Approval of the Estimates (Main or Supplementary) comes first in the form of a Supply resolution. However, such resolutions have political force, but they are not law. Consequently, legislation is also required - in the form of a Supply and Appropriation Bill - before the departmental expenditure set out in the Estimates is legally authorised by Parliament.
When a Supply motion is agreed, it becomes a Supply resolution; it means that the House of Commons has considered the Government's spending plans and expressed support for them.
However, Supply resolutions are political not legal instruments. Legislation is also required before the departmental expenditure set out in the Estimates is legally authorised by Parliament.
This legislation takes the form of:
a Supply and Appropriation (Main Estimates) Act (for the Main Estimates); and
a Supply and Appropriation (Anticipation and Adjustments) Act (for the Supplementary Estimates and Vote on Account).
Supply motions can take two forms.
These are debated on Estimates Days on the recommendation of the Backbench Business Committee and Liaison Committee. The motions are usually tabled between one and four days after the proposals for Estimates Day debates have been approved by the House.
These provide for parliamentary approval of the other departmental Estimates (i.e. those which are not chosen for debate on Estimates Days).
MPs may propose a reduction in an Estimate selected for debate, via an amendment to a Supply motion of type 1 above. However, MPs cannot propose an increase in the Estimate. Only a Government minister may move a Supply motion, and the Government establishes the upper limit on spending, so any amendment to increase that limit is prohibited. This reflects the constitutional principle that only the Crown may initiate expenditure.
Because the Supply motions provide the foundation for subsequent legislation (which is subject to neither debate nor amendment) the form and content of the motions (and of any proposed amendments to them) are strictly policed. Once the motions are agreed as resolutions, they:
must provide a clear legal basis for action;
cannot cover matters unrelated to the Estimates;
cannot include statements of opinion; and
should not impose conditions on the authorisation of expenditure.
The approval of the Estimates must be clear and unambiguous, in relation to both the amounts involved and the purposes for which the spending is designated. Any amendment to the Estimates motions which does not meet these requirements will be deemed disorderly and is therefore unlikely to be selected. (The Speaker of the House of Commons does not have to set out reasons for his decisions on the selection of amendments.)
If the Government were to lose a vote on the Estimates, this would have political, but not necessarily constitutional, implications and consequences.
The Government can request approval of expenditure at any time. However, if approval of the Main Estimates is not sought before 5 August each year, then the Government cannot benefit from the abbreviated procedure set out in Standing Order No. 54 which enables all the Estimates to be approved in a single 'roll-up' motion. If approval is not sought before 5 August each departmental Estimate has to be approved separately. In practice, the 5 August deadline could be altered if MPs wished. A motion could be moved, for example, to amend the Standing Order and substitute a date other than 5 August for consideration of the Estimates in any given year. A motion could also amend the Standing Order provisions requiring the Speaker to put the questions 'forthwith'.
Such an approach has never been tested. MPs would have to weigh the political advantages of doing so against the risks involved in potentially withholding funding for critical economic and social programmes of benefit to their constituents. If MPs declined to approve the Main Estimates by August, then by early Autumn the government would likely run out of money, having used up the 45% advance funding secured through the earlier Vote on Account, and having exhausted all options to redeploy funds from other sources such as the Contingencies Fund or the National Insurance Fund.
The Supply motions, if approved, become resolutions of the House. These resolutions are the parliamentary foundation for:
the Supply and Appropriation (Main Estimates) Bill, which – when passed – provides formal statutory authority for the Main Estimates;
the Supply and Appropriation (Anticipation and Adjustments) Bill, which – when passed – provides formal statutory authority for the Supplementary Estimates and the Vote on Account.
Only once a Bill receives Royal Assent does the spending set out in the Estimates, and approved by Parliament, have legal effect. A Supply and Appropriation Bill is usually introduced by the Chief Secretary to the Treasury once the House has resolved to support the Supply motions. The Bill is usually introduced immediately after the Supply motions are agreed, with Second Reading set for the following sitting day.
As the House has already agreed the Supply resolutions, a Supply and Appropriation Bill is not subject to debate or amendment at any stage. There is no Committee stage, and thus no Report stage, and under Standing Order No. 56 the questions on Second and Third Reading are put 'forthwith'. The Bill is certified as a Money Bill by the Speaker and goes to the House of Lords, where it is passed unamended (in accordance with the Parliament Act 1911). Once the Bill receives Royal Assent, the Government has the legislative approval necessary for the monies sought by each department to be released from the Consolidated Fund. Once enacted, the Supply and Appropriation (Main Estimates) Act and the Supply and Appropriation (Anticipation and Adjustments) Act provides the basis on which the National Audit Office will audit the Government’s accounts.
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