Introduction to Financial Procedures
The written rules and parliamentary practices governing the area
of financial procedures ¾ specifically, the business of Supply,
the business of Ways and Means, and the Royal Recommendation ¾
are among the most intricate and difficult aspects of parliamentary
procedure to understand. The roots of these practices are found
deep in British parliamentary history. They involve not only the
process by which the various taxation and appropriation bills, as
well as substantive bills with financial implications are introduced
and passed, but also touch upon the relationships between the Crown,
the House of Commons and the Senate.
The business of Supply is the process by which the government submits
its projected spending plans for parliamentary approval. The process
has two phases: the legislative phase, which involves the estimates
and the necessary appropriation bills, and a general debate phase,
which focuses on opposition Supply motions, the number and disposition
of which is governed by specific Standing Orders.
The business of Ways and Means is the process by which the government
obtains the funds required to meet its expenses. It is in essence
the mechanism by which the government raises taxes, presents national
budgets and thus influences the nation's economy. The Ways and Means
process has two phases: the Budget presentation, in which the Minister
of Finance delivers an economic statement and tables notices of
Ways and Means motions, and the legislative phase, in which a Ways
and Means motion is called and then concurred in as a prerequisite
to the first reading of any tax bill proposing an increased charge
on the taxpayer.
The Royal Recommendation is the instrument by which the Crown advises
Parliament of its intent to introduce a legislative measure having
an impact on the Consolidated Revenue Fund. In Canada, the Crown
alone, acting on the advice of the Cabinet, initiates all public
expenditure and Parliament may only authorize spending that has
been recommended by the Governor General. This prerogative, referred
to as the "financial initiative of the Crown" is the essence
of responsible government.
The Constitution and the Standing Orders of the House of Commons
require that bills that appropriate funds (impose a charge on the
public revenue) or levy any tax (impose a charge upon the people)
must first be introduced in the House.
The Speaker has the duty and responsibility to ensure that proper
procedure is followed throughout the financial cycle and that all
public bills, whether they emanate from the Government in the House,
the Senate or a private Member, respect the financial prerogative
of the Crown. In the case where a bill has infringed on the financial
initiative of the Crown, the Speaker has not allowed it to go forward.
Here is an example of the Speaker's ruling in the matter of Financial
Procedures:
Financial Procedures
Point of Order
Supply - Business of Supply (Estimates) - admissibility
November 22, 2001
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