House of Commons risks major clash with the Lords over Welfare Reform Bill


3 February 2012: for immediate release

By asserting such wide claims of financial privilege in rejecting the Lords amendments to the Welfare Reform Bill, the House of Commons risks stoking opposition in the Lords, both to the bill, and to the government’s wider plans for Lords reform.  Today Dr Jeff King, Senior Law Lecturer at University College London, has published a detailed analysis of the Commons’ claims of financial privilege, and their implications.

Dr King said: “The historic origin of financial privilege is the Commons’ control of taxation. But it applies also to public expenditure. In recent years it has been invoked over pensions legislation, planning and personal care.  What is unusual in this case is the wide claim of privilege, which renders nugatory the detailed scrutiny of the Welfare Reform Bill in the Lords.  Peers on all sides feel they are wasting their time if their amendments are rejected out of hand in this way”.

“The Lords has the clear right not to accept the Commons assertion of privilege without a protest” Dr King continued.  “At risk is the Lords’ future scrutiny of legislation on health care, education, tuition fees, pensions, social security, legal aid, prisons – the whole of social policy.  At the least one hopes the Lords will respond that they do not consent to the Commons’ use of financial privilege on this bill constituting a precedent. At the most, they might even reject the Welfare Reform Bill in its entirety, forcing the government to re-introduce the bill next session and pass it without the consent of the Lords under the Parliament Acts”.

House of Lords expert Dr Meg Russell, Deputy Director of the Constitution Unit, added that the current row has important implications for Lords reform. She said “The government are currently consulting on a draft bill on Lords reform, which Nick Clegg wants introduced into parliament later this year. But one of the biggest problems with the draft bill is that the government claims it is possible to turn the Lords into an elected chamber without clarifying its powers. Many believe that an elected chamber would be more assertive, and that the powers therefore need writing down. What these events show is how unclear the limits of the Lords power can be on key policy matters. Judging financial privilege on amendments is a shadowy business, reliant on convention rather than clear-cut law”.

As a consequence, she suggested “This episode creates two major problems for the government on Lords reform: first, it strengthens arguments from those who believe that any reform bill must set out the Lords’ powers far more clearly. Second, if the Lords next week challenges the Commons’ claim of privilege, which many would argue is reasonable, this will set a new precedent for the chamber’s assertiveness. It will therefore fuel the arguments of those who fear the consequences of an even more assertive, elected second chamber. One way or another this could sound the death knell for Nick Clegg’s plans for Lords reform”.

Notes for Editors

House of Lords: Welfare Reform and the Financial Privilege

This post, by Jeff King of UCL Laws, originally appeared on the Constitutional Law Group blog

On 1 February 2012, a committee of the House of Commons resolved that the Welfare Reform Bill, which proposes to cap benefits for most families at £26,000 a year, engages the financial privilege of the Commons.  Under such a privilege, the Commons is entitled to ‘disagree’ with any Lords amendment and ultimately reject it without feeling obliged to provide any reasons other than the existence of the privilege.  By convention, the Lords will accept this determination (though increasingly with protest). I argue below that it would be a mistake to read the financial privilege so broadly, and also that the Lords have both the constitutional power, and good cause, to assert themselves in reply.

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