House of CommonsShort guide to procedure and practice

Financial procedures

It is a commonplace that the House no longer in practice exercises significant control over government expenditure, since most of the estimates are agreed to without amendment or debate. However, there are still occasions when it modifies the Government's tax plans. Also, select committees have played an increasing role in monitoring expenditure, examining departments' annual reports and putting forward individual estimates for debate on the floor of the House.

A fundamental principle is that money is voted only on the initiative of the Government. Thus the Commons could reduce estimates but not increase them.

The House's financial procedures can be summarised as follows:

The Budget includes a summary of the main tax and spending proposals, and is followed by five days of debate, ending with votes on resolutions concerning taxes and on the expenditure plans. Tax changes, but not new taxes, may come into effect immediately and be validated by a single motion taken after the Budget speech; they need to be confirmed by individual resolutions within ten sitting days. Papers published at the time of the Budget include the Financial Statement and Budget Report ('the red book').

The Finance Bill is brought in to give permanent effect to the resolutions, which are time-limited. Procedure is as for any public bill, but the bill is usually split for committee stage: a selection of the more controversial, important or novel clauses is considered in Committee of the whole House; the remainder of the bill is considered in standing committee. All proceedings on the Finance Bill are 'exempted business', which means they may continue until any hour.

Each government department publishes detailed expenditure plans for the ensuing three years in about March (forming part of the department's 'annual report').

The Main Supply Estimates are published by each department in about March (in some cases within the department's annual report). There are also supplementary estimates (usually three times a year) and a Vote on Account to authorise a provisional allocation for the forthcoming financial year. There may also be Excess Votes after the financial year ends. The questions on estimates are put formally, without debate, except that three days per session are available to consider estimates proposed for debate by select committees.

Consolidated Fund Bills give legislative force to the Estimates and Vote on Account, including a Consolidated Fund (Appropriation) Bill which appropriates the sums granted to particular purposes. Questions on these bills are put forthwith, without debate.

The Treasury Committee reports annually on the Budget. The Public Accounts Committee reports on value for money in government expenditure, basing its work on the reports prepared by the National Audit Office.

Contact: Clerk of Supply, Public Bill Office, 3253.

Further information: Factsheets No. 18, 'Supply procedure of the House of Commons' and No. 49, 'The House of Commons and the raising of taxation - budgets and financial documents'.


© Parliamentary copyright 2001
Prepared 14 February 2001