Private Members’ Business / Financial Limitations

Replenishment of the order of precedence: Speaker’s statement regarding bills that infringe on the financial prerogative of the Crown

October 31, 2017

Debates, p. 14727–9

On May 9, 2017, the Speaker made a statement regarding Private Members’ Business noting that two House bills added to the order of precedence gave the Chair some concern with regard to recent spending provisions: Bill C-315, an act to amend the Parks Canada Agency Act (Conservation of National Historic Sites Account), standing in the name of Gordon Brown (Leeds—Grenville—Thousand Islands and Rideau Lakes); and Bill C-343, an act to establish the Office of the Federal Ombudsman for Victims of Criminal Acts and to amend certain acts, standing in the name of Sylvie Boucher (Beauport—Côte-de-Beaupré—Île d’Orléans—Charlevoix). On an exceptional basis, the Speaker also raised concerns about two Senate bills: Bill S-205, an act to amend the Canada Border Services Agency Act (Inspector General of the Canada Border Services Agency) and to make consequential amendments to other acts, standing in the name of Julie Dabrusin (Toronto—Danforth); and Bill S-229, an act respecting underground infrastructure safety, standing in the name of Lloyd Longfield (Guelph). The Speaker stated that bills containing spending provisions must originate in the House of Commons, and he expressed specific concerns about the unusual manner in which the Senate bills were structured. He noted that receiving Senate bills that appeared to contain spending provisions and that would therefore require a royal recommendation was exceptional and rare, and he added that if, following the first reading of Bill S-205 and Bill S-229, the Chair determined that they were contrary to the usual rules and practices regarding money bills, they would be removed from the Order Paper. The Speaker encouraged members to present their arguments at the earliest opportunity.^[1]

On May 12, 2017, Kevin Lamoureux (Parliamentary Secretary to the Leader of the Government in the House of Commons) agreed that Bills C-315, C-343, S-205 and S-229 contained provisions that infringed upon the financial prerogative of the Crown as stated in Standing Order 79(1).^[2] On September 19, 2017, John Nater (Perth—Wellington) argued that Bill C-343 would require parliamentary appropriation to be separately enacted and that this would happen only if the necessary appropriation for expenditure was granted by Parliament.^[3]

Resolution

On October 31, 2017, the Speaker delivered his ruling. In the case of Bill C-315, he found that the bill required a royal recommendation but that, consistent with practice for Commons bills, it could continue through the legislative process, since a royal recommendation could be obtained before the final vote on the bill or it could be amended in a way that would obviate the need for a royal recommendation. Regarding Bills C-343, S-205 and S-229, he stated that all three bills explicitly provided that they could not be brought into force until funds were appropriated by a subsequent act of Parliament, initiated in the House of Commons and accompanied by a royal recommendation. He added that, since adoption of the bills did not authorize the appropriation of any funds from the consolidated revenue fund, a royal recommendation was not required. Given that there have been no bills providing for conditional spending since significant changes to Private Members’ Business practices were made in 1994, the Speaker encouraged the Standing Committee on Procedure and House Affairs to consider the matter of private members’ bills containing non-appropriation clauses, as the House would likely welcome the committee’s views on the subject.

Decision of the Chair

The Speaker: I am now prepared to rule on the point of order raised on May 12, 2017, by the hon. member for Winnipeg North concerning the possible requirement for a royal recommendation with respect to four private members’ bills, two from the House of Commons and two from the Senate.

The Commons bills are Bill C-315, an act to amend the Parks Canada Agency Act, conservation of national historic sites account, standing in the name of the hon. member for Leeds—Grenville—Thousand Islands and Rideau Lakes, and Bill C-343, an act to establish the office of the federal ombudsman for victims of criminal acts and to amend certain acts, standing in the name of the hon. member for Beauport—Côte-de-Beaupré—Île d’Orléans—Charlevoix. Both bills are currently in the order of precedence at second reading.

The two Senate bills are Bill S-205, an act to amend the Canada Border Services Agency Act, Inspector General of the Canada Border Services Agency, and to make consequential amendments to other acts, standing in the name of the hon. member for Toronto—Danforth, and Bill S-229, an act respecting underground infrastructure safety, standing in the name of the hon. member for Guelph. Both of these bills are currently awaiting first reading.

Members will recall that on May 9, 2017, I made a statement in which I invited arguments in relation to these four bills. I would like to thank the hon. Parliamentary Secretary to the Leader of the Government in the House of Commons, the hon. member for Guelph, and the hon. member for Perth—Wellington for their detailed interventions.

Of the four bills, Bill C-315, in proposing to establish a separate account as part of the accounts of Canada from which disbursements could be made, raises most clearly a question about the possible need for a royal recommendation. The other three bills, C-343, S-205, and S-229, are different. While they present schemes that could lead to new spending, all contain coming-into-force provisions designed to make such spending conditional on separate parliamentary appropriations. I will address Bill C-315 first, and then the other three.

Bill C-315 establishes a distinct account for the conservation of national historic sites, called the conservation of national historic sites account. The funds for this account are to be raised exclusively through private donations and from the interest generated from them. I should note that this fund seems to be separate from the pre-existing new parks and historic sites account, which serves a similar purpose and is also based, at least in part, on donations.

Bill C-315 also provides that the funds may be spent for specific purposes in relation to national historic sites. The parliamentary secretary contended that the creation of such a new account, and the authority to spend its funds on national historic sites, would be a new and distinct purpose that is not specifically authorized by any statute, thus clearly requiring a royal recommendation.

In making his case, the parliamentary secretary drew a parallel to the employment insurance fund. While nominally its own account, all amounts received and dispersed from the EI fund are deposited in and drawn from the consolidated revenue fund. Because these monies are part of the consolidated revenue fund, a royal recommendation is necessary to authorize any expenditure from it.

Although the situation with Bill C-315 is not entirely analogous to the EI fund, I believe that a similar principle still applies. Even if the monies are accounted for separately and raised exclusively through donations and interest generated from those donations, once collected, they become public funds deposited into the consolidated revenue fund. Any payments from this fund would also be drawn from the CRF. As the bill authorizes this spending for a specified purpose, it must be accompanied by a royal recommendation. Therefore, I find that the objections raised by the parliamentary secretary are well founded.

However, as is consistent with our practice with respect to Commons bills, Bill C-315 can continue through the legislative process as long as there is a possibility that a royal recommendation could be obtained before the final vote on the bill. Alternatively, the bill could perhaps be amended in such a way as to obviate the need for a royal recommendation. Absent one or other of these options being exercised, the question at third reading of the bill will not be put.

Let me now turn to the issues raised in the three other bills, namely S-205, S-229, and C-343. The parliamentary secretary argued that the bills in question were proposing new and distinct expenditures and that the accompanying coming-into-force provisions did not alter this fact. In support of this argument, he cited a Speaker’s ruling from November 9, 1978 about clauses in bills that seek to elude the requirement for a royal recommendation. Accordingly, it was his contention that the question could not be put at third reading on Bill C-343. Moreover, with respect to Bills S-205 and S-229, which originated in the Senate, both should be removed from the Order Paper since any bills appropriating public funds must originate in the House of Commons.

The member for Guelph argued, on June 20, 2017, that Bill S-229 is in order and should be allowed to proceed. First, he contended that no procedural authority exists to remove Bill S-229 from the Order Paper. To do so, the Chair would be relying exclusively on constitutional principles set out in sections 53 and 54 of the Constitution Act, which, in his view, is contrary to the principle that the Chair does not rule on matters of constitutionality. He also contended that even if a royal recommendation were needed, the Chair should allow the bill to continue until the end of the debate at third reading, as is done for private members’ bills first introduced in the House.

The member then turned to more substantive arguments about the bill, claiming that the coming-into-force clause ensured that it did not appropriate any part of the public revenue, as such appropriations would have to be granted through subsequent legislation. He further contended that it was not a “money bill”, but, and I quote, “merely contemplates the minister entering into an agreement but does not directly involve any expenditure”.

The hon. member for Perth—Wellington, on September 19, 2017, made a similar argument in relation to Bill C-344. In his view, it was clear that no money could be spent for the purposes set out in the bill unless and until such funds were appropriated by Parliament in a separate measure. He argued that the bill merely established the machinery under which some future expenditure might be made and that for this reason it did not require a royal recommendation.

As Speaker, I am mindful of my responsibility to provide members with the widest amount of latitude possible in bringing forward measures for consideration as long as these conform to our rules and practices. Their proposals may take the form of either motions or bills. The Chair would only intervene to prevent consideration of such items when they are clearly defective in some procedural way. One of the most important tests when it comes to bills that authorize spending is that they must first be introduced in the House of Commons and must be accompanied by a royal recommendation prior to final adoption. The key question in relation to these three bills is whether they authorize any spending. That is to say, would their adoption result in public funds being appropriated for new and distinct purposes?

The Parliamentary Secretary pointed out measures in each bill that he felt required a royal recommendation. Bill C-343 provides for the appointment of a federal ombudsman for victims of crime, with remuneration and associated expenses for the appointee, and the hiring and remuneration of the necessary staff.

As the member for Perth—Wellington mentioned in passing, this office already exists as a program within the Department of Justice and the ombudsman is appointed as a special advisor to the Minister of Justice pursuant to the Public Service Employment Act. What Bill C-343 proposes, I would argue, is different, insofar as it seeks to establish the ombudsman as a separate and independent office outside of the department. In such circumstances, a royal recommendation would be needed to properly implement the creation of this office and authorize spending to this end.

Bill S-205 proposes the appointment of a new inspector general of the Canada Border Services Agency, the appointee’s remuneration, and associated employment benefits. These provisions, if implemented, would require new and distinct spending not currently covered by existing appropriations.

Bill S-229 seeks to authorize the designated minister to make regulations allowing for, among other things, the establishment of a funding program to enable notification centres and damage-prevention organizations to exercise the functions assigned to them under this act, potentially involving new expenditures not currently authorized. Excepting that certain clauses of each bill seem to involve potential spending for which a royal recommendation would ordinarily be required, the critical question is the impact of the coming-into-force clause.

The hon. member for Guelph and the hon. member for Perth—Wellington cited certain authorities and precedents to justify why a royal recommendation is not required. Beauchesne’s Parliamentary Rules and Forms, sixth edition, at page 186, citation 613 reads:

A bill, which does not involve a direct expenditure but merely confers upon the government a power for the exercise of which public money will have to be voted by Parliament, is not a money bill, and no royal recommendation is necessary as a condition precedent to its introduction.

The same publication, at page 185, citation 611, addresses the issue of Senate bills containing a clause that states that no money will be spent as long as the necessary parliamentary appropriation is not secured. Specifically, it states:

A bill from the Senate, certain clauses of which would necessitate some public expenditure, is in order if it is provided by a clause of the said bill that no such expenditure shall be made unless previously sanctioned by Parliament.

All three bills explicitly provide that they cannot be brought into force until funds are appropriated by a subsequent act of Parliament, which would have to be initiated in the House of Commons and be accompanied by a royal recommendation. The adoption of these bills, then, does not authorize the appropriation of any funds from the consolidated revenue fund. They would establish a framework in law to establish the new offices proposed by Bill C-343 and Bill S-205, or to develop the system proposed by Bill S-229.

However, the crown is in no way obligated to spend money for these purposes. If, in the future, Parliament granted the necessary funds for these purposes, it would be doing so in the full knowledge that it would allow these measures to come into force. Such a granting of funds would have to be done pursuant to our normal financial procedures. This being so, the financial prerogatives of the crown and the privileges of the House of Commons are entirely respected.

It must also be recognized that the House has not had to deal with bills providing for conditional spending in recent years and certainly not since the significant changes to our practices surrounding private members’ business made in 1994.

After careful consideration, I am of the view that a royal recommendation is not required, and that these three bills may continue along the usual legislative process. With that said, I believe it might be useful for the Standing Committee on Procedure and House Affairs to consider the matter of private members’ bills that contain what I would call, for lack of a better term, non-appropriation clauses. The House would likely welcome any views that the committee would have to offer on this subject.

I thank hon. members for their attention.

Post scriptum

On November 1, 2017, Bill C-315 and Bill C-343 were defeated at second reading.^[4]