it was perfectly free to dispose of, as it pleased, any funds properly
in its possession. However, the amounts voted by Parliament were frequently
insufficient and the House was increasingly asked for additional grants to
discharge debts which the Sovereign had incurred to cover the shortfall. So
emerged the practice of allocating to the Crown funds for specific
purposes.
With the accession of Queen Victoria to the
throne in 1837, Civil List expenditures were reduced to those required solely to
meet the personal needs of the Sovereign and her family. All other civil
expenses were taken over by the national treasury and paid out of the
Consolidated Fund.
The Consolidated Fund
During the seventeenth and eighteenth
centuries, the raising and spending of public money were intimately connected.
Requests from the Crown for money, in estimated amounts for specified purposes,
were considered and approved by a Committee of the Whole House. This phase
concluded, a second Committee of the Whole considered the recommended
“ways and means” for raising the money required to cover the amounts
approved. The work of the first committee, which came to be known as the
Committee on Supply, led directly to the work of the second, the Committee on
Ways and Means. Only when the latter came to a decision, would a bill be
introduced which empowered the Crown to raise money in the amount and in the
manner approved by the Committee on Ways and Means and to spend up to the amount
approved, and only for the purposes designated, by the Committee on
Supply.
The close coupling of taxing and spending
continued until 1786 when the establishment of the Consolidated
Fund [23]
abolished the
need to match a particular outlay with a specified
revenue. [24]
Once the
Committee of Supply had agreed to the expenditure of certain sums, the Ways and
Means Committee would look to the Consolidated Fund to pay for the approved
expenditures. The concept of an appropriation bill was introduced to set
aside from the Fund the amounts required for the purposes designated.
Appropriation bills merely set aside funds; they do not require the Crown to
spend all or any of the money which has been appropriated. Furthermore,
appropriations are always made with a time limit; the spending authorization
provided under an appropriation act expires at the end of the fiscal year to
which the Act applies. [25]
Thus, two distinct kinds of government
financial business emerged: the business of Supply, which approved expenditures
and their purposes, and resulted in the passing of appropriation bills; and the
business of Ways and Means, which resulted in the taxation bills used to raise
the monies needed to replenish the Consolidated Fund.
Since the institution of the Consolidated
Fund, all expenses of the state have been authorized either by specific statute
(ongoing and permanent) or by way of an annual appropriation. It is the annual
appropriations, or supply grants, which come before the House for discussion
each year.
The Estimates
As the seventeenth century drew to a close,
England’s continuing colonial disputes with France and Spain and the
recent experience of two civil wars made evident the need to maintain a national
standing army under the control of Parliament. Previously, the Monarch had
simply raised armies to fight wars, as required.
The institution of a permanent military
establishment carried with it the requirement for grants to cover the cost of
personnel, wars and
fortifications. [26]
In
1689, the British Parliament passed the Mutiny Act, legislation which had
to be renewed yearly. The Act restricted the use of martial law and gave
authorization for a definite number of military personnel. The Act also
authorized a grant of funds sufficient to cover military wages, ordnance and
shipbuilding for that year. This, then, was the means by which Parliament
undertook the regular annual charge of Supply for the army and navy, and from
which emerged the parliamentary practice of granting annual appropriations for
the operations of government. The principles governing that practice hold that
the government may spend on public administration no more than the amounts
(estimates) approved by Parliament and is similarly prohibited from using funds
voted for one purpose to pay for another (engaging in
virement). [27]
As the scope of civil government expanded, civil expenditure came to comprise a
number of expenses funded solely by annual parliamentary
grants. [28]
Financial Procedure in Colonial Canada
By the end of the eighteenth century, most
of the British North American colonies had acquired representative political
institutions. [29]
For
many years, colonial governance was fraught with dissension as a result of the
often irreconcilable interests of appointed governors and elected
representatives. Much of that conflict arose over the issue of who should
control the public
purse. [30]
However, by
the time of Confederation, the popular assemblies of British North America had
asserted their right to decide what taxes should be raised and where they would
be spent, thus fulfilling the principle of responsible government, which holds
that the executive may only govern while it enjoys the confidence or support of
the House of Commons. Parliament’s rights and role in the processes of
taxing and spending may be found in the various rules and procedures of the
legislatures from which they
derive. [31]
In 1867,
the Canadian House of Commons adopted the rules of the former Legislative
Assembly of the Province of Canada, including those covering the process of
taxing and spending. [32]
Upper Canada
Initially, the colonial administration of
Upper Canada was paid for entirely by the British Parliament. However, in 1817,
the Executive asked the Assembly for a grant of money to cover certain
administrative costs which exceeded the amount authorized by Westminster.
Previously, Britain had covered any excesses; but, in view of the growing wealth
and relative prosperity of the colony, the local community was asked to
subsidize these expenditures. Not surprisingly, the elected representatives
demanded a say in how the money would be spent. Moreover, they asked that the
Governor and his Executive Council not spend money which the Assembly had not
authorized, nor for purposes other than those it had
designated.
Supply (the authority to spend) was rarely
withheld. [33]
Even
when it was withheld (in 1818, 1825 and 1836), it was inconsequential. In fact,
the Crown appeared relatively indifferent to the sums voted by the House.
Nonetheless, the House continued to take the Supply process seriously, resolving
that the misapplication of parliamentary appropriations was a “high
crime” and affirming the undoubted right of the elected House to determine
how, and how much, public money was spent.
By 1840, Supply proceedings in the Assembly
had become relatively formalized. Estimates were referred upon presentation to a
permanent Select Committee on Finance. The committee’s report would be
referred to a Committee of Supply (a Committee of the Whole
House) [34]
which, in
turn, would report back to the House a number of resolutions, each of which
recommending that money be appropriated for some item. Once adopted, these
resolutions would be referred to a special committee of two members charged with
drafting the bills based thereon. A number of bills would then be
presented.
Lower Canada
Prior to 1818, the Executive Council
requested no funds from the House of Assembly of Lower Canada, with the result
that no Estimates were tabled. Nevertheless, the House attempted to exert some
financial control by way of its annual review of the public accounts. Until
1812, the accounts were examined in a Committee of the Whole, after which they
were referred to a special committee of five members. Beginning in 1818,
Estimates were also referred to this committee. The committee’s frequent
criticisms of the administration for appropriating money without the consent of
the House of Assembly prompted the House to resolve that the appropriation of
the public revenue without legislation was “a breach of the privileges of
this House, and subversive of the Government of this Province, as established by
Law”. The House further warned that it would hold the Receiver General
responsible for all monies
levied. [35]
The House of Assembly used various other
procedures in its efforts to control the administration, including refusing
Supply, refusing to deal with all legislation until basic grievances were met
and “tacking” on clauses to bills appropriating revenue for which
there was no existing statute, a practice which forced the Executive to choose
between enacting the additional clauses or losing Supply.
The Province of Canada
In 1840, the British Parliament passed the
Union Act uniting Upper and Lower
Canada. [36]
With its
enactment came the acknowledgement that a government should enjoy the confidence
of the people’s
representatives. [37]
It is also by the Union Act that the royal prerogative in right of
financial legislation was first introduced into Canadian parliamentary law.
Prior to 1840, any elected member in the legislatures of Canada could introduce
a bill with financial implications for consideration of the assembly. This
practice was much frowned upon by governors on the grounds that it interfered
with the efficient operation of
government. [38]
Lord
Durham felt strongly that “The prerogative of the Crown which is
constantly exercised in Great Britain for the real protection of the people,
ought never to have been waived in the Colonies; and [that if] introduced … it
might be wisely employed in protecting the public interests, now frequently
sacrificed in that scramble for local appropriations, which chiefly serves to
give an undue influence to particular individuals or
parties.” [39]
Provision was made for a Consolidated
Revenue Fund against which would be charged all expenses related to the
collection, management and receipt of revenue, all interest on the public debt
and remuneration of the clergy and officials included on the civil
list. [40]
Any surplus
remaining in the fund after these charges had been deducted could be used for
the service of the public, as the legislature thought
fit. [41]
All votes,
resolutions or bills involving expenditure of public funds were to be first
recommended by the governor
general. [42]
There were still disputes over the control
of money. However, no administration was defeated over an appropriation act; in
fact, even when governments changed, a supply bill was often taken over and
carried through by the succeeding
administration. [43]
By
1867, the vote of confidence had virtually replaced withholding Supply as the
preferred mechanism by which the Assembly sought control over the administration
of government.
Financial Procedure in the Canadian House of Commons
The Constitution Act, 1867 provided
that any bill appropriating any part of the public revenue or imposing a tax or
duty must originate in the House of
Commons. [44]
Furthermore, the Act made it unlawful for the House to pass any measure to
appropriate public revenues or impose a tax or duty which had not first been
recommended by the Governor General in the Session in which the measure was
proposed. [45]
Additional clauses provided for the creation and use of a Consolidated Revenue
Fund by the Parliament of Canada for the public
service. [46]
Standing Orders (1867-1968)
The first Standing Orders of the House of
Commons codified long-established rules of parliamentary practice and procedure,
which were rooted in British parliamentary history and, subsequently, also in
the rules and procedures of the different colonial
legislatures.
The cardinal principle governing
Parliament’s treatment of financial measures was that they be given the
fullest possible consideration in committee and in the House. This was to ensure
that “parliament may not, by sudden and hasty votes, incur any expenses,
or be induced to approve of measures, which may entail heavy and lasting
burthens upon the
country”. [47]
To
satisfy the requirement for debate, the 1867 rules required that financial
business be considered first in a Committee of the Whole before being debated in
the House. [48]
In
1874, the House agreed to appoint, henceforth, at the beginning of each session,
a Committee of Supply and a Committee of Ways and
Means. [49]
The
Committee of Supply approved the annual Estimates of government expenditure,
while the Committee of Ways and Means considered the government’s
proposals to raise revenue and approved necessary withdrawals from the
Consolidated Revenue Fund for the measures in the Estimates. Yet another measure
safeguarding the House from hasty financial decisions was the rule that the
debate on any motion proposed “for any public Aid or Charge upon the
people” would not proceed immediately, but would be adjourned to a
subsequent sitting
day. [50]
This was done
so that “no member may be forced to come to a hasty decision, but that
every one may have abundant opportunities afforded him of stating his reasons
for supporting or opposing the proposed
grant”. [51]
The first Standing Orders also included,
directly under the heading “Aid and Supply”, a note in reference to
the Constitution Act, 1867, which required that any measure seeking to
raise or spend public money be initiated by the Crown. The rules provided
further that all legislation respecting charges upon the public revenue
(expenditure) or on the public (taxation) be introduced first in the House of
Commons, that is, the Commons alone grants
supply. [52]
In general, the financial procedures set
out under these rules remained the same for the next hundred
years. [53]
However,
financial procedures came to be used by successive oppositions as a means of
obstructing, delaying, and even preventing the government from passing financial
business. As a consequence, beginning in the late 1960s, financial procedures,
which had remained virtually unchanged for a century, were drastically revised
and streamlined. These revisions had to recognize and protect two contradictory
principles: that the government is entitled to get its financial legislation
through Parliament; and that the opposition is entitled to identify, draw
attention to, delay, and debate, items that it feels need attention and
discussion.
The Royal Recommendation
Under the Canadian system of government,
the Crown alone initiates all public expenditure and Parliament may only
authorize spending which has been recommended by the Governor
General. [54]
This
prerogative, referred to as the “financial initiative of the Crown”,
is the basis essential to the system of responsible government and is signified
by way of the “royal recommendation”. With this prerogative, the
government is assigned the responsibility for preparing a comprehensive budget,
proposing how funds shall be spent, and actually handling the use of funds. The
Constitution Act, 1867, states that “It shall not be lawful for the
House of Commons to adopt or pass any Vote, Resolution, Address, or Bill for the
Appropriation of any Part of the Public Revenue, or of any Tax or Impost, to any
Purpose that has not been first recommended to that House by Message of the
Governor General in the Session in which such Vote, Resolution, Address, or Bill
is
proposed”. [55]
The language of the Constitution is echoed in the Standing Orders of the
House. [56]
For the first hundred years following
Confederation, any bill or clause appropriating money had to be preceded by a
House resolution, whose wording defined precisely the amount and purpose of any
appropriations sought. The resolution was moved by a Minister of the Crown and
was recommended by the Governor
General. [57]
Every
appropriating clause of the subsequent bill had to conform to the provisions
outlined in the resolution, and no Member could move amendments to the
legislation that would have the effect of increasing the amount or altering the
purposes which the resolution had
authorized. [58]
To
alter an appropriating clause, the government had first to obtain a new
resolution from the House, again recommended by the Governor General, embodying
the change.
Because the debate on the financial
resolution was often repeated at the second reading stage of the bill, the House
eliminated the resolution stage in
1968. [59]
The
Crown’s recommendation would now be conveyed to the House as a printed
notice which would appear in the Notice Paper and again in the
Journals when the bill was introduced, and be printed in or appended to
the text of the
bill. [60]
The rule
change did not alter the constitutional requirement for a royal recommendation,
nor its form, only the procedure to be followed.
In 1994, the Standing Orders were again
amended to remove the requirement that a royal recommendation had to be provided
to the House before a bill could be
introduced. [61]
The
royal recommendation can now be provided after the bill has been introduced in
the House, as long as it is done before the bill is read a third time and
passed. However, the government has maintained the practice of providing the
royal recommendation to their own bills at the moment they are put on notice for
introduction in the
House. [62]
The royal
recommendation accompanying a bill must still be printed in the Notice
Paper, printed in or annexed to the bill and recorded in the
Journals.
In general, there are two types of bills
which confer parliamentary authority to spend and therefore would require a
royal
recommendation [63] :
- Appropriation acts, or supply bills
which authorize charges against the Consolidated Revenue Fund up to the amounts
approved in the Estimates; and
- Bills which authorize new charges
for purposes not anticipated in the
Estimates. [64]
The
charge imposed by the legislation must be “new and distinct”; in
other words, not covered elsewhere by some more general
authorization. [65]
An appropriation accompanied by a royal
recommendation, though it can be reduced, can neither be increased nor
redirected without a new
recommendation. [66]
Because financial legislation must originate in the House of Commons, bills that
require a royal recommendation may not be introduced in the
Senate. [67]
A royal recommendation not only fixes the
allowable charge, but also its objects, purposes, conditions and qualifications.
An amendment which either increases the amount of an appropriation, or extends
its objects, purposes, conditions and qualifications is inadmissible on the
grounds that it infringes on the Crown’s financial
initiative. [68]
However, a royal recommendation is not required for an amendment whose effect is
to reduce taxes otherwise
payable. [69]
The rules regarding the royal
recommendation also apply to a bill sponsored by a private
Member. [70]
In the
past, when such a bill infringed on the financial initiative of the Crown, the
Speaker has not allowed it to go
forward. [71]
However,
since the rule change of 1994, private Members’ bills involving the
spending of public money have been allowed to be introduced and to proceed
through the legislative process, on the assumption that a royal recommendation
would be submitted by a Minister of the Crown before the bill was to be read a
third time and
passed. [72]
If a royal
recommendation were not produced by the time the House was ready to decide on
the motion for third reading of the bill, the Speaker would have to stop the
proceedings and rule the bill out of order. The Speaker has the duty and
responsibility to ensure that the Standing Orders on the royal recommendation as
well as the constitutional requirements are upheld. There is no provision under
the rules of financial procedure which would permit the Speaker to leave it to
the House to decide or to allow the House to do so by unanimous
consent. [73]
The Commons’ Claim to Predominance in Financial Matters
The Constitution and the Standing Orders of
the House of Commons require that bills which appropriate (impose a charge on
the public revenue) or levy any tax or duty (impose a charge upon the people)
must first be introduced and passed in the House of
Commons. [74]
The
Speaker has ruled that a Senate bill which appropriated public money could not
be introduced in the House and directed that the notice for the first reading of
the bill be removed from the Order
Paper. [75]
The
Speaker has also ruled that a Senate bill which had been read a first time in
the House was in fact imposing a tax and should have originated in the Commons;
the proceedings on the bill were declared null and void and the bill was ordered
withdrawn from the Order
Paper. [76]
Financial legislation is, in the opinion of
the House, not alterable by the
Senate. [77]
Since
Confederation, the Senate has regularly asserted the right to amend money
bills. [78]
Most of the
disagreements between the two Chambers arise over the extent of the
Senate’s authority to amend financial legislation. On the one hand, it has
been argued that the Senate is restricted to passing or rejecting such
bills. [79]
Others
maintain that the Senate has full powers to amend, provided that it not increase
appropriations or the amount of
taxation. [80]
The
issue is whether a money bill is one that includes any financial provisions or
whether its purpose must be primarily or solely financial; and, consequently,
whether any restrictions on the Senate’s power to amend should extend to
the whole bill or simply to its financial aspects. A further question is whether
or not the Senate can propose amendments to bills amending existing financial
legislation. [81]
In
some instances, the House of Commons has rejected the Senate’s amendments
and claimed their financial
privilege. [82]
On
other occasions, however, the House has waived its privileges and accepted the
Senate amendments. [83]
Where the Commons choose to accept a Senate amendment (to a bill appropriating
funds or imposing a tax), they usually waive their financial prerogative, while
insisting that their decision in this instance does not constitute a
precedent. [84]
However, the House has, on occasion, accepted or rejected amendments with no
reference made to its privileges,
whatsoever. [85]
On at
least two occasions, the Speaker has refused to lay aside Senate amendments to
financial legislation, maintaining that it is the responsibility of the Commons,
not the Chair, to invoke or waive the privileges claimed by the
House. [86]
Although
the Chair has acknowledged its responsibility for directing the House’s
attention to any Senate bill or amendment which breaches its
privileges, [87]
the
Speaker does not rule on the right of the Senate to amend financial legislation
on the grounds that this is a constitutional
issue. [88]
Senate
bills, on the other hand, have been laid aside on the grounds that they
contravened the constitutional principles that financial bills originate in the
Commons and are introduced at the initiative of the
Crown. [89]
The House will allow the Senate to include
or alter pecuniary penalties in bills, where such penalties seek only to punish
or prevent crimes or offences and do not have the effect of incurring a public
expenditure or imposing a tax on the
people. [90]