Magazine article Public Finance

Back to Budget Basics

Magazine article Public Finance

Back to Budget Basics

Article excerpt

The Scottish Parliament is still coming to terms with minority government, but already there are signs of an emerging conflict over the budget.

The current process was designed to promote more extensive consultation between the Executive and Parliament over spending priorities in the context of a parliamentary majority. It permits committees to make recommendations to reallocate expenditure within budget limits.

Devolution has delivered a much greater degree of parliamentary scrutiny of the Scottish budget.

Most recommendations for reallocation have had cross-party support, and most have been accepted by the Executive. So the finance committee's power to propose an alternative budget if dissatisfied with the Executive's response to its budget report has not been used.

The final stage of the process is the enhancement of the Budget Bill in January, when only a member of the Executive may move amendments. Parliament votes to accept or reject the whole Bill and, so far, has voted for approval. If it is rejected, business continues on the basis of the current budget allocation.

This is, therefore, a very crude mechanism of parliamentary control, and both Labour and the Liberal Democrats have argued for the arrangement to be modified to convert recommendations into budget amendments. There is a strong democratic case for such a reform in principle, so that the differences in priorities between the parties can be transparent.

In the context of a minority administration, the case is even stronger, as the Executive's ability to reject parliamentary votes to alter the budget would be profoundly undemocratic. The will of Parliament should prevail, and this proposal would strengthen parliamentary control of expenditure.

The minority administration of the Scottish National Party, unsurprisingly, sees no need to change, despite its rhetoric about compromise and consensus.

More surprising is the rejection of the proposal by the Conservatives, in favour of a more extensive review. The problem with this approach is that Parliament will be asked to approve three-year spending plans in the autumn. There is a real possibility that budgets will be passed with only minority support.

The Conservative finance spokesman Derek Brownlee attacked the reform proposals as being driven by a concern for partisan advantage by the former coalition partners, and favoured a more comprehensive review, focused on value for money.

The Conservative position is itself a partisan one. …

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