Increase Powers of Parliament to Scrutinise the Budget

The UK government should be required to publish the annual budget four months in advance of it being laid before parliament, to enable greater public and parliamentary scrutiny of it.

 

In a lecture to the London School of Economics [http://www.lse.ac.uk/publicEvents/events/2015...6t1200vLSE.aspx], the First Minister of Scotland Nicola Sturgeon called for a reform to the way in which the UK government sets the budget and allows for parliamentary scrutiny. As an alternative, she proposed adopting the Scottish system of publishing the draft budget four months before it is laid before parliament.

 

Here is the relevant section of her speech:

 

The rituals of budget day are just one part of that, but they’re an important part. For example, there’s a very specific reason why we traditionally don’t hear about the government’s financial plans, until shortly before the start of the financial year.

 

It dates back to the 17th century. The Crown would ask Parliament for money and Parliament found that it could force the crown to economise  by delaying its approval.

 

Whether this ancient tradition still makes sense today has been questioned for decades. In 1980 the Institute for Fiscal Studies commissioned a report on budgetary reform. It pointed out that the timing of the budget “means that the opportunity for financial appraisal both inside and outside parliament is very limited. In other countries budgets are consistently presented three months or so before they take effect.”

 

The process UK governments follow now, as in 1980, allows virtually no time for proper deliberation or consultation. That problem is made worse by the way in which successive governments have approached the budget.  Chancellors take pride in pulling rabbits out of the hat. Surprises are seen as a virtue. They help to create headlines and wrong-foot the opposition.

 

It’s much more difficult for that to happen in Scotland. The Scottish Government has to publish a detailed draft budget each September, four months before the budget bill is laid before Parliament.

 

Doing anything similar at Westminster would require substantial changes to how budgets are put together – most importantly, perhaps, it would require a different, far more consensual approach. I think that would be very beneficial and, who knows, it could be one of the benefits of a period of minority government following the General Election.

 

You can read a transcript of the full speech on the LSE website [http://www.lse.ac.uk/publicEvents/events/2015...6t1200vLSE.aspx].

 

Further information about the Scottish government’s budget process can be found on the Scottish government website [http://www.gov.scot/Topics/Government/Finance/18127/11754].

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edited on Mar 21, 2015 by Jake Wellman

John Hully Apr 5, 2015

The ritual of Budget Day is also rendered symbolic rather than practical by the separation of Chancellor's speech, and the publication of the budget documents. The former typically does not include all of the latter, and may not accurately describe the contents of the latter. 

It is vital that as much opportunity as possible is allowed for analysis and adjustment of the budget to be made prior to its enactment. The Treasury Select Committee should therefore be bound to report on the proposed budget, and should be able to call public and expert witnesses as well as all heads of government departments to compile a comprehensive statement of benefits, risks, and impacts and to validate all constraints and assumptions in the budget document.

This principle - of pre-legislative scrutiny - which is present in the processes of the Scottish parliament should be extended to all parliamentary committees. The key objective is to transform select committees to actively perform robust governance of all proposed legislative and operational change on behalf of the public, not the government of the day. 

Jake Wellman Apr 16, 2015

What type of constitutional requirement would address this issue?

Perhaps something like the Scottish model:

-"the Chancellor of the Exchequer shall present a proposed budget  for the following year by October 1"

What are your thoughts?

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