August 22, 2022

Horse 3054 - Constitutional Survey - V(ii)

As previously hinted at, the Australian Constitution was argued over and invented with the experience of Westminster Parliaments and the lessons learned from the United States, Switzerland and Canada, to inform the news course of Federalism. Particularly the bad example of the United States' Constitution, helped to inform the following four Sections.

The United States' Constitution does not have any provisions which relate to the tacking on of monetary appropriations to other pieces of legislation; so this means that this is abused to the point where the US Treasury needs to hire extra coopers just to keep up with all of the pork barrels that need to be made.

As before, I will be referring to this:

https://www.aph.gov.au/About_Parliament/Senate/Powers_practice_n_procedures/Constitution/chapter1/Part_V_-_Powers_of_the_Parliament

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53. Powers of the Houses in respect of legislation

Proposed laws appropriating revenue or moneys, or imposing taxation, shall not originate in the Senate. But a proposed law shall not be taken to appropriate revenue or moneys, or to impose taxation, by reason only of its containing provisions for the imposition or appropriation of fines or other pecuniary penalties, or for the demand or payment or appropriation of fees for licences, or fees for services under the proposed law.

The Senate may not amend proposed laws imposing taxation, or proposed laws appropriating revenue or moneys for the ordinary annual services of the Government.

The Senate may not amend any proposed law so as to increase any proposed charge or burden on the people.

The Senate may at any stage return to the House of Representatives any proposed law which the Senate may not amend, requesting, by message, the omission or amendment of any items or provisions therein. And the House of Representatives may, if it thinks fit, make any of such omissions or amendments, with or without modifications.

Except as provided in this section, the Senate shall have equal power with the House of Representatives in respect of all proposed laws.

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53a - Section 53 is the section which basically confines the Treasurer and the handing down of the Budget (that is, the Appropriation Bills) to the House of Representatives.

At bare minimum, for any given calendar year of legislation, the Parliament should at least try and pass Appropriation Bill No.1 for the financial year of 1 July - 30 June. Usually this is handed down in May to enable the passage of the Appropriation Bills before 1 July.

Sections 51 and 52 stipulate what the Federal Parliament has the power to make laws with for the peace, order, and good government of the Commonwealth with respect to a bunch of things. Section 53 says what the Federal Parliament intends to buy as far as the collective purchasing arrangement we call the Commonwealth goes and how the Federal Parliament intends to pay for it all.

At this point I expect to hear great howls of argument from the Keynesians, the Hayekians, the Friedmanians, the Pikettirati and the MMT Crowd about what they all think the definition of taxation is and what it does. 

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53b and 53c - The Senate can argue all it likes about the Appropriation Bills but it is not allowed to amend those pieces of legislation. 

The United States Senate does have the ability to amend the Twelve Appropriations Subcommittees Bills which make up the US Budget but as Australia had states which were (still are) deeply distrustful of each other, the framers of the Australian Constitution sought to cut this ability to the stump while they could.

The received thought of the day as taken from the United Kingdom's House of Lords was that the Lords should not amend money bills because it was the House of Commons who owned the right to decide what monetary funds that the Monarch could draw upon. 

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53d - Just like the conventions which existed in New South Wales and Victoria, and which were inherited from eth House of Lords, the prevailing custom of the day was that although upper houses did not assume the right to  amend money bills, they had the right to reject the out of hand and/or send the back to the lower houses.

This particular clause will become important in later posts in this series; so be warned.

The United Kingdom which has an unwritten constitution, had to deal with this problem after the creation of the Commonwealth of Australia. The Parliament Act (1911) is the end result of the House of Lords' rejection of the so-called "People's Budget" of 1909 which was handed down by PM David Lloyd George. The Commons accused the Lords of a "a breach of the constitution and a usurpation of the rights of the Commons" and when you add in the complications of the Irish Question and the ongoing Conservative/Liberal bunfight which was still raging, this very quickly got out of hand.

The Parliament Act (1911) basically denied the right of the House of Lords to veto money bills, and hamstrung its right to veto other public bills by handing them a poxy ability to stall for time for a maximum of two years. 

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53e - In November 1992, the then Prime Minister Paul Keating described the Senate as "unrepresentative swill". It probably goes without saying that had the Senate been more amenable to his wished, that he would have never have made this comment because practically nobody objects to something they benefit from.

As the house of review, which was from the outset designed to dilute the power of population by tempering it with the premise that all of the states were at the outset equal, I like that the Senate is in the eyes of some, absurdly powerful even if if has given us racists, nitwits, nutbags, rotter, ne-er-do-wells, charlatans and knaves. That actually is truly representative of who we are as a nation.

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54. Appropriation Bills

The proposed law which appropriates revenue or moneys for the ordinary annual services of the Government shall deal only with such appropriation.

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Here it is. This is the anti-pork barrel piece of the Australian Constitution which attempts to stop coupons being attached to other pieces of legislation. Appropriations can only dealt with in Appropriation Bills. An MP can not attach spending to another bill to buy the votes of some other MP. Horse Trading if it is going to happen, at least where monies are concerned, has to be done within the scope of money bills. 

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55. Tax Bill

Laws imposing taxation shall deal only with the imposition of taxation, and any provision therein dealing with any other matter shall be of no effect.

Laws imposing taxation, except laws imposing duties of customs or of excise, shall deal with one subject of taxation only; but laws imposing duties of customs shall deal with duties of customs only, and laws imposing duties of excise shall deal with duties of excise only.

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Likewise, a government which is short of monies can not sneakily attach hidden taxation into other pieces of legislation. Perhaps the most significant pieces of legislation in my lifetime (being the Income Tax Assessment Act (1997) and the A New Tax System (Goods and Services Tax) Act (1999)) had very intense debate in both chambers; which were different to the regular kind of argument which usually accompanies the Budget bills. 

We had a fantastic bunfight when it came to the GST, where the Senate openly stated that they would refuse to pass certain sections of the Goods and Services Tax Bill unless the House made amendments (because the Senate could not). We had arguments over whether or not the GST should apply to food, to cooked food, whether or not coleslaw was a cooked food or not and what happens if uncooked food was exempt from GST. It was going to be a nightmare on Cooked Chicken Street.

"If you exclude food from GST, you are going to have tax inspectors running around trying to see whether the chocolate on a gingerbread man is bigger than the eyes, trying to determine whether it is food or a snack. You are going to have tax inspectors putting thermometers into pies to see whether they are fresh or takeaway. The government is supported by the economists, international experience, the Commissioner of Taxation and, of course, the Australian people, as expressed in their votes at the last federal election."

- Treasurer Peter Costello, 30th Mar 1999, House of Representatives (Hansard, p 4656)

I quite like the idea of being a tax inspector who gets to put thermometers into pies to see whether they are fresh or takeaway. 

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56. Recommendation of money votes

A vote, resolution, or proposed law for the appropriation of revenue or moneys shall not be passed unless the purpose of the appropriation has in the same session been recommended by message of the Governor-General to the House in which the proposal originated.

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I assume that this is supposed to reinforce the idea that it is the government of the day who gets to initiate appropriations in the House.

These "messages" that the appropriation bills are to be passed, is almost always Gazetted long before Budget Night and exists mostly as a legal formality. This is Executive Government actively displaying its authority at law, of not only control of the House of Representatives but of the Appropriation Bills themselves.

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