methods by subsidies were rendered more efficient. The House of Commons had been familiarized with the direction of the supplies. All these innovations were after the Restoration either formally adopted, or spontaneously struck root in our system. But other novelties of the same kind soon grew up around them. In this reign we first meet with the imposition of permanent taxes.* In this reign, too, we meet with the first Parliamentary authority for the issue of negotiable public securities + bearing interest. In it the separation of the Exchequer from the Treasury was effected. In it arose, in circumstances of infinite shame, the small beginnings of our national debt. Above all in it was established the great principle of appropriating supplies. It is not my purpose to discuss the numerous questions that spring out of this subject. I merely desire to show the change that has taken place in our financial system, and the steps by which it was accomplished. That change is mainly due to the steady application of the principle of appropriation, and to the facilities for carrying into effect that principle which a fortunate alteration in the constitution of the Treasury afforded.

We have seen that in theory an aid was a voluntary donation. It therefore might be, and, in fact, it often was, altogether withheld. But when once granted it was at the absolute disposal of the King. There are very few examples in our early history of any attempt to specify the purpose for which any grant was made, and still fewer attempts to enforce the prescribed application. During the minority of Richard the Second, and again in the early part of the reign of Henry the Fourth, the subsidies were paid into the hands of persons named in the Act of + Levi's Annals, vii. 413. Hallam, Middle Ages, ii. 59, 86.

May, Const. Hist., i. 475.

Grant; and disbursements were made by these persons for the purposes for which the money was voted. But for nearly two hundred and twenty years no effort was made to control in this respect the Royal discretion. The first proposal of any such control came from the most unlikely person. It was an offer to Parliament of James the First, at the suggestion apparently of the Duke of Buckingham. The King was about to commence the war with Spain, in which the folly of his favourite had involved him; and in his own great pecuniary embarrassment he hoped that by engaging in a popular war he might succeed in obtaining without rigorous terms some assistance for his own wants. Accordingly he graciously told the Commons that the supply which he asked them to vote for the war might be paid into the hands of commissioners named by themselves. Some grants were made on similar conditions in the doubtful period of 1641; and during the Civil War and the Commonwealth the House of Commons had by its committees controlled the whole receipts and issues of the public treasury. These precedents, therefore, prepared the way for new proceedings after the Restoration. In 1665 a very large sum was asked for the Dutch war,* although in the preceding year double the amount had been granted. The fate of these moneys was more than a matter of suspicion. In order to prevent such scandals Sir George Downing, one of the Tellers of the Exchequer, carried the addition to the Subsidy Bill of a proviso that the money raised by virtue of that Act should be applicable only to the purposes of the war. The King had reason to think that he could more easily obtain advances upon such a security for speedy repayment than if no appropriation clause were inserted; or perhaps hoped that he could

Hallam, Const. Hist., ii. 355. † See Cox, Inst. of Eng. Govt., 200.

thus decently evade the repayment of the loans which he had obtained from some of the bankers. Accordingly, greatly to the vexation of Lord Clarendon, who denounced the proviso as a republican innovation derogatory to the honour of the Crown, His Majesty informed his ministers that the clause had been proposed with his sanction, and insisted that it should be retained. From that time the appropriation of Parliamentary supplies became an undisputed principle. It was recognized by frequent though not uniform practice during the reigns of Charles and of James; and from the time of the Revolution the usage has been invariable. In the bill by which their first aid was granted to William and Mary a clause, prepared after great consideration by Lord Somers at the special direction of the House of Commons, was inserted; and its substance was for many years repeated in every succeeding bill. By that clause it was enacted that out of the money in the Exchequer specified sums should be appropriated to the particular services mentioned in the Act; that all money received by collectors should be paid in due course into the Exchequer ; and that the officers of the Exchequer should be liable to severe penalties if they permitted any sum to be applied otherwise than as the Act provided. The establishment of the Consolidated Fund, of which I shall presently speak, removed the necessity for Lord Somers's famous clause. The Act* by which that fund was created provided that after payment of certain specified charges the balance should be applied to the public service under the direction of Parliament. Hence it follows that the Crown has of itself no inherent or Common Law authority to deal with that statutory fund, and, consequently, negative words+ in any Act which appropriates any part of it are mere

29 Geo. III. c. 13.

+ See Todd's Parl. Govt., i. 528.

surplusage. But, for the purpose of maintaining the constitutional control of Parliament, the Appropriation Act is never passed until the last days of the session; and some provision must necessarily be made for the interval between the expiration of the preceding financial year and the commencement of the new Appropriation Act. This provision is effected by what are called in England ways and means bills, and in these colonies supply bills. These bills grant to Her Majesty the sums therein mentioned "towards making good the services voted in the present session," and are passed in the usual way. On the faith that the recommendations of the Crown have been approved by the Commons, and upon the understanding that before the end of the session these advances will be adjusted and duly appropriated, the Upper House readily agrees that payments on account to the specified extent shall be made for

the purposes mentioned. Such acts never contain any clause of specific appropriation, and the Treasury can therefore, within the limits of the votes taken, apportion the grants at its discretion. But the word "vote" is a term of art, and implies that the resolution thereby announced ends with the current session. Hence if, as has sometimes happened, the session terminate without an Appropriation Act, there remains nothing upon which the Ways and Means Acts can operate. They are not repealed, and payments already made under them are valid. But as they are limited to "services voted in that session," and as these votes no longer exist, the grants become inoperative, and must be revoted when Parliament has again assembled.

The consequences of this principle of appropriation are very noteworthy. Its immediate effect was to necessitate the annual submission to the House of Commons of detailed * Bourke's Parl. Precedents, 50.

+ Alcock v. Fergie, 4 W. W. and A'B., 285.

estimates both of expenditure and of income. Thus the House at once acquired a general control over all the parts of that expenditure. It could criticise each particular in detail. If the information supplied to it was insufficient, it could make further inquiries. Its attention was thus specially directed to the proceedings and the general efficiency of every public department. It therefore naturally required that all public moneys should be received under its directions, and that all expenditure of such moneys should be made under its sanction. On this principle the cost of collecting the several branches of the public revenue is now no longer defrayed out of the revenue so collected. For the avowed purpose of bringing the gross income and expenditure of the kingdom under the immediate control of Parliament, a statute* of the present reign provides that the allowances and payments formerly made for the charges of collection and management shall cease to be payable out of the particular branches of revenue, and that these charges shall be defrayed out of supplies from time to time appropriated by Parliament for the purpose. In the same manner a change was effected in the mode of dealing with the revenue derived from the Crown lands. The commissioners of woods and forests were also charged with the superintendence of public works, and not unnaturally applied to the latter purpose the income which they derived from the original trust. It was therefore found expedient + to separate the two departments. The proceeds of the woods and forests are paid into the Consolidated Fund; and whatever sums are needed for public works are voted by Parliament out of the general income of the state. As the final result of many successive changes, all the public revenues and moneys borrowed are placed to one account, called the + May, Const. Hist., i. 213. Levi, On Taxation, 246.

* 17 and 18 Vict. c. 94.