The House Of Lords And Statutory Instruments

I’ve been asked to explain how the House of Lords can reject the Government’s program of tax credit cuts when it hasn’t been able veto legislation since 1911. The answer lies in the distinction between primary and secondary legislation.

The term ‘primary legislation’ refers to Acts of Parliament. As is well known, the Parliament Acts 1911 & 1949 removed the House of Lords’ ability to permanently block most public bills, which can become law without peers’ consent if they are passed by the Commons in two sessions of Parliament.

But there is also a category of laws called ‘secondary legislation’ that often take the form of statutory instruments. A statutory instrument is basically a piece of legislation made by a person or body other than Parliament. Most are made by Ministers of the Crown, and they can also be called regulations, rules, or orders. Orders made by the Queen-in-Council can be statutory instruments as well. There are even cases where a statutory instrument can be made by someone outside the Government entirely (e.g., the Archbishops of Canterbury and York or the General Dental Council).

The important thing to remember about statutory instruments is that they ultimately derive their authority from Acts of Parliament. Parliament frequently delegates legislative authority to other entities for reasons of expediency or convenience. It’s not always possible to address every contingency in an Act of Parliament (particularly if it is concerned with issues that are extremely technical or subject to frequent change), so it often makes sense to let Ministers handle the details.

But statutory instruments are still subject to Parliament’s control. The most common form of control is what is known as the ‘negative procedure.’ This means that the instrument will automatically take effect unless either House of Parliament passes a resolution disapproving it (this often takes the form of a ‘prayer’ to the Queen asking her to annul the offending instrument). There is also the ‘affirmative procedure,’ but this is a lot less common. In these cases, the instruments must be explicitly approved by both Houses of Parliament before they can take effect. Regardless of which procedure is used, Parliament cannot amend a statutory instrument. It must be accepted or rejected in its entirety.

In most cases, the Lords have the same power of approval/disapproval as the Commons. Some have argued that there is a convention that peers will not reject statutory instruments. Nevertheless, the Lords have rejected several statutory instruments over the years. Perhaps the most famous example was their rejection of the Southern Rhodesia (United Nations Sanctions) Order in 1968. More recently, peers have voted down three statutory instruments in the past 15 years, with the most recent case being in 2007.

The Government claims that the House of Lords will be acting unconstitutionally if peers vote against the tax credit cuts. Their argument is based on two pillars: the existence of a convention that the Lords won’t reject statutory instruments and the Commons’ financial privilege. We’ve already seen that peers have rejected statutory instruments on several occasions over the years (ironically, many of these defeats were instigated by Tory peers when their party was the Opposition!), so it’s hard to argue that this convention is ironclad.

The argument from the Commons’ financial privilege is more enticing, but it is also far from airtight. It’s true that peers’ role in financial matters is generally a formality. For example, the annual Finance Bill usually passes through all of its parliamentary stages in the Lords in a single day. But the present Tax Credits (Income Thresholds and Determination of Rates) (Amendment) Regulations 2015 is made under the provisions of the Tax Credits Act 2002, which clearly gives the Lords the same powers as the Commons with regard to its statutory instruments. Parliament could have written the Tax Credits Act in such a way that MPs alone had the power of approval/disapproval, but it didn’t. This is in spite of the fact that other statutes strictly limit peers’ control over financial legislation. On the other hand, supporters of the Government might argue that the provisions of the Tax Credits Act must be viewed against the backdrop of the longstanding convention that the Lords do not intervene in financial matters.

Ultimately, the issue is a lot grayer than either side would probably like to admit, and it boils down to a dispute between the letter of the law and its spirit. Next Monday’s debate promises to be intense. Just two days ago, there were reports that peers were seeking a less confrontational approach. One of the regulations’ leading opponents, Baroness Meacher, was said to favor an official expression of disappointment rather than outright rejection. But evidently there has been a change of heart. According to the latest Order Paper, peers (including Baroness Meacher) have tabled three amendments to the Government’s approval motion. According to the Guardian, opinion in the Lords is coalescing around the amendment in the name of Labour backbencher Baroness Hollis of Heigham that would delay implementation of the cuts until the Government has established transitional protection for low-income individuals. Whatever happens, next Monday has the potential to become one of the most dramatic moments in the history of the Lords.

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