In the introduction to last week’s article, we made brief reference to the Court of Appeal’s decision to overturn the ruling of the former acting Chief Justice on the “2012 budget cuts” case. From the very inception, we had indicated our disagreement with the ruling which we felt contributed enormously to: (a) the difficulties associated with the approval of the 2013 and 2014 budgets and the resulting tensions emanating from such approval; (b) the incurrence of excess expenditure of $4.544 billion in defiance of the wishes of the National Assembly; (c) the motion for a vote of no confidence in the Government; (d) the prorogation and subsequent dissolution of Parliament; and (e) the holding of fresh elections after three years. Indeed, we believe that the ruling was a major contributor to the recent change in the political landscape of Guyana.
Today, we examine the decision of the Court of Appeal to overturn the Chief Justice’s ruling, based on an appeal by the then Speaker of the National Assembly.
Background to the “2012
budget cuts” case
Article 218 of the Constitution provides for the Minister of Finance or any other Minister designated by the President to prepare and lay before the Assembly estimates of revenue and expenditure of Guyana for each year. On the appointed day, the Minister moves a motion for the approval of the Estimates and proceeds to present the said estimates via his/her budget speech. This is followed by the general debate on the Minister’s presentation. The Assembly then resolves itself into the Committee of Supply for a detailed consideration of the Estimates. In addition, by Rule 76(4) of the Standing Orders, any member can move a motion for an amendment to a Head of Expenditure to reduce the sum allotted in respect of any item. When the Assembly approves the Estimates, the Minister introduces an Appropriation Bill to provide for issues from the Consolidated Fund.
On 30 April 2012, the Assembly approved of the estimates of expenditure for 2012 in the sum of $172 billion against the Government’s proposal of $192.8 billion, a downward adjustment of $20.8 billion. Accordingly, the Minister of Finance amended the Appropriation Bill to reflect the adjustment; the Assembly approved of the amended Bill; and the President gave its assent to it. Notwithstanding this, the Government sought a judicial review of the Assembly’s decision on the grounds that: (a) the Assembly acted unconstitutionally; and (b) it could either approve the budget or reject it, but not reduce it.
Chief Justice’s preliminary ruling
The Chief Justice upheld the Government’s position on both grounds, no doubt basing his ruling on the words “When the estimates of expenditure (…) have been approved by the Assembly”. Both the Constitution and the Fiscal Management Accountability (FMA) Act are silent on the sequence of events between the time the Estimates are laid, and their approval by the Assembly. Article 165 (1) nevertheless provides for the Assembly to regulate its own procedure and to make rules for that purpose. The Standing Orders of the Assembly provide detailed rules to be followed during the consideration of the Estimates, and these were carefully followed in relation to the 2012 Estimates. Notwithstanding this, the Chief Justice ruled that the Assembly’s action to amend the Estimates as presented were unconstitutional. It should be emphasized that the main purpose of the budget speech, the general debate that follows, and questions raised and answers provided during the Committee of Supply sessions, is to enable the legislators to reflect on the merits of the arguments for and/or against any possible amendments to the Estimates and to take the necessary action to do so. Indeed, the use of the word “When” would suggest that the Constitution recognizes these actions.
The Chief Justice did suggest that, in view of the new configuration in the Assembly and in order to overcome any disagreement, it would be appropriate for the Minister to rework the budget instead of the Assembly. If the Assembly were to do so, in effect it would be approving its own budget. It follows that that if the Minister declines to rework the budget-based concerns expressed by the Assembly, the latter has no other option than to reject the budget in its entirety. Needless to mention, such action would precipitate a constitutional crisis.
Following the Chief Justice’s preliminary ruling, the Minister went ahead and restored the original budget by authorizing withdrawals from the Consolidated Fund as well as advances from the Contingencies Fund. This action had serious implications in that it not only undermined the authority of Parliament to approve of public expenditure but it is also a violation of Article 218 of the Constitution since only an Appropriation Act can authorize the Minister to withdraw funds from the Consolidated Fund.
Chief Justice’s final ruling
On 29 January 2014, some 18 months later, the Chief Justice handed down his final ruling on the matter. The ruling reaffirmed his preliminary ruling that the Assembly does not have the power to amend the budget as presented. He also ruled that the Assembly could not rely on the Standing Orders as the basis for reducing the Estimates. In his view, such orders are not written law but merely internal domestic rules. He concluded that the Committee of Supply has acted unlawfully and unconstitutionally in purporting to reduce or cut the Estimates, and that the power of the Assembly is limited to giving or withholding its approval.
Court of Appeal’s decision
The Court of Appeal disagreed with the ruling of the Chief Justice on both counts and considered that the latter’s approach to dealing with the constitutionality of the issue was “markedly narrow and restrictive”. It also found troubling the Chief Justice’s emphasis on “the Minister’s estimates,” as a “judicial mindset” that gave rise to the conclusion that the Assembly had only two choices: approve or disapprove of the Estimates. While the appellate body acknowledged the constitutional responsibility of the Minister of Finance (or other designated Minister) for preparing and presenting the Estimates, it expressed the view that once those estimates are laid before the Assembly, “the Minister in a sense fades away.” In other words, once the Minister has presented the Estimates to the Assembly, it is the latter that has the responsibility of taking the process forward in what the appellate body described as a two-tiered process.
The Court of Appeal also disagreed with the Chief Justice that the reduction of the Estimates as presented by the Minister was outside of the constitutional remit of the Assembly. It argued that the Assembly’s main objective of examining the estimates is to determine if it would give its approval to the Estimates, as presented by the Minister. The appellate body asserted that “It would put a strain on reason and commonsense to expect that in its consideration of those estimates of expenditure the members of the National Assembly would mechanically offer their approval without question or challenge, or change to the estimates of expenditure presented by the Minister”. It further stated that “Had there been a more studied examination of the breadth of considerations inherent in the legislative deliberations antecedent to its approval of the estimates of expenditure as envisaged by Article 218 (2) of the Constitution, His Honour’s (Justice Chang’s) conclusion might have been different”.
The Court of Appeal found it baffling that the Chief Justice, “having found that the National Assembly could, by necessary implication disapprove of the entire estimates of expenditure as laid by the Minister, yet His Honour (Justice Chang) determined that such sweeping power, albeit arising by implication, did not at all involve the power to reduce those estimates…It is defeating to logic and commonsense to contend that the National Assembly could disapprove of the entire estimates of expenditure but did not have the implied power to adopt a less drastic measure, that is to reduce the estimates to a lesser sum. Such a power we feel must be essential in the determination by the National Assembly whether it should give its approval to the estimates of expenditure presented before it pursuant to the provisions of Article 218 (1) of the Constitution, or not…Examined to its fullest logical limits, the learned Judge’s reasoning is faulty and contradictory. We therefore politely disagree with His Honour’s opinion that the National Assembly in the context being considered did not have the constitutional authority to amend the estimates of expenditure presented before it by the Minister of Finance”.
The Court of Appeal concluded that the Assembly could have legitimately amended the estimates of expenditure presented to it notwithstanding its particular configuration as a result of the 2011 elections. It went on to state “It goes without saying that with a democratic culture underpinning the procedures of the National Assembly, the power of the National Assembly to amend the Minister’s estimates must be dependent upon a majority vote to do so”. The appellate body further noted that after the amendments to the Estimates were made and the sittings of the Assembly resumed, the Minister of Finance had informed the Assembly that: (a) the Committee of Supply considered the Estimates and approved of them as amended; and (b) Cabinet had indicated its consent that the Assembly proceed with the Appropriation Bill and its accompanying amended schedule. Accordingly, the Court of Appeal expressed its surprise that the then Attorney General sought a judicial review of the matter.
