THE CONTROL OF EXPENDITURE

Timaru Herald, Volume CXXXVII, Issue 19667, 8 December 1933, Page 13

THE CONTROL OF EXPENDITURE

AUDITOR - GENERAL’S CRITICISM PRINCIPLES DEPARTED FROM (From Our Parliamentary Reporter.) WELLINGTON. December 6. Criticism of the system of passing on to others the power to appropriate public moneys which is constitutionally the prerogative of Parliament, is made in the report of Controller and Auditor-General presented to Parliament to-day. The report expressed the opinion that parliament had divested itself of the power to control expenditure, and that the Controller and Auditor-general had been divested of the responsibility of satisfying himself that the limitations hitherto placed by parliament on the transactions were being observed. It was also emphasised that the system of accounts on a cash basis was the only practical method by which efficient parliamentary control of national finances could be achieved, and that accounts drawn up on a commercial basis were not suitable for the purpose.

“A definite tendency has been noticeable recently,” he said, "to depart from the established methods which have been built up during a long period of years with a view to ensuring the proper and efficient control of parliament over the public expenditure. This tendency is shown in two directions. Firstly, there is a tendency to give statutory powers to members of the Government and others, the exercise of which powers amounts to the appropriation of particular funds to particular purposes, and thus in effect the power to appropriate public moneys, which is constitutionally the prerogative of Parliament, is passed on to others. It has always in the past been customary in New Zealand for parliament to segregate the public moneys into, particular funds and to limit application of each fund to a particular purpose or purposes. This was in accordance with a well-known constitutional principle.” Two essentials of the appropriation are that it should designate the fund from which the expenditure is to be made and the purpose for which it is to be made. Parliament appropriate* from each fund either by annual or permanent appropriation the moneys to be expended therefrom and thus controls the expenditure by deciding not only how much should be expended for a particular purpose but also from what statutory fund the expenditure should be made. Under the Public Revenues Act the responsibility is placed on the Audit office of ensuring that the moneys expended are charged against the fund provided by parliament for the same, that the appropriations of parliament are not exceeded and the moneys are used for the purposes for which they are voted. In some recent cases, however, the usual practice of specific appropriation by parliament has been departed from.

Cases are quoted in which the Minister is given power to appropriate moneys from any account, the power of appropriation being transferred from Parliament to the Minister. It would appear, therefore, the report states, that parliament ha* divested itself of the power to control expenditure in cases such as those mentioned, and the Controller and Auditor-General has been divested of the responsibility placed on him as an officer of parliament of satisfying himself that the limitations hitherto placed by parliament on such transactions were being observed.