Tony Smith (Speaker) Share this | Hansard source

As I foreshadowed a little over an hour ago, in tabling correspondence from the Attorney-General and an opinion from the Solicitor-General, I'll make a statement in respect of this now. I wish to make a statement about the constitutional implications of the Senate's amendments to this bill. This statement follows the receipt by me of advice from the Attorney-General and the Solicitor-General which, as I said, I tabled just prior to the matter of public importance coming on so that members would have the opportunity to read both the correspondence and the Solicitor-General's advice.

In essence the advice to me is that the Senate's amendments increase a charge or burden on the people contrary to the requirements of section 53 of the Constitution. Further, I'm advised that those amendments do not comply with the requirement of section 56 of the Constitution; namely that a proposed law for the appropriation of revenue or moneys shall not be passed unless the purpose of the appropriation has in the same session been recommended by a message of the Governor-General to the House in which the proposal originated. Thus the Senate's amendments should have been made to the House as requested amendments.

Specifically the advice I have received is that the amendments, by creating a new Independent Health Advice Panel, would engage a standing appropriation in the Remuneration Tribunal Act 1973 in that a number of members of the panel would hold public offices for which the remuneration tribunal would need to determine remuneration. The remuneration would be paid out of the Consolidated Revenue Fund, which is appropriated for this purpose by a standing appropriation in the Remuneration Tribunal Act. The direct legal effect of the Senate's amendments thus would be to dictate an increase in expenditure under that existing appropriation. In terms of the test that the House has used, as referred to in House of Representatives Practicewhat are the probable, expected or intended practical consequences of the proposed amendment?—the advice to me is that section 53 is engaged by the proposed amendments.

In addition, as the Senate amendments would increase expenditure under a standing appropriation, the amendments would require a message to be reported from the Governor-General recommending an appropriation for them under section 56 of the Constitution.

The advice from the Attorney-General also referred to the importance of the House adhering to the requirements of sections 53 and 56 as otherwise, to quote the Attorney-General:

… the Senate would be given the power to dictate the expenditure of public revenue, with potentially crippling effects on public finances.

This reflects the important constitutional principle of the financial initiative of the Crown which rests with the House of Representatives and executive government.

Issues to do with section 53 of the Constitution have been matters of difference between the Houses since the early years of Federation. As it is generally recognised that the provisions of sections 53 and 56 are matters for the Houses themselves and may not be determined by the courts, the point has been made that this provides some flexibility. In considering the application of the third paragraph of section 53 of the Constitution, the House Standing Committee on Legal and Constitutional Affairs stated:

… the Committee considers that the Houses do, in some ways, have more flexibility in approaching the interpretation and application of the third paragraph of section 53 than if it were a strictly legal question.

In this respect, I note that the practice in relation to the creation of statutory offices and the reporting of messages under section 56 of the Constitution has at times varied. However, the committee also noted that it did not follow that the parliament should give the section any meaning it chose. The Attorney-General and the Solicitor-General have pointed to the direct link between an amendment proposed by the Senate and the engaging of additional expenditure under a standing appropriation in this particular case.

It is a matter for the House as to how it wishes to proceed with the Senate's amendments. The matter for consideration is not so much one of the privileges and rights of the two houses, as one of the observance of the requirements of the Constitution concerning the appropriation of revenue. I will leave it in the hands of the House as to how it wishes to proceed.

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