Guidelines on Process & Content of Legislation

CHAPTER 17 BILLS AFTER INTRODUCTION

Part 1: Are the recommendations in the departmental report and in any supplementary report appropriate?

Part 2: Have amendments to the Bill in any Government SOP been prepared in accordance with the Guidelines?

Part 3: Have any scope issues been anticipated and addressed?

Part 4: Do the financial veto provisions of the Standing Orders apply?

Introduction

Background

After a Bill is introduced, it will proceed through several stages, both in the House and in select committee. After it has passed its third reading, it becomes law when the Sovereign or the Governor-General assents to it and signs it in token of that assent.[259] It is then an Act of Parliament. Its provisions come into force at the time or times specified in the “commencement” section; otherwise, on the day after the Royal assent.[260]

A Bill’s main stages are its introduction, first reading, select committee process, second reading, committee of the whole House, and third reading, followed by the Royal assent. Each of these, for a Government Bill, is discussed briefly below in turn.

The emphasis of the discussion of issues in this chapter is on how departmental advisers can facilitate a Bill’s progress after introduction, with particular reference to what happens at select committee and the committee of the whole House, as it then that officials are most intensely engaged with the passage of the Bill.

New Zealand has a unicameral legislature. Unlike legislatures overseas, there is no Second Chamber or Upper House to scrutinise legislation. This crucial role is carried out in New Zealand by select committees. It will often only be at the stage that a Bill comes before a select committee that members of Parliament and the public get an opportunity to examine the Bill in detail. Almost all Bills are referred to subject select committees. Both the policy and detailed provisions of Bills are robustly tested in the select committee process. Bills can be altered radically as a result of consideration by select committees. Bills may also be changed significantly during the Committee of the Whole House stage. Both the select committee and committee stages bring officials into direct contact with the legislative process. This is both challenging and fascinating. It is important that officials understand the processes and their role.

A Bill may have to change to accommodate the political realities of MMP, which require acceptable compromises of policy, especially in non-core areas of a Bill’s policy objectives. Pressure for changing a Bill is felt most at its select committee and committee of the whole House stages.

Not all Bills pass through all the usual stages, and there are variations of the procedures a Bill may follow.[261] For a full explanation of what may happen to a Bill after introduction, as well as of the roles played by select committee members, the Office of the Clerk, officials, parliamentary counsel and others, see—

  • Standing Orders of the House of Representatives (2005):
  • Speakers’ Rulings (2005):
  • Parliamentary Practice in New Zealand, David McGee, 3rd edition, 2005, Wellington: Dunmore Publishing Ltd:
  • Public Servants and Select Committees – Guidelines (State Services Commission):
  • Step by Step Guide (Cabinet Office):
  • Cabinet Manual (2001):
  • Statute Law in New Zealand, J.F. Burrows, 3rd edition, 2003, Wellington: LexisNexis:
  • Parliamentary Counsel Office Drafting Manual (when publicly available):
  • Guide to working with the Parliamentary Counsel Office, 2nd edition, 2005.

A Bill’s introduction into the House

The Clerk of the House announces to the House the introduction of a Bill.[262] Notice must be given to the Clerk of the intention to introduce the Bill.[263]

When a Bill is introduced, it is in a printed version which has an explanatory note preceding the text of the Bill.[264] The explanatory note contains an explanation of the policy that the Bill implements (the “general policy statement”), prepared by officials, and a clause-by-clause analysis of the Bill, prepared by the drafter from Parliamentary Counsel Office (“PCO”) who drafted the Bill. If a Business Compliance Cost Statement has been prepared for the Bill, it will be included in the explanatory note, along with the Regulatory Impact Statement.

A Bill’s introduction to the House is followed by a pause before it has its first reading, which is no sooner than the third sitting day after the Bill’s introduction[265].

The purpose of both the pause and the explanatory note is to allow Members to become familiar with the Bill, understand its content, and prepare for debate on it.

At the time a Government Bill is introduced, the Attorney-General brings to the attention of the House any apparent inconsistency between its provisions and the New Zealand Bill of Rights Act 1990.[266]

First reading

The first reading debate provides an opportunity for the Minister in charge of the Bill to describe the Bill’s purpose, propose its referral to a particular select committee, and indicate whether any special instruction should be given to the select committee which is to consider the Bill; for example, to report the Bill back to the House by a particular date.[267] The first reading debate, limited to 2 hours, is usually on the general principles of the Bill. If the House agrees with the motion that the Bill be read a first time, it is then referred to a select committee.

A Bill at select committee

Nearly all Bills are referred to a select committee. The New Zealand legislature is unusual in its routine referral of Bills to select committees, and the extent to which Bills may be subject to change in select committee.

The following observation is particularly apposite: “It is not unknown for bills to emerge from select committees almost totally rewritten ..... Close attention to legislation has occurred under minority governments since the majority of committee members is frequently not from the government.” [268]

The purpose of the select committee process is essentially—

  • to provide an opportunity for the House to scrutinise a Bill, through a specialist subject committee:
  • to recommend whether it should be passed and any changes[269], from tidying-up of minor errors to substantive changes:
  • to consider public submissions:
  • to obtain the advice of the department responsible for the Bill and the Minister, if appropriate, on any aspects of the Bill.

The default time period a Bill spends in select committee is limited to 6 months[270]. During that time, the select committee will—

  • call for and hear public submissions on the Bill:
  • receive an initial briefing on the Bill from the department responsible for the Bill:
  • consider a report from the department recommending changes to the Bill:
  • decide whether to request those or other changes to the Bill:
  • consider the draft of the amendments requested:
  • decide whether it agrees with those amendments as drafted:
  • determine whether to recommend to the House that the Bill be passed:
  • prepare a report to the House on the Bill with a commentary on the amendments to it that the committee has agreed upon:
  • report the Bill back to the House in its amended form, along with the committee’s report.

Under MMP, select committees often do not have a Government majority, and may not have a Government or coalition chairperson. It cannot be expected that a Bill will pass unchanged through the select committee process simply on the basis that the Bill’s provisions represent settled Government policy. It has been noted that “(s)elect committees without government majorities are more prone to accept amendments than they were under FPP. It is possible to re-litigate aspects of the policy quite fundamentally at select committees on occasion”.[271]

Select committees often recognise however that there is a high probability that a Government Bill will pass and consequently put their efforts into making the legislation of as high a standard as possible, whether or not they support the overall policy of the Bill.

The select committee calls for public submissions on the Bill, and it usually requests submissions to be made within a month after the first reading. The purpose of public submissions on a Bill is to provide an opportunity for interested organisations and individuals to give their opinions of the Bill.

While some submissions may express support for the Bill and seek no changes to it, the submission process is valuable for its ability to draw out those submissions which put issues or concerns raised by a Bill before the committee, with a view to persuading the committee to recommend changes to the Bill.

Submissions are made in writing, but submitters can indicate whether they wish also to appear before the committee and make further oral submissions to it. Depending on the topic of the Bill, there may be a handful of submissions, hundreds, or even thousands.

It is part of the role of the departmental advisers to summarise the submissions made on the Bill, advise the committee on them, and recommend to the committee any appropriate changes based on those submissions. Select committees also frequently request advice and reports from officials on particular issues raised by a Bill.

Submissions may encourage non-Government committee members to take issue with Government policy in the Bill as introduced. Not having been privy to the policy iterations preceding the Bill’s introduction, those committee members may be persuaded by what is, to them, a novel argument. They may be unaware that its weight had already gone into the scales during the balancing exercise of policy development. Officials should ensure that they remain aware of how policy decisions reflected in the Bill were reached, to prepare for challenges to a Bill’s underlying policy.

The departmental report[272] forms the basis for most of the amendments the select committee requests be made to a Bill. The select committee considers the departmental report and decides by voting whether to accept each of its recommendations. PCO prepares a draft of the amendments to which the select committee has agreed and goes through it with the departmental advisers to ensure it reflects what the committee has requested.

When PCO and the departmental advisers have settled the draft, the select committee examines it with the assistance of the drafter. This process is called “consideration”. The select committee votes on whether or not to accept the draft amendments, in a process called “deliberation”. Any proposed amendment must receive a majority of the votes: tied votes are equivalent to a rejection of the amendment. There is no proxy voting during deliberation or at any other select committee meetings.

When a select committee reports back to the House on a Bill, it states whether or not it recommends that the House pass the Bill, and provides a commentary to explain what changes it has recommended be made to the Bill, and the reasons for those changes[273]. Minority views may be stated as such in the commentary.

The reported-back version of the Bill (called the “revision-tracked” Bill) shows amendments by marking the proposed textual changes, in the form of crossed-out text or inserted text, into the version of the Bill as it was introduced. Each amendment is shown as either one which has been agreed to unanimously by the committee, or by a majority[274]. Both the commentary and the method of showing amendments to the text are designed to make it clear to Members how the select committee has agreed that the Bill as introduced should be amended[275].

The department responsible for the Bill acts as adviser to the select committee as it considers the Bill. Typically, this will require officials to—

  • provide the committee with an initial briefing on the Bill before the committee begins to hear submissions:
  • provide advice and reports on particular issues raised by the Bill or that arise from public submissions:
  • provide a departmental report which summarises and comments on submissions, and makes recommendations for changes to the Bill arising from the submission process or from any changes the Government wishes to make:
  • work with PCO on the drafting of amendments to the Bill:
  • check the draft commentary prepared by the Clerk’s Office for its accuracy in describing amendments made by the committee.

The “hands on” approach to the scrutiny of Bills and the extent of changes has obvious strengths, but also disadvantages. The Bill may become less coherent if new policy matters are added or changes are made to secure individual or party support. Changes to one area of a Bill may sit awkwardly with some of its other provisions. While a select committee can examine the Bill to decide whether it is desirable to amend it on the basis of an adverse section 7 report from the Attorney-General, amendments proposed by the select committee are not checked routinely for consistency with the principles of the New Zealand Bill of Rights Act 1990 and may be inconsistent with them.

Officials should check whether changes proposed to a Bill in select committee create internal inconsistency, or conflict with other legislation. Every effort should be made to ensure that the Bill remains consistent with the Guidelines.

Second Reading

Again, after the Bill is reported back, there is a pause before the second reading, in order that Members can become familiar with the commentary of the select committee and the Bill as reported back by it. The second reading does not take place before the third sitting day after the Bill has been reported back[276].

The second reading debate may last up to 2 hours. The issues discussed by Members during the debate may give officials an indication of what remains contentious about the Bill, indicating what further amendments to it may be proposed by Members for the committee of the whole House stage, or what the Minister may need to clarify further for the House about the Bill’s policy and provisions.

All unanimous amendments recommended by the select committee are agreed to by agreeing to the Bill’s second reading, and agreement to all majority amendments is treated as the subject of a single question[277].

Committee of the whole House

The debate at the committee of the whole House stage provides an opportunity for the House to consider and debate the Bill in detail. The purpose is to determine whether the Bill meets the principles and objects of the Bill as read a second time [278].

The Government may propose further changes, which may be substantive and represent a new policy objective or may be minor technical changes to correct flaws in the Bill. There is no time limit on this debate, and it presents the last opportunity to amend the Bill, by Supplementary Order Paper (“SOP”)[279] or by “table”[280] amendment.

This debate represents a final chance for the Government to undo amendments made at select committee: “...the government can, and often does, try to assert itself again at the Committee of the Whole where the opinion of the select committee does not reflect the opinion of the majority in the House.”[281]

Officials attend the House during this stage to advise the Minister in charge of the Bill about any points concerning the Bill which arise during the debate and also on any amendments proposed by Members. The PCO drafter also attends to advise on drafting issues, whether or not there is an SOP containing proposed amendments.

Bills are debated Part by Part or, if the Bill is not divided into Parts, clause by clause. Thus, division of a Bill into a small number of Parts reduces the House time needed to debate it, a factor encouraging that organisation of a Bill’s contents, given the constraints on House time. There is also a separate debate, usually the final debate, on the “preliminary” clauses of the Bill, that is, the Title clause and the commencement clause. Any Schedule is debated along with the Part or clause to which it relates.[282]

A Bill which is to become 2 or more Acts, such as a Statutes Amendment Bill which amends several statutes, is divided at the end of the committee of the whole House stage into its component Bills, by means of a “break-up” SOP.

Occasionally a Bill may have to go back into the House prior to its third reading for a further committee of the whole House stage. This is called “recommittal”.[283] Recommittal may be preferable to later amendment of an Act, and it is only ever undertaken to correct an error in a Bill, because amendment is not possible during a Bill’s third reading. Officials should check the Bill carefully before and during the committee of the whole House stage for anything which may need correction, to avoid recommittal, if possible. For example, a Bill may have spent so long in the stages after its introduction that the original commencement date has passed.

It may be desirable for the House to depart from the usual sequential debate on clauses and Parts, and to vote on the clauses or Parts of the Bill in an order other than the one in which they occur in the Bill. For example, an earlier Part of the Bill, such as an outline of a Bill’s Parts, may be affected by a proposed change to a later Part. Officials should raise the matter with the Minister in charge of the Bill and the Clerk of the House as soon as the need for a different sequence of debate becomes a possibility.

Third reading

When the chairperson’s report is adopted by the House, the Bill is set down for its third reading on the next sitting day. If the House is not proceeding with the remaining stages of the Bill under urgency, the Bill will be reprinted prior to its third reading with the amendments agreed to by the House in the committee of the whole stage.

The third reading debate may be up to 2 hours on the Bill. Debate is limited to general principles, and debate on previously proposed but unsuccessful amendments is out of order.[284] There is little for officials to do at this stage in regard to the Bill’s passage, other than to assist the Minister’s office in the preparation of any planned media release about the new statute.

A Bill is passed by the House when the House has agreed that the Bill be read a third time.[285]

Royal assent to a Bill

A Bill becomes an Act of Parliament when it receives the Royal assent. The Clerk of the House is responsible for preparing a copy of the Bill for the Royal assent. In practice, the Office of the Clerk prepares a “proof assent”, that is, a proof copy of the Bill incorporating all the changes made to the Bill as introduced by the House in the select committee and the committee of the whole stages. The proof assent copy is carefully checked by the Office of the Clerk and by the PCO.

In preparing the Bill for assent, amendments of a verbal or formal nature may be made and clerical or typographical errors may be corrected by the Clerk.[286] For example, a Bill that has been amended extensively during its passage through the House may require renumbering and changes to internal cross-references. Preparation of the proof assent can be time-consuming, especially for long and complex Bills and it is not uncommon for there to be several versions of a proof assent copy of a Bill. The PCO may provide a proof assent copy of a Bill to the instructing department to check, particularly if it is long and complex.

The Clerk presents 2 copies of the Bill to the Governor-General for Royal assent. When the Bill has received the Royal assent, the Clerk deposits one copy with the Registrar of the High Court at Wellington and retains the other.[287]

Issues

During the stages through which a Bill passes after introduction and before becoming an Act of Parliament, the following issues may arise and are discussed in this chapter:

Part 1: Are the recommendations in the departmental report and in any supplementary report appropriate?

Part 2: Have amendments to the Bill in any Government SOP been prepared in accordance with the Guidelines?

Part 3: Have any scope issues been anticipated and addressed?

Part 4: Do the financial veto provisions of the Standing Orders apply?

PART 1

ARE THE RECOMMENDATIONS IN THE DEPARTMENTAL REPORT AND IN ANY SUPPLEMENTARY REPORT APPROPRIATE?

17.1.1 Outline of issue

After the select committee receives and hears submissions on a Bill, the department responsible for the Bill writes a report, called “the departmental report”, for the committee.[288] Officials should ensure that this report’s discussion of issues and its recommendations, and those in any supplementary report, assist the select committee in deciding what changes should be made to the Bill.

17.1.2 Comment

Departmental reports can take a variety of forms. The departmental report usually contains an overview of the topics traversed in the submissions. The report should also summarize the submissions made on each clause, with discussion and analysis of the issues raised by the submissions, and make a recommendation or recommendations with regard to each of the issues and the changes proposed generally and for each clause. It is on the basis of the select committee’s acceptance or rejection of the recommendations in the departmental report that PCO prepares a “revision-tracked” version of the Bill, reflecting changes which the select committee has requested.

The departmental report provides an opportunity for the department to make recommendations beyond those suggested by the submitters. The submissions themselves, or the time for reflection afforded by the period between introduction of the Bill and the closing date for submissions, may suggest some further possible refinement of the policy objectives in the Bill as introduced. Officials should consult their Minister about new ideas. A further Cabinet decision may be required if an amendment may be necessary on which no Cabinet decision has been made or which does not accord with an earlier Cabinet decision.

Drafts of the departmental report should be shown to the PCO drafter, who will provide comments to the department. The report should always contain a standard recommendation that PCO be authorised by the committee to make any changes of a technical or drafting nature that may be required. This allows PCO to fine-tune such matters as punctuation and drafting style. It is helpful for PCO, and as a means of reference during the Committee’s later consideration of draft changes to the Bill, if the recommendations are numbered individually.

Officials should always avoid recommending particular wording for suggested changes, unless done in conjunction with PCO. As with the drafting of the Bill itself, it is important to convey what the proposed changes are intended to achieve, and leave it to the PCO drafter to determine how this is best achieved.

The provisions proposed in recommendations in the departmental report should themselves conform to the Guidelines. For example, officials should be aware of a possible conflict with the principles of the New Zealand Bill of Rights Act 1990 when proposing new powers of detention and of possible adverse retrospectivity problems.

Supplementary reports

After officials present the departmental report to the select committee, the committee members may require officials to provide the committee with further reports on various questions or issues which arise. These questions may cover a wide range of topics. For example, the committee may request a report on the current case law on an existing legislative provision, the statistical incidence of a particular condition or event, or the feasibility of another approach to a problem the Bill is trying to address.

Officials should give objective advice about alternative approaches. Officials should also point out any foreseeable difficulties which would be caused by an alternative approach, for example, any inconsistency between a possible approach and any Cabinet policy approvals, or a potential conflict with other legislation.

When preparing supplementary reports, officials should bear in mind generally the same considerations and constraints that apply to departmental reports, and specifically those which apply to the recommendations in departmental reports, as discussed above.

17.1.3 Guidelines

Officials should ensure that recommendations in a departmental report or supplementary report for changes to a Bill—

  • are consistent with the Bill’s overall policy objectives as agreed to by Cabinet:
  • are within the scope of the Bill, or of the Act it amends (if it is an amending Bill):[289]
  • conform to the LAC Guidelines, including such matters as conformity to principles in the New Zealand Bill of Rights Act 1990
  • have no more than a minor effect on the government’s fiscal aggregates or any Vote:[290]

PART 2

HAVE AMENDMENTS TO THE BILL IN ANY GOVERNMENT SOP BEEN PREPARED IN ACCORDANCE WITH THE GUIDELINES?

17.2.1 Outline of issue

An SOP is a proposal to amend a Bill after introduction. The amendments in the SOP are additional to, or instead of, any changes that may be recommended by the select committee considering the Bill.

17.2.2 Comment

An SOP is a supplement to the House’s Order Paper. It is a printed document containing proposed amendments to a Bill that has already been introduced.

SOPs can be prepared and tabled in the House at any time up to and including the committee of the whole House stage of a Bill. Government SOPs are always drafted by PCO in consultation with the department responsible for the Bill, and are usually moved by the Minister in charge of the Bill at the committee of the whole House stage.

In the preparation of any SOP, officials must revisit the LAC Guidelines Checklist, as the same questions arise for an SOP as for the Bill itself. For example, officials should be aware of the need to ensure consistency with the principles in the New Zealand Bill of Rights Act 1990, the Treaty of Waitangi, other legislation in the same area as the Bill, and general legal principles, such as avoiding retrospectivity.

An SOP may also be referred to the select committee to which the Bill has been referred and be considered along with the Bill. This procedure is more likely if the SOP contains new policy matters. Public submissions on the SOP may be called for by the committee. It will also receive the same sort of scrutiny that the Bill itself must receive. For example, if the SOP proposes any regulation-making powers, the Regulations Review Committee may examine it and report on it. An SOP before a select committee may even be subject to a Bill of Rights Act vetting additional to that undergone by the Bill prior to its introduction.[291]

Once a Bill is back in the House, any Member can table an SOP on the Bill. The Minister in charge of the Bill may table an SOP containing amendments the Government wishes to make to the Bill. These may range from substantial changes to minor technical changes of a tidying up nature.

An SOP which is introduced after the Bill is reported back to the House may come from a Member from one of the opposition or other minority parties, with the aim of making amendments on specific issues viewed as crucial by that party. The Government may wish to lend its support to such an SOP, either because the Government agrees with the amendment proposed by that Member, or the support of that other party is necessary to the Government so that the Bill can pass. The latter situation is more likely to occur in an MMP Parliament than previously. When the Government supports such an SOP, it may direct PCO to draft it, and officials may also be required to advise.

Officials should examine any SOP which they have not prepared, but to which it seems possible that the House may agree, to see whether the amendments proposed in it will create inconsistencies with the rest of the legislative scheme of the Bill, and in turn require further amendment to be made to the Bill. Although often very little time is available to officials for analysis, it is worth using some of that time to go through the LAC Guidelines Checklist.

17.2.3 Guidelines

An SOP should conform to the LAC Guidelines for a Bill, and officials should use any time available to them for considering an SOP to check its conformity with the Guidelines, its consistency with the rest of the Bill, and its conformity to other relevant legislation and to general legal principles, as well as identifying whether the SOP will in turn require further amendment to be made to the Bill.

PART 3

HAVE ANY SCOPE ISSUES BEEN ANTICIPATED AND ADDRESSED?

17.3.1 Outline of issue

A proposed amendment can be on any topic, so it may well raise questions of scope. The scope of a Bill is the topic, or range of topics, it covers[292]. A question of scope is one about a proposed amendment’s relevance to the subject matter of the Bill. Any amendment to a Bill which is proposed at any time after its introduction should be within the scope of the Bill as introduced. That is to discourage Parliament from passing laws on topics other than those that have been signalled clearly to the public, and to the House itself, without proper scrutiny.

17.3.2 Comment

If a question of scope arises when a Bill is before the select committee, the Chair of the committee refers the question to its clerk, who will seek advice from the Office of the Clerk. Officials can also ask for a provisional opinion of a proposal in outline, before it is drafted.

However, even an amendment which appears to be on much the same topic as the Bill itself may not be within its scope. For example, an SOP to an amending Bill, dealing with one Part of the Act which the Bill amends, may be outside the scope of a Bill which, as introduced, deals only with another Part of that Act.

If an SOP contains amendments to a Bill that are out of scope, the House must technically instruct the committee of the whole to consider the SOP. This is a debatable motion on which there is no time limit, although the House can agree to a time limit. The House can, and sometimes does, by leave agree to consider an SOP that is out of scope without requiring an instruction and associated debate. Typically, this occurs if the amendments, although out of scope, are technical, uncontroversial, or otherwise have the complete support of the House.

Whether proposed amendments are within the scope of a Bill can give rise to difficult questions. If there is any doubt, the advice of the Office of the Clerk should always be sought. Parliamentary Counsel can also advise departments. The final decision on scope issues, however, is made by the Speaker who will receive advice on the matter from the Clerk of the House.

Questions of scope may arise whenever an amendment to a Bill is proposed, including when a select committee is preparing to recommend amendments to a Bill. If a question as to scope arises when a Bill is still before the select committee,[293] the Chair of the committee will refer the question to the Committee Clerk, who will seek advice from the Office of the Clerk. The Chair will then rule on the matter.

17.3.3 Guidelines

Always seek advice early as to whether an SOP or other proposed amendment may be out of scope. If it is, consider the following possibilities:

  • the amendments may have to be part of a later Bill:
  • it may be possible for the House to give leave for the SOP to be considered without a debate or with a time-limited debate:
  • the Government may wish to proceed even though leave is not likely to be given.

PART 4

DO THE FINANCIAL VETO PROVISIONS OF THE STANDING ORDERS APPLY?

17.4.1 Outline of issue

Any amendment to a Bill proposed by a select committee and any amendment to a Bill proposed after the Bill is reported back to the House may risk incurring a financial veto if its effect would be to have more than a minor impact on the Government’s fiscal aggregates or the composition of a Vote.[294] It is important to be aware, therefore, of the financial consequences of any proposed amendment, whatever its form (such as SOP, or “table” amendment) or source (such as select committee, Government Member, or other Member).

17.4.2 Comment

The financial consequences of a Bill, both to the Government and to the public, are assessed as part of the policy development associated with the Bill. Cabinet agrees to a Bill on the basis of its known likely costs. The same is not always true for amendments to a Bill proposed after it is introduced. Those amendments may be suggested by a select committee or by Members in the committee of the whole House stage.

In addition to the many other matters which need to be considered when statutory provisions are developed, a proposed amendment to a Bill may have fiscal consequences if it is passed. Examples include any amendment which would create a new department or a further demand on the resources of an existing Government-funded agency. Any Vote which will be affected by the amendment is also relevant to a potential financial veto. The Standing Orders set out the details of the financial veto provisions at SO 318 to 322.

Officials should not overlook the possible fiscal consequences of amendments proposed by a select committee, or proposed after the Bill is returned to the House, or even passed by the committee of the whole House. Cabinet Office Circular CO (07) 2 sets out in full the financial veto procedure and the actions required of officials should the situation arise that the veto may need to be invoked.

A financial veto can be exercised when amendments to a Bill are proposed by a select committee and before they are agreed to by the House. During the committee of the whole House stage, the veto can be exercised as soon as notice is given of the relevant amendment. Although it is possible to issue a financial veto certificate for a whole Bill, this is unlikely in the case of a Government Bill. Any financial veto certificate relating to a Bill may only be given when the Bill is awaiting its third reading.[295]

In the committee of the whole House stage of a Bill, if it seems that a proposed amendment may have more than a minor effect on the fiscal aggregates, at least 24 hours’ notice must be given by the Member proposing the amendment in the committee of the whole House. Unless notice is given, the amendment is usually out of order. However, officials should be particularly alert when the House, under urgency, proceeds to the committee of the whole House stage immediately after the second reading, as in such circumstances the 24-hour notice period is not required. It is not only the department responsible for the Bill that may be affected by a proposed amendment. Thus, every department is required to have processes to monitor parliamentary initiatives, such as the passage of Bills and proposed amendments to them, to identify amendments that have the potential to effect changes to that department’s Vote.

When it is clear that a proposed amendment may be a candidate for a financial veto, the department concerned should approach the Treasury about the issue. The Treasury will co-ordinate the response and arrange for the issue of a veto certificate, if appropriate.

17.4.3 Guidelines

Officials should follow the procedures in Cabinet Office Circular CO (07) 2. In summary, the main actions required are:

Have processes in place for monitoring developments in the House and select committees affecting your Minister's portfolio, and for identifying and advising promptly on proposed amendments which may impact on the government's fiscal aggregates or the composition of a Vote.

Be aware that notice of an Amendment can be given the day before it is moved and in some circumstances with less than 24 hours' notice.

Check whether a proposed Amendment, either in the form of a “table” Amendment or an SOP, if it is passed, will affect any Vote or have more than a minor impact on the government's fiscal aggregates.

If so, alert the portfolio Minister, the Minister of Finance, and the Treasury immediately so that the Treasury can co-ordinate a response and arrange for the issue of a financial veto certificate, if appropriate.

Footnotes

259 See section 16 of the Constitution Act 1986.

260 See section 8 of the Interpretation Act 1999.

261 For example, if a Bill is passed under urgency, it may not be referred to a select committee. Appropriation Bills and Imprest Supply Bills are not referred to a select committee. Occasionally, with the agreement of the Business Committee or leave of the House, the committee of the whole House stage of a Bill is omitted.

262 See SO 281

263 See SO 275

264 See SO 258

265 See SO 282

266 See section 7(a) of the New Zealand Bill of Rights Act 1990. Such a report is called a “section 7 report”. Another benefit of the pause between introduction and first reading is that the Attorney-General can examine the provisions of any non-Government Bill for consistency with the Act, so as to report to the House as soon as practicable any apparent inconsistency: See section 7(b) of the New Zealand Bill of Rights Act 1990.

267 See SO 284

268 Bridled Power, Geoffrey Palmer and Matthew Palmer, 4th edition, 2005, Melbourne, Oxford University Press, page 197

269 See SO 287(1)

270 See SO 291: The time for the report may be extended by the Business Committee. Occasionally, if a measure is regarded as urgent, the time for reporting may be much sooner than 6 months. Prior to this default time period, Bills could remain at select committee for lengthy periods.

271 See page 374 of the 4th edition (2005) of Geoffrey Palmer and Matthew Palmer’s Bridled Power.

272 See Part 1, below, for a discussion of the departmental advisers’ role in regard to the departmental report.

273 See SO 287

274 See SO 288

275 Prior to changes to the Standing Orders in 1996, the House was informed of amendments proposed by the select committee by its Chair addressing the House and describing the changes which the committee proposed. Textual amendments consisted of slips of paper pasted into a copy of the Bill as introduced.

276 See SO 292

277 See SO 294

278 See SO 297

279 A Supplementary Order Paper: See Part 2, below for a discussion of what officials need to consider in relation to SOPs.

280 A proposed amendment which is not printed. These may be photocopies of manuscript proposed amendments. They are brought to the attention of the House by placing them on the table in the House.

281 See page 374 of the 4th edition (2005) of Geoffrey Palmer and Matthew Palmer’s Bridled Power.

282 See SO 298

283 See SO 307

284 See page 390 of the 3rd edition (2005) of David McGee’s Parliamentary Practice in New Zealand.

285 See SO 310

286 See SO 312

287 See SO 313

288 If more than 1 department is responsible for administrating an Act, or different parts of an Act, providing the departmental report will be a shared task also.

289 See Part 3.

290 See Part 4.

291 See www.justice.govt.nz/bill-of-rights for a Bill of Rights vet in October 2004 of an SOP, the “Restricted Substances” SOP to the Misuse of Drugs Amendment Bill (No 3).

292 For a comprehensive discussion of this concept, see page 376 of the 3rd edition (2005) of David McGee’s Parliamentary Practice in New Zealand.

293 A select committee may recommend only amendments that are relevant to the subject matter of the Bill: see SO 288. The same is true for the committee of the Whole House: See SO 297.

294 See SO 318 to SO 322.

295 See SO 320

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