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Fiscal Responsibility Bill


Fiscal Responsibility Bill

1

 

A

Bill

To

Make provision for and in connection with the imposition of duties for

securing sound public finances. 

Be it enacted by the Queen’s most Excellent Majesty, by and with the advice and

consent of the Lords Spiritual and Temporal, and Commons, in this present

Parliament assembled, and by the authority of the same, as follows:—

1       

Initial duties

(1)   

The Treasury must ensure that, for each of the financial years ending in 2011 to

2016, public sector net borrowing expressed as a percentage of gross domestic

product is less than it was for the preceding financial year.

(2)   

The Treasury must ensure that, for the financial year ending in 2014, public

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sector net borrowing expressed as a percentage of gross domestic product is no

more than half of what it was for the financial year ending in 2010.

(3)   

The Treasury must ensure that—

(a)   

public sector net debt as at the end of the financial year ending in 2016

expressed as a percentage of gross domestic product (centred on 31

10

March 2016), is less than

(b)   

public sector net debt as at the end of the previous financial year

expressed as a percentage of gross domestic product (centred on 31

March 2015).

2       

Further duties for securing sound public finances

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(1)   

The Treasury may make an order imposing on the Treasury a duty or duties

framed by reference to any one or more of the financial years ending in 2011 to

2016.

(2)   

The Treasury must—

(a)   

no later than 31 March 2016 make an order imposing on the Treasury a

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duty or duties framed by reference to a financial year or financial years

ending after that date and specified in the order, and

(b)   

no later than each relevant date, make an order imposing on the

Treasury a duty or duties framed by reference to a financial year or

financial years ending after that relevant date and so specified.

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Fiscal Responsibility Bill

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(3)   

For the purposes of paragraph (b) of subsection (2) the following are relevant

dates—

(a)   

the last day of the financial year, or the latest financial year, specified in

the order under paragraph (a) of that subsection, and

(b)   

the last day of the financial year, or the latest financial year, specified in

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an order made under paragraph (b) of that subsection.

(4)   

A duty imposed by an order under this section must be one imposed for the

purpose of securing sound public finances.

(5)   

A duty imposed by an order under this section may be—

(a)   

a duty similar to any of the duties in section 1, or

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(b)   

any other general duty relating to fiscal policy which the Treasury

consider appropriate.

(6)   

A duty imposed by an order under this section must be consistent with the key

principles as applied by the code for fiscal stability.

(7)   

An order under this section is to be made by statutory instrument.

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(8)   

No order may be made under this section unless a draft of the statutory

instrument containing it has been laid before Parliament and approved by a

resolution of the House of Commons.

3       

Progress and compliance reports

(1)   

The Treasury must make a report on the progress which has been made

20

towards complying with the duty in section 1(1) in respect of a financial year

whenever—

(a)   

an Economic and Fiscal Strategy Report, or

(b)   

a Pre-Budget Report,

   

is laid before Parliament during the financial year.

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(2)   

The Treasury must, on the first occasion on which a Pre-Budget Report is laid

before Parliament after the end of a financial year in respect of which the duty

in section 1(1) applies, make a report stating whether or not it appears to them

at that time that the duty relating to that financial year was complied with and,

if not, why not.

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(3)   

The Treasury must make a report on the progress which has been made

towards complying with the duty in section 1(2) whenever—

(a)   

an Economic and Fiscal Strategy Report, or

(b)   

a Pre-Budget Report,

   

is laid before Parliament before 1 April 2014.

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(4)   

The Treasury must, on the first occasion on which a Pre-Budget Report is laid

before Parliament after 31 March 2014, make a report stating whether or not it

appears to them at that time that the duty in section 1(2) was complied with

and, if not, why not.

(5)   

The Treasury must make a report on the progress which has been made

40

towards complying with the duty in section 1(3) whenever—

(a)   

an Economic and Fiscal Strategy Report, or

(b)   

a Pre-Budget Report,

   

is laid before Parliament during the financial year ending with 31 March 2016.

 
 

Fiscal Responsibility Bill

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(6)   

The Treasury must, on the first occasion on which a Pre-Budget Report is laid

before Parliament after 31 March 2016, make a report stating whether or not it

appears to them at that time that the duty in section 1(3) was complied with

and, if not, why not.

(7)   

An order under section 2 must include provision requiring the Treasury to

5

make—

(a)   

progress reports, and

(b)   

a report as to compliance,

   

in relation to the duty or duties imposed by the order.

(8)   

The code for fiscal stability may make provision about the content and form of

10

reports made under or by virtue of this section.

4       

Accountability to Parliament

(1)   

Each report made under or by virtue of section 3 must be laid before

Parliament.

(2)   

The only means of securing accountability in relation to—

15

(a)   

the duties in section 1, and

(b)   

duties imposed by orders under section 2,

   

is that established by the provision made by or under section 3 for the making

of progress reports and reports as to compliance and the duty imposed by

subsection (1).

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(3)   

Accordingly, the fact that—

(a)   

any duty in section 1, or

(b)   

any duty imposed by an order under section 2,

   

has not been, or will or may not be, complied with does not affect the

lawfulness of anything done, or omitted to be done, by any person.

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5       

Interpretation

(1)   

The code for fiscal stability—

(a)   

must explain the meaning of the expressions “public sector net

borrowing”, “gross domestic product”, “public sector net debt” and

“gross domestic product (centred on a date)” used in section 1 for so

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long as is required for the purposes of this Act, and

(b)   

may explain the meaning of expressions used in an order under section

2.

(2)   

In this Act—

“the code for fiscal stability” means the code under section 155 of the

35

Finance Act 1998,

“an Economic and Fiscal Strategy Report” means an Economic and Fiscal

Strategy Report prepared under section 156(1)(b) of that Act,

“the key principles” means the principles specified in section 155(2) of that

Act, and

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“a Pre-Budget Report” means a Pre-Budget Report prepared under

section 156(2) of that Act.

 
 

Fiscal Responsibility Bill

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6       

Short title

This Act may be cited as the Fiscal Responsibility Act 2010.

 
 

 
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