Loss of Supply
Encyclopedia
Loss of supply occurs where a government in a parliamentary democracy using the Westminster System
or a system derived from it is denied a supply of treasury or exchequer funds, by whichever house or houses of parliament or head of state is constitutionally entitled to grant and deny supply. A defeat on a budgetary vote is one such way by which supply can be denied. Loss of supply is interpreted as indicating a loss of confidence
in the government. Not all 'money bills' are necessarily supply bills. For instance, in Australia, supply bills are defined as 'bills which are required by the Government to carry on its day-to-day business'.
When a loss of supply occurs, a prime minister
is generally required either by constitutional convention
or by explicit constitutional instruction to:
Some constitutions, however, do not allow the option of parliamentary dissolution but a governmental one or requiring a resignation.
A similar deadlock can occur within a presidential system
, where it is also known as a budget crisis
. In contrast to parliamentary systems, the failure of the legislature to authorize spending may not in all circumstances result in an election, because some such legislatures enjoy fixed terms and so cannot be dissolved before a date of termination, which can result in a prolonged crisis.
A deadlock between a head of state
and the legislative body can give rise and cause for a head of state to prematurely dismiss the elected government, requiring it to seek re-election. If a government maintains the support of a majority of legislators or the elected parliamentary representatives, the blocking of supply by a head of state would be seen as an abuse of authority and power. Many western countries have removed or restricted the right of a head of state to block supply or veto government budget unless there is overwhelming justification and cause for such action. If a government maintains the support of the elected parliament, the budget must be approved within a nominated period or else entitlement and authority for the approval of the budget is determined by a statutory majority of the parliament.
Westminster System
The Westminster system is a democratic parliamentary system of government modelled after the politics of the United Kingdom. This term comes from the Palace of Westminster, the seat of the Parliament of the United Kingdom....
or a system derived from it is denied a supply of treasury or exchequer funds, by whichever house or houses of parliament or head of state is constitutionally entitled to grant and deny supply. A defeat on a budgetary vote is one such way by which supply can be denied. Loss of supply is interpreted as indicating a loss of confidence
Motion of no confidence
A motion of no confidence is a parliamentary motion whose passing would demonstrate to the head of state that the elected parliament no longer has confidence in the appointed government.-Overview:Typically, when a parliament passes a vote of no...
in the government. Not all 'money bills' are necessarily supply bills. For instance, in Australia, supply bills are defined as 'bills which are required by the Government to carry on its day-to-day business'.
When a loss of supply occurs, a prime minister
Prime minister
A prime minister is the most senior minister of cabinet in the executive branch of government in a parliamentary system. In many systems, the prime minister selects and may dismiss other members of the cabinet, and allocates posts to members within the government. In most systems, the prime...
is generally required either by constitutional convention
Constitutional convention (political custom)
A constitutional convention is an informal and uncodified procedural agreement that is followed by the institutions of a state. In some states, notably those Commonwealth of Nations states that follow the Westminster system and whose political systems derive from British constitutional law, most...
or by explicit constitutional instruction to:
- resign immediately (allowing the majority blocking supply to form a government) or
- seek a parliamentary dissolution (so allowing the electorate to pass judgment on the issue).
Some constitutions, however, do not allow the option of parliamentary dissolution but a governmental one or requiring a resignation.
A similar deadlock can occur within a presidential system
Presidential system
A presidential system is a system of government where an executive branch exists and presides separately from the legislature, to which it is not responsible and which cannot, in normal circumstances, dismiss it....
, where it is also known as a budget crisis
Budget crisis
A budget crisis is an informal name for a situation in which the legislative and the executive in a presidential system deadlock and are unable to pass a budget. In presidential systems, the legislature has the power to pass a budget, but the executive often has a veto in which there are...
. In contrast to parliamentary systems, the failure of the legislature to authorize spending may not in all circumstances result in an election, because some such legislatures enjoy fixed terms and so cannot be dissolved before a date of termination, which can result in a prolonged crisis.
A deadlock between a head of state
Head of State
A head of state is the individual that serves as the chief public representative of a monarchy, republic, federation, commonwealth or other kind of state. His or her role generally includes legitimizing the state and exercising the political powers, functions, and duties granted to the head of...
and the legislative body can give rise and cause for a head of state to prematurely dismiss the elected government, requiring it to seek re-election. If a government maintains the support of a majority of legislators or the elected parliamentary representatives, the blocking of supply by a head of state would be seen as an abuse of authority and power. Many western countries have removed or restricted the right of a head of state to block supply or veto government budget unless there is overwhelming justification and cause for such action. If a government maintains the support of the elected parliament, the budget must be approved within a nominated period or else entitlement and authority for the approval of the budget is determined by a statutory majority of the parliament.
Examples of loss of supply
- In 1909, the UKUnited KingdomThe United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
House of LordsHouse of LordsThe House of Lords is the upper house of the Parliament of the United Kingdom. Like the House of Commons, it meets in the Palace of Westminster....
voted against the "People's BudgetPeople's BudgetThe 1909 People's Budget was a product of then British Prime Minister H. H. Asquith's Liberal government, introducing many unprecedented taxes on the wealthy and radical social welfare programmes to Britain's political life...
", precipitating two general elections and the Parliament Act 1911Parliament Act 1911The Parliament Act 1911 is an Act of the Parliament of the United Kingdom. It is constitutionally important and partly governs the relationship between the House of Commons and the House of Lords which make up the Houses of Parliament. This Act must be construed as one with the Parliament Act 1949...
, which limited the power of the Lords.
- In the 1975 Australian constitutional crisis, the elected SenateAustralian SenateThe Senate is the upper house of the bicameral Parliament of Australia, the lower house being the House of Representatives. Senators are popularly elected under a system of proportional representation. Senators are elected for a term that is usually six years; after a double dissolution, however,...
wilfully delayed voting on a bill which authorized supply for the government, until the Prime MinisterPrime Minister of AustraliaThe Prime Minister of the Commonwealth of Australia is the highest minister of the Crown, leader of the Cabinet and Head of Her Majesty's Australian Government, holding office on commission from the Governor-General of Australia. The office of Prime Minister is, in practice, the most powerful...
, Gough WhitlamGough WhitlamEdward Gough Whitlam, AC, QC , known as Gough Whitlam , served as the 21st Prime Minister of Australia. Whitlam led the Australian Labor Party to power at the 1972 election and retained government at the 1974 election, before being dismissed by Governor-General Sir John Kerr at the climax of the...
, called an election for the House of RepresentativesAustralian House of RepresentativesThe House of Representatives is one of the two houses of the Parliament of Australia; it is the lower house; the upper house is the Senate. Members of Parliament serve for terms of approximately three years....
. He was subsequently dismissed by the Governor-GeneralGovernor-General of AustraliaThe Governor-General of the Commonwealth of Australia is the representative in Australia at federal/national level of the Australian monarch . He or she exercises the supreme executive power of the Commonwealth...
, Sir John Kerr, on the basis of refusal to either resign or request a dissolution; his proposed course of action was instead to procure alternative supply money by non-parliamentary means. (Notably, Westminster convention requires the resignation of Government, or dissolution of Parliament, upon rejection of supply bills, which had not yet occurred--voting had simply been delayed. For this reason, among others, the validity under constitution conventions of the dismissal of the Whitlam Government continues to be debated to this day.)
- The defeat of Garret FitzGeraldGarret FitzGeraldGarret FitzGerald was an Irish politician who was twice Taoiseach of Ireland, serving in office from July 1981 to February 1982 and again from December 1982 to March 1987. FitzGerald was elected to Seanad Éireann in 1965 and was subsequently elected to Dáil Éireann as a Fine Gael TD in 1969. He...
's government in a budget vote in Dáil ÉireannDáil ÉireannDáil Éireann is the lower house, but principal chamber, of the Oireachtas , which also includes the President of Ireland and Seanad Éireann . It is directly elected at least once in every five years under the system of proportional representation by means of the single transferable vote...
in the Republic of IrelandRepublic of IrelandIreland , described as the Republic of Ireland , is a sovereign state in Europe occupying approximately five-sixths of the island of the same name. Its capital is Dublin. Ireland, which had a population of 4.58 million in 2011, is a constitutional republic governed as a parliamentary democracy,...
in 1982; FitzGerald immediately sought and was granted a Dáil dissolution.
- On 9 March 2011, the Legislative Council of Hong KongHong KongHong Kong is one of two Special Administrative Regions of the People's Republic of China , the other being Macau. A city-state situated on China's south coast and enclosed by the Pearl River Delta and South China Sea, it is renowned for its expansive skyline and deep natural harbour...
blocked a resolution for provisional appropriations, which, before 2011, had always been a matter of formality, pending the resumption of second reading debate and the third reading of the appropriation bill for the fiscal year from 1st April, which usually takes place in mid-April. Resolutions for provisional appropriations had never been voted by divisionDivision-Mathematics:*Division , the inverse of multiplication*Division , digital implementation of mathematical division*Division, in relational algebra-Science:*Cell division, the process in which biological cells multiply...
until 2011. The government decided, on the following day, to table another resolution on 16th March, with the subhead for miscellaneous expenses reduced by HK$500m, merely for the sake of circumventing the requirements in Rules of Procedure that a negatived question cannot be tabled again.