Financial Procedures / Miscellaneous

July 11, 1988

Debates, pp. 17382-4

On July 8, 1988, the Speaker informed the House that a message had been received from the Senate^[1] indicating that it had divided, into Part 1 and Part II, Bill C-103, An Act to increase opportunity for economic development in Atlantic Canada, to establish the Atlantic Canada Opportunities Agency and Enterprise Cape Breton Corporation and to make consequential and related amendments to other Acts, and that Part I was returned to the House without amendment. The Hon. Doug Lewis (Minister of State and Minister of State (Treasury Board)) then rose on a point of order objecting to the unprecedented action taken by the Senate in dividing the Bill. He argued that the Senate decision to split the Bill meant the Bill no longer possessed the required Royal Recommendation constitutionally necessary for such a "Money" Bill. Thus Standing Order 87 which states that the House of Commons alone can grant aids and supplies had been breached by this action. He then requested guidance from the Chair as to the acceptability of such a message. Mr. Russell MacLellan (Cape Breton—The Sydneys), on behalf of the Official Opposition, argued that the Government had included in the Bill, which was to be primarily for the financing of important regional development projects in Atlantic Canada, a completely separate section to do away with the industrial development division of the Cape Breton Development Corporation. Mr. MacLellan then stated that in his view it was thus perfectly acceptable for the Senate to split the Bill since it was composed of quite distinct parts, each standing as separate and independent legislative proposals. Other Members also intervened on the matter. The Speaker indicated that he would consider the matter very carefully in order to provide the House with some guidance on this matter.^[2] He returned to the House on July 11, 1988 to deliver his decision which is reproduced below.

Decision of the Chair

Mr. Speaker: I want to bring to the attention of honourable Members that on Friday last there was some discussion in this Chamber as to a certain action taken by the other place, and for those uninitiated that means the Honourable the Senate, with respect to a Bill which after having passed in this place was sent to the Senate.

In the interests of honourable Members, but especially in the interests of the public who are watching and listening, I want to just in very simple language explain what happens because I have a technical ruling and it just may be that then public of this country, which ought to understand what we are doing here, will find it easier to follow if I give a brief explanation in layman's language, if I can put it that way.

What happened was simply that a Bill numbered Bill C-103, which is a Bill respecting economic development in Atlantic Canada, was passed by this House in all stages and was sent to the Senate, as is the normal procedure. When it was being considered by the Senate, the Senate decided for whatever reason, to split the Bill, in other words to break it into two parts, and the Senate sent back to this House one part of the Bill. There was much argument in the House Friday as to whether or not this was justified. It is not for the Speaker to say whether or not on any substantive reason there was any logical justification for it.

Essentially, that is the point that the Speaker has been asked to comment upon, that is, whether it is under our system appropriate for the Honourable the Senate to take a Bill that has passed this place and to break it into two parts and send back one-half of the Bill, especially when it is a Money Bill which requires at its very beginning the Royal Recommendation for the expenditure of funds.

As I have said, that is a layman's explanation. It is important that all Canadians understand just exactly what it is the Chair has been asked to do in this particular case. I am now going to get into the formal part of the ruling. I will try not to keep the House too long. I hope that given this explanation it will be clear to everybody just exactly what has happened here and what the response of the Chair is in this ruling and the invitation that the Chair gives to this House as to whatever further response the House may wish to take.

On Friday, July 8 last, the Chair informed the House that a message  had been received from the other place that it had divided Bill C-103, An Act to increase the opportunity for economic development in Atlantic Canada, to establish the Atlantic Canada Opportunities Agency and Enterprise Cape Breton Corporation and to make consequential and related amendments to other Acts. The message from the Senate simply informed this House of its decision and reported back without amendment only Part 1 of Bill C-103.

The honourable Minister of State for the Treasury Board rose on a point of order objecting to the unprecedented action by the Senate in dividing Bill C-103 and requesting guidance from the Chair as to the acceptability of such a message. The honourable Member for Cape Breton—The Sydneys counter-argued that what the Senate had done was quite logical since Bill C-103 was composed of quite distinct parts and could easily be divided into two parts, each standing as separate and independent legislative proposals.

I point out that the honourable Member for Cape Breton—The Sydneys also argued strenuously for the substantive issue that is involved. As I said, that is for others to argue and is not for the Chair to comment upon.

The honourable Member for Churchill (Mr. Rod Murphy), supported vigorously by the honourable Member for Annapolis Valley—Hants (Mr. Pat Nowlan) and the honourable Member for Halifax West (Mr. Howard Crosby), objected to the innovative procedure of the Senate on the grounds that the privileges of this House had been violated. The honourable Member for Churchill claimed that the Senate had no authority to split a Bill originating in the Commons. The honourable Member for Annapolis Valley—Hants further added that if this precedent were to be allowed, the House of Commons would be at risk in seeing much of its legislation originating in an elected Chamber compromised in principle by the Senate's actions.

Before dealing with the essence of the problem, it might be useful to summarize what happened with Bill C-103, the Government Organization Act, Atlantic Canada, 1987.

The House passed Bill C-103 on third reading on May 10, 1988, and sent it to the Senate the same day with a message signed by the Clerk of the House.

Let me say parenthetically that it is unusual to refer to specific proceedings of the other place-again, for those listening, "the other place" is a term used here to mean the Honourable The Senate-in this House. The Chair finds itself obliged to lay that convention aside for clarity's sake in this particular issue.

On June 1, 1988, a motion was moved in the Senate to instruct the Senate Finance Committee to divide Bill C-103. A procedural debate ensued. Having first reserved his decision, the Speaker of the Senate on June 7, 1988, ruled the motion out of order. In other words, the Speaker of the Senate ruled the motion to split a Bill from the House of Commons as out of order. His reasoning which is a matter of record, was based on the fact that Bill C-103 is a Money Bill and that the Senate, while free to split Bills originating in the Senate, as a general principle should not divide Bills originating in the Commons.

Thereupon the ruling of the Speaker of the Senate was appealed to the whole House, that is, to the whole Senate, and was overturned by a majority vote. The motion to split Bill C-103 was moved, proposed, debated and passed. May I also add parenthetically that this House, the House of Commons of Canada, has seen the wisdom of leaving final procedural decisions to its presiding officer and accordingly has long abolished the appeal procedure relating to Speaker's rulings.

Bill C-103 was then studied by the Senate Finance Committee, which split the Bill in two, in accordance with the Senate's instructions. The Committee reported Part 1 of the Bill to the Senate and the Senate sent this part back to the House last Friday. That is where we are today. The House has only one part of Bill C-103.

I must also underline for the House that this procedural event is totally without precedent. I have been unable to find any instance in our practice in which the Senate divided a Commons Bill, or in which the Commons has divided a Senate Bill. There are several cases in which the Speaker of the House of Commons has ruled certain Bills originating in the Senate out of order because they infringe the financial privileges of the House which are enshrined in the Constitution of Canada. I refer honourable Members in this case to Journals of November 12, 1969, and June 12, 1973, for two such examples.^[3]

I refer honourable Members to page 502 of the 20th edition of Erskine May. It concerns a procedural incident in the British Parliament, where there had been an attempt in the House of Lords to split a Bill from the House of Commons, but this attempt failed after a motion to split the Bill was rejected. This incident is reported but the author carefully refrains from indicating how the Lower House could have reacted if the motion had passed. This incident occurred in 1852 and I could find no similar incidents anywhere since then.

A Canadian precedent does exist for a consolidation of two Commons Bills into a single legislative measure by the Senate. That took place on June 11, 1941, with a message from their Honours, from the Senate, asking for the concurrence of this House. The Commons agreed with the Senate proposal, that is, a proposal to take two Bills from this place and put them into one Bill.^[4] The Commons agreed with the Senate proposal waiving its traditional privilege, and a single Bill was eventually given Royal Assent. I underline that that was the act of this House in waiving its tradition of privilege and accepting the invitation of the Senate to put two Bills together.

If it is admitted that the Senate can consolidate two Bills, why then can it not divide one Bill into two or more legislative measures? The answer is at least in part in the message. In the 1941 case just alluded to the Senate specifically sought the concurrence of the House for its action. Apparently it was the disposition of this place to accept it. In the message received last Friday relating to Bill C-103, the Senate does not seek the Commons' concurrence in the division of the Bill, it simply informs this House that it has done so, and returns half of a Bill.

[...]

Whatever honourable Members may feel, I do not think that this is a partisan matter. I am trying to make it very clear that it is a procedural matter, and a matter of some importance to the workings of this place and its very important relationship with the honourable the Senate, which is very much part of the Parliament of Canada.

The Speaker of the House of Commons by tradition does not rule on constitutional matters. It is not for me to decide whether the Senate has the constitutional power to do what it has done with Bill C-103. There is not any doubt that the Senate can amend a Bill, or it can reject it in whole or in part. There is some considerable doubt, at least in my mind, that the Senate can rewrite or redraft Bills originating in the Commons, potentially so as to change their principle as adopted by the House without again first seeking the agreement of the House. That I view as a matter of privilege and not a matter related to the Constitution.

In the case of Bill C-103, it is my opinion, and with great respect of course, that the Senate should have respected the propriety of asking the House of Commons to concur in its action of dividing Bill C-103 and in reporting only part of the Bill back as a fait accompli has infringed the privileges of this place.

Furthermore, Bill C-103 has attached to it, pursuant to our Standing Orders and Section 54 of the Constitution, a financial recommendation of Her Excellency the Governor General. Again, for those who are watching and who are uninitiated in all the terminology that we use, there is a requisite that in a Bill that is going to call upon the expenditure of funds, a financial recommendation of Her Excellency the Governor General is necessary. So this Bill is in a very real sense a Financial Bill. The Senate is somewhat limited in its review of Money Bills. Standing Order 87, which is still on the books after many decades, is quite clear and it states:

All aids and supplies granted to the Sovereign by the Parliament of Canada are the sole gift of the House of Commons, and all bills for granting such aids and supplies ought to begin with the House, as it is the undoubted right of the House to direct, limit, and appoint in all such bills, the ends, purposes, considerations, conditions, limitations and qualifications of such grants, which are not alterable by the Senate.

Certain questions remain to be answered: by splitting the Bill does the Royal Recommendation still apply? Have the financial privileges of the Commons been breached? Will the Crown assent to two Bills when it agreed to the introduction of a single one? As Speaker of the House of Commons, I will not attempt to answer such constitutional questions, but clearly this House has always considered Standing Order 87, which I just read, as setting out the special relationship between the Commons, that is, this House of Commons, and the Sovereign.

I have ruled that the privileges of the House have been infringed, However, and it is important to understand this, I am without the power to enforce them directly. I cannot rule the Message from the Senate out of order for that would leave Bill C-103 in limbo. In other words, it would be nowhere. The cure in this case is for the House to claim its privileges or to forgo them, if it so wishes, by way of message to Their Honours, that is, to the Senate, informing them accordingly.

In conclusion, I wish to state to the House that while Bill C-103 is a Government Bill, the same situation could arise under our reformed rules for a Private Members' Bill. It is in the better interests of this place to request Their Honours in the Senate to first consult with this House before they report to us such unilateral action. As Speaker of the House of Commons of Canada I must uphold the privileges of this place at all times, and I must also advocate them privately, publicly, and with vigour. Having said that, if on an issue of substance, the House wishes to waive those rights, as usual the Speaker will not enter into substantive debate but will follow the House's directives.

I thank all honourable Members for their valuable contributions in this most unique and interesting case.

On July 18, 1988, the House debated a Message to the Senate. The motion moved by the Minister of State and Minister of State (Treasury Board) indicated that, in the opinion of the House, the Senate had contravened Standing Order 87 and infringed its privileges, and asked that the Senate return Bill C-103 in an undivided farm.^[5] Later that day the House proceeded to the taking of the deferred division on the motion which was agreed to, on division.^[6] On August 18, 1988, a message was received from the Senate informing the House that Bill C-103 (as originally constituted) had been passed, without amendment.^[7] The Bill was given Royal Assent later that day.^[8]

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1988-07-11