I move that the Bill be now read a Second Time.
The principal object of this Bill is to secure a more rational and effective use of the time devoted to parliamentary financial business.
It will, perhaps, be as well if, at the outset, I deal briefly with the present procedure for the consideration of financial business in this House. The annual parliamentary financial cycle begins in February or early March with the debate on the Vote on Account which takes place in advance of the publication of the Estimates Volume and covers many aspects of Government financial policy. This Vote provides approximately one-third of the amount required to run the public services during the succeeding financial year and thus enables these services to be maintained while the individual Estimates are being considered by the Dail. The annual Central Fund Bill is passed in March. That Bill authorises the Minister for Finance to issue from the Central Fund the amount granted under the Vote on Account. With the introduction of the Budget in April or May a further debate on Government financial policy takes place in which a great deal of the ground covered in the Vote on Account debate is again traversed. The Budget is followed by the Finance Bill which gives statutory authority to the taxation proposals announced in the Budget and affords a further opportunity to discuss financial policy. Meanwhile the individual Estimates are considered by the Dail and, as the amount provided in the Vote on Account is only sufficient to cover expenditure for the first four months of the financial year, the Dail must deal with all the Estimates by the end of July at which time the Appropriation Bill, which provides statutory authority for the Estimates, is introduced and passed.
The present arrangements which I have just outlined may be criticised on two grounds. First is the fact that there are, in effect, three major discussions of Government financial policy within a space of about four months— namely on the Vote on Account, the Budget and the Finance Bill. This inevitably produces a certain amount of overlapping between the debates. Of the three, the Vote on Account discussion is the least effective. It takes place, as I have said, in February or early March before all the information required for a comprehensive and informed debate is available. This information, comprising details of Government expenditure and taxation proposals together with the general statistics regarding the state of the economy, is contained in the Estimates Volume, the Budget proposals and the various publications issued at Budget time. It is clear, therefore, that a fully effective debate on Government financial policy cannot take place before the Budget is presented.
The second disadvantage of the present system is that the Dail must dispose of all the Estimates by the end of July. This can cause acute pressure of financial business in the summer session, because the Finance Bill must be enacted by the beginning of August; there have been complaints that the time available for discussing that Bill is unduly restricted. In practice, there is usually a great rush to clear the Estimates in time. This is clearly an undesirable state of affairs and the position is, of course, aggravated if major non-financial legislation is before the House at the same time.
The present Bill is designed to improve that situation. In the first place, it will no longer be necessary to introduce a Vote on Account in February or March. This will mean that more parliamentary time can be devoted to the discussion of other business, including Estimates if so desired. Furthermore, by increasing the amount which may be issued from the Central Fund before the passing of Estimates by the Dail, the Bill will provide sufficient funds to enable the supply services to be maintained until about December. Thus, the consideration of Estimates can be extended into the autumn session; the pressure of business in the summer session will be eased and more time will be available for discussion of the Estimates. The Appropriation Bill will be introduced, as hitherto, after all the Estimates have been considered by the Dáil.
In lieu of the annual Vote on Account and Central Fund Bill, it is now proposed in section 2 of the present Bill that the Minister for Finance be authorised to issue from the Central Fund, in any year from 1966/67 onwards, an amount not exceeding four-fifths of the amount appropriated for each particular service in the preceding financial year. Section 3 of the Bill provides for the adjustment of this four-fifths provision according as individual Estimates are passed by the Dail. Thus, if the amount of an Estimate exceeds four-fifths of the amount appropriated for the same service in the preceding year, the amount authorised to be issued under section 2 of the Bill will be increased by the amount of the excess when the particular Estimate is passed by the Dail. Similarly, if an Estimate is less than four-fifths of the previous year's appropriation, the issues authorised under section 2 will be reduced.
Section 4 is designed to cover issues in respect of new services which were not included in the Appropriation Act of the preceding year, together with existing services for which the Estimates were passed by the Dail before the commencement of the financial year to which they relate. These latter would be Estimates which were passed by the Dail in accordance with the revised procedure introduced in 1964, whereby selected Estimates may be taken before the Estimates Volume is published.
Section 5 of the Bill provides that, in March of each year, the Minister for Finance will lay before the Dail a statement of the amounts he will be authorised to issue in the following financial year under Sections 2 and 4 of the Bill. This statement will be in substitution for the present Vote on Account White Paper.
Section 6 gives the Minister the borrowing powers hitherto granted each year in the annual Central Fund Act. Section 7 provides that, for the purpose of determining the amount the Minister is authorised to borrow under any Act, amounts which have been repaid within 12 months after the date on which they were borrowed shall be disregarded. The need for this arises from the fact that some short-term borrowing takes the form of Exchequer Bills which are repaid and renewed every three months. At present such borrowings are regarded as cumulative and the statutory limit could be reached merely because they are renewed.
This Bill is designed to facilitate the Dail in dealing with financial business. It will not involve any lessening of Parliamentary control over public expenditure. Dail approval of Estimates will still be required under section 2 of the Bill which stipulates that issues are subject to the proviso that, during the year, the Minister for Finance will ask Dail Eireann to grant supply for that service in respect of the year. Furthermore, the Bill will preserve the existing rule that expenditure on a new service cannot be incurred until the Dail has approved that service.
I commend this Bill to the House as a worthwhile attempt to secure more informed and effective discussion of Government financial policy.
