Category: Constitutional Law | Read Time: 6 Minutes
The "Power of the Purse": A Student's Perspective
As law students, we spend a lot of time reading about the balance of power between institutions. But nothing tests that balance quite like money. Every year around June, when the Federal Budget is presented in Pakistan, you’ll notice the political temperature rising. You might hear Senators complaining that their recommendations were ignored, or opposition members shouting in the National Assembly.
When I first started studying Constitutional Law, I found financial procedure confusing. Why does the National Assembly have so much more power than the Senate when it comes to money? Why can't a private member just propose a bill to print more currency?
The answers lie in Article 73 and Article 74 of the Constitution of Pakistan. These aren't just dry procedural rules; they determine who holds the "wallet" of the nation. Let’s break these down from a student's perspective so you can ace your exams and understand the news better.
Article 73: Procedure with Respect to Money Bills
Introduction: Who Controls the Cash?
In a parliamentary democracy like Pakistan, the "Lower House" (National Assembly) is directly elected by the people. Therefore, the Constitution dictates that the people's representatives should control the people's money.
Article 73 establishes the supremacy of the National Assembly over the Senate regarding financial matters. Unlike regular laws, which need to be passed by both houses, a Money Bill has a special express lane. The Senate acts only as an advisor here, and even then, on a very tight deadline.
Text of Article 73
73. Procedure with respect to Money Bills.
1[(1) Notwithstanding anything contained in Article 70, a Money Bill shall originate in the National Assembly: Provided that simultaneously when a Money Bill, including the Finance Bill containing the Annual Budget Statement, is presented in the National Assembly, a copy thereof shall be transmitted to the Senate which may, within fourteen days, make recommendations thereon to the National Assembly.]
1[(1A) The National Assembly shall consider the recommendations of the Senate and after the Bill has been passed by the Assembly with or without incorporating the recommendations of the Senate, it shall be presented to the President for assent.] 3* * * * * *
(2) For the purposes of this Chapter, a Bill or amendment shall be deemed to be a Money Bill if it contains provisions dealing with all or any of the following matters, namely:__
(a) the imposition, abolition, remission, alteration or regulation of any tax;
(b) the borrowing of money, or the giving of any guarantee, by the Federal Government, or the amendment of the law relating to the financial obligations of that Government;
(c) the custody of the Federal Consolidated Fund, the payment of moneys into, or the issue of moneys from, that Fund;
(d) the imposition of a charge upon the Federal Consolidated Fund, or the abolition or alteration of any such charge;
(e) the receipt of moneys on account of the Public Account of the Federation, the custody or issue of such moneys;
(f) the audit of the accounts of the Federal Government or a Provincial Government; and
(g) any matter incidental to any of the matters specified in the preceding paragraphs.
(3) A Bill shall not be deemed to be a Money Bill by reason only that it provides__
(a) for the imposition or alteration of any fine or other pecuniary penalty, or for the demand or payment of a licence fee or a fee or charge for any service rendered; or
(b) for the imposition, abolition, remission, alteration or regulation of any tax by any local authority or body for local purposes.
(4) If any question arises whether a Bill is a Money Bill or not, the decision of the Speaker of the National Assembly thereon shall be final.
(5) Every Money Bill presented to the President for assent shall bear a certificate under the hand of the Speaker of the National Assembly that it is a Money Bill, and such certificate shall be conclusive for all purposes and shall not be called in question.
Critical Analysis: Decoding Article 73
This Article is the backbone of financial legislation in Pakistan. Here is the breakdown of what you just read:
- The National Assembly’s Dominance: The most critical point is in Clause (1). A Money Bill must originate in the National Assembly. The Senate is sent a copy, but they only have 14 days to make recommendations. The National Assembly is not bound to accept these recommendations. They can pass the bill with or without the Senate's input. This effectively gives the National Assembly a monopoly on taxation and spending.
- Defining a "Money Bill": Not every bill involving money is a "Money Bill." Clause (2) gives us a strict list (items a–g). Generally, it covers:
- Taxes (imposing or abolishing them).
- Government borrowing (loans/guarantees).
- Custody of the Federal Consolidated Fund.
- What is NOT a Money Bill? Clause (3) clarifies that just because a bill involves fines (like a traffic ticket) or license fees, it doesn't automatically become a Money Bill. Furthermore, taxes imposed by local authorities (like a distinct council tax) do not fall under this constitutional definition.
- The Speaker's Final Word: Who decides if a bill is a Money Bill? The Courts? The President? No. Clause (4) and (5) state that the Speaker of the National Assembly decides. Once the Speaker signs a certificate stating, "This is a Money Bill," that decision is final and cannot be challenged in any court. This protects the legislative process from judicial interference.
Article 74: Federal Government’s Consent Required
Introduction: The Gatekeeper of Finance
Imagine if every Member of Parliament (MP) could propose a bill to build a university in their specific village using federal money. The budget would collapse in a day! To prevent this chaos and ensure fiscal discipline, the Constitution puts a lock on the treasury.
Article 74 acts as that lock. It ensures that no bill involving significant spending or currency changes can be introduced without the explicit permission of the Federal Government.
Text of Article 74
74. Federal Government’s consent required for financial measures.
A Money Bill, or a Bill or amendment which if enacted and brought into operation would involve expenditure from the Federal Consolidated Fund or withdrawal from the Public Account of the Federation or affect the coinage or currency of Pakistan or the constitution or functions of the State Bank of Pakistan shall not be introduced or moved in 1[Majlis-e-Shoora (Parliament)] except by or with the consent of the Federal Government.
Critical Analysis: Why Consent Matters
Article 74 is short but incredibly powerful. It serves as a check against "financial populism." Here is why it matters:
- Protecting the Consolidated Fund: The Federal Consolidated Fund is the main pot of money for the government (taxes, revenues, loans). Article 74 states that if a bill involves taking money out of this fund, you cannot introduce it in Parliament unless the Federal Government (the Executive/Cabinet) consents to it.
- State Bank and Currency: It’s not just about spending. This Article also protects the monetary system. Any bill that affects the coinage, currency, or the State Bank of Pakistan requires prior government consent. This ensures that monetary policy remains stable and isn't subject to random legislative experiments.
Key Takeaways
For quick revision, here are the main points you need to remember for your exams:
- Origin: Money Bills can only originate in the National Assembly (Article 73).
- Senate's Role: The Senate has a purely advisory role and must respond within 14 days.
- Speaker's Power: The Speaker of the NA has the final authority to certify a Money Bill; this certificate cannot be challenged in court.
- Government Consent: You cannot introduce a bill involving expenditure or currency changes without the Federal Government's consent (Article 74).
- Exclusions: Fines, fees for services, and local taxes are generally not considered Money Bills.
Practical Example: The "Luxury Watch Tax"
Let's apply these Articles to a real-life scenario to see how they work.
The Scenario:
The Federal Government decides to impose a new tax on imported luxury watches to increase revenue.
- Creation: The Ministry of Finance drafts the bill. Because it involves the "imposition of a tax" (Article 73(2)(a)), it is classified as a Money Bill.
- Consent: Before going to Parliament, the Federal Government formally consents to the financial measure (Article 74).
- Introduction: The Bill is presented in the National Assembly. A copy is sent to the Senate simultaneously.
- Senate Review: The Senate reviews it. They suggest, "Maybe we should lower the tax rate." They send this recommendation back within 10 days.
- Final Vote: The National Assembly reads the recommendation but decides to ignore it. They vote to pass the bill as originally written.
- Assent: The Speaker certifies it is a Money Bill (Article 73(5)). It goes to the President, who must sign it. The tax becomes law.
This process ensures that the elected government can manage the economy efficiently without being deadlocked by the Senate or overwhelmed by private spending bills.
If you found this guide helpful for your LLB studies, explore more breakdowns of the Constitution of Pakistan on our blog. Have questions about the legislative process? Drop a comment below!
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