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Parliamentary scrutiny of government spending plans

DOI: https://doi.org/10.58248/PB68 

• Commentators including the Organisation for Economic Co-operation and Development (OECD) have noted similarities in financial scrutiny between “Westminster-style” parliaments.
• While there is no agreed definition of a ‘Westminster style’, these may feature a “first-past-the-post” electoral system, elected legislatures and democratic elections with multiple parties. The OECD notes that in countries with a Westminster-style parliament, governments often have primacy over the legislature in budgetary matters.
• “Ex-ante” financial scrutiny refers to scrutiny of financial decisions around taxation and spending before money is spent. In 2019, the OECD reported that ex-ante scrutiny in its member countries had been growing.
• Ex-ante scrutiny of spending in the UK primarily concerns scrutiny of government Spending Reviews and Estimates, through which each department sets out its spending for the year ahead.
• The UK has been referred to as an "outlier" regarding some of its processes for the scrutiny of ex-ante government spending. For example, Estimates are not voted on before the fiscal year begins.
• Academics have suggested that limited scrutiny at key points in the financial cycle can weaken public trust in government.
• Several mechanisms exist in parliaments to support ex-ante scrutiny. These include committees, parliamentary budget offices, internal library and research services, external expertise and parliamentary processes such as amendments.
• Some Westminster-style parliaments have established budget committees in recent years to enhance scrutiny. The OECD has observed that the UK Parliament is the only OECD legislature without formal committee involvement in the budget approval process.
• Some Westminster-style parliaments have implemented parliamentary budget offices in recent years to support fiscal policy analysis.
• Governments can facilitate parliamentary ex-ante scrutiny, such as through the timetabling of the budgetary cycle and the provision of accessible budgetary information.
• In recent years, the UK Government has implemented some reforms to accounting practices with the aim of improving the presentation and reporting of public spending.