Publications / Guides

What principles and rules govern the Budget process?

Prime Minister Rishi Sunak MP in the House of Commons Chamber, 1 March 2023. ©UK Parliament / Jessica Taylor
Prime Minister Rishi Sunak MP in the House of Commons Chamber, 1 March 2023. ©UK Parliament / Jessica Taylor

Parliament’s scrutiny and authorisation of the government’s taxation plans is fundamental to the political system. As the public’s representative body, it is Parliament’s responsibility to hold government to account – between elections – for the money it raises and spends.

This is the central constitutional principle underpinning the relationship between Parliament and government in relation to both taxation and expenditure. (For these purposes, the Crown is the government.) As Erskine May, the authoritative source on Parliament, sets out, “the Crown requests money, the Commons grant it, and the Lords assent to the grant”. This principle thus precludes Parliament from seeking to impose taxes (‘a charge upon the people’), or authorise expenditure, unless requested to do so by the government.

Control of taxation and expenditure can be exercised only by the House of Commons, not the House of Lords. As Erskine May states, the financial powers of the Upper House are limited ‘by the ancient ‘rights and privileges’ of the House of Commons’ and the terms of the Parliament Acts 1911 and 1949. The role of the House of Lords in respect of finance is ‘to agree, and not to initiate or amend’.

Taxes and duties set out in the Budget are known as a ‘charge upon the people’. Income and corporation tax provisions must be renewed annually in the Budget to maintain parliamentary control over these core revenue streams; but other taxes or duties may be introduced or increased, via the Budget, for a defined period or permanently. The Budget seeks to reconcile spending plans with projected income: the level of revenue requested by the government through taxation should only be that necessary to cover its expenditure (supply) plans.

The government’s taxation plans as set out in the Budget require statutory (that is, legislative) authority. The subsequent Finance Bill provides this.

These are Bills the primary purpose of which is to levy taxes or authorise expenditure. As it is such a Bill, the Finance Bill must:

  • originate in the House of Commons;

  • be based on ‘founding’ Ways and Means resolutions; and

  • adopt particular terminology in both the passage of the Bill and the signification of Royal Assent.

Historically it has been a convention that governments regard the votes at the end of the Budget debate as a matter of confidence. Given the fundamental importance of the Budget, if a vote was lost, it would likely be considered a resigning matter for a government. This would generally have led to a dissolution of Parliament and a general election. However, this was no longer the case after the passing of the Fixed-term Parliaments Act 2011. This Act was subsequently repealed and replaced by the Dissolution and Calling of Parliament Act 2022.

Whether the previous convention has been fully restored by this new Act has not yet been tested, although comments by Ministers during the parliamentary debate on the legislation suggest this was their intention.

Regardless, MPs – particularly government backbenchers – who vote against their party on the Budget are likely to lose the Whip.

08:06 am, 14 March 2023

Hansard Society (2022), How does Parliament authorise the Government's taxation plans? A procedural guide to the Budget process, (Hansard Society: London)

News / The day the King marched on Parliament: King Charles I, five MPs and the road to civil war - Parliament Matters podcast, Episode 102

In this episode we speak with historian Jonathan Healey about one of the most extraordinary days in parliamentary history when King Charles I entered the Commons Chamber with soldiers aiming to arrest five MPs. This dramatic moment, vividly recounted in Healey’s new book The Blood in Winter, marked a crucial turning point toward civil war. We explore the power struggles, propaganda, and the geography that shaped the fate of a nation and the Westminster Parliament. Please help us by completing our Listener Survey. It will only take a few minutes.

01 Aug 2025
Read more

News / Parliament gagged by super-injunction? A conversation with Joshua Rozenberg - Parliament Matters podcast, Episode 101

Legal expert Joshua Rozenberg joins us this week to unpack the legal and constitutional ramifications of one of the most troubling intersections of government secrecy, national security, and parliamentary accountability in recent memory. Thousands of Afghans who had worked with British forces were placed at risk of Taliban revenge attacks after a catastrophic government data leak in 2022 exposed their details. In response, ministers secured a “super-injunction” – so secret that even its existence could not be reported – effectively silencing public debate and preventing parliamentary scrutiny for almost two years. The breach, only revealed this week, led to a covert resettlement scheme which has already cost taxpayers millions of pounds. Please help us by completing our Listener Survey. It will only take a few minutes.

18 Jul 2025
Read more

News / One year on: How is Parliament performing? - Parliament Matters podcast, Episode 100

In our 100th episode, we take stock of Parliament one year after the 2024 general election. With a fractured opposition, a dominant Labour government, and a House of Commons still governed by rules designed for a two-party system, how well is this new Parliament really functioning? Please help us by completing our Listener Survey. It will only take a few minutes.

11 Jul 2025
Read more

News / Labour's welfare meltdown - Parliament Matters podcast, Episode 99

It’s been a bruising week for the Government, as a Labour backbench revolt forced ministers to gut their own welfare reforms live in the House of Commons. We explore why Sir Keir Starmer appears to have such a poor grip on parliamentary management. Plus, House of Lords reform expert Professor Meg Russell explains why the hereditary peers bill may be a once-in-a-generation chance to tackle deeper issues — like curbing prime ministerial patronage and reducing the bloated size of the upper chamber. And in Dorking, faith and politics collide over assisted dying. Please help us by completing our Listener Survey. It will only take a few minutes.

04 Jul 2025
Read more

Submissions / Parliamentary scrutiny of treaties - Our evidence to the House of Lords International Agreements Committee

Our evidence on treaty scrutiny has been published by the House of Lords International Agreements Committee. Our submission outlines the problems with the existing framework for treaty scrutiny and why legislative and cultural change are needed to improve Parliament's scrutiny role. Our evidence joins calls for a parliamentary consent vote for the most significant agreements, a stronger role for Parliament in shaping negotiating mandates and monitoring progress, and a sifting committee tasked with determining which agreements warrant the greatest scrutiny.

03 Jun 2025
Read more