All revenues of the State from whatever source arising shall, subject to such exceptions as may be provided by law, form one fund, and shall be appropriated for the purposes and in the manner and subject to the charges and liabilities determined and imposed by law.
This was considered by a Divisional Court of the High Court in Collins v Minister for Finance  IEHC 530 (26 November 2013). The Divisional Court (Kelly, Finlay Geoghegan and Hogan JJ, in a joint judgment delivered by Kelly J) concluded that Article 11, along with Articles 15, 17, 21, 22 and 28 of the Constitution, ensures that the preparation of the estimates and receipts, budgetary allocations, the raising of taxation and the appropriation of public money involves the participation of the Government, the Dáil and, in the case of the enactment of legislation, the wider Oireachtas (). In the view of the Court, these Articles not only guard against the possible excesses of spending by the Government, but also supply democratic legitimacy to the entire process of spending and appropriation (). Article 11 is an important part of that matrix; and, insofar as it provides that all revenues of the State shall form one fund, and shall be appropriated for purposes determined by law, it plainly embodies the authorisation limb of the Auckland/GSWR principle. Moreover, in Collins, the Court twice emphasised this aspect of Article 11 (emphasis added):
86. The budgetary system prescribed by the Constitution accordingly envisages that the raising of supply and the appropriation of public monies comes about by reason of the inter-action of the executive and legislative branches. … public monies may not be appropriated save by law (Article 11) …
87. While public monies may only be appropriated by law in accordance with Article 11, it is quite plain that the executive branch has in practice the dominant role in the initiation and preparation of the budgetary process. …
The plaintiff challenged the disbursement of significant State funds to two credit institutions by means of promissory notes issued by the Minister for Finance pursuant to section 6 of the Credit Institutions (Financial Support) Act 2008 (as amended by the Financial Measures (Miscellaneous Provisions) Act 2009 and the Credit Institutions (Stabilisation) Act 2010) without a separate vote in the Dáil in respect of those notes. The Divisional Court dismissed the challenge, holding that the payments were authorised by the legislation, and that the legislation was constitutional.
In this respect, Collins is very similar to the earlier Privy Council case of Ramesh Dipraj Kumar Mootoo v Attorney General of Trinidad and Tobago  1 WLR 1334,  UKPC 16 (9 April 1979). Section 85(3) of the Constitution of Trinidad and Tobago provided “No moneys shall be withdrawn from any public fund other than the Consolidated Fund unless the issue of these moneys has been authorised by an Act of Parliament.” The plaintiff challenged (inter alia) the constitutionality of disbursements pursuant to the Unemployment Levy Act, 1970, on the grounds that Auckland and section 85(3) required a separate Act of Parliament in the nature of an Appropriation Act for such disbursements. The Privy Council dismissed the challenge, holding that Auckland does not require a separate Act of Parliament and that the 1970 Act was sufficient: it authorised the Minister to make advances from the Fund for any of the purposes provided for in the Act, and no further enactment was required.
The constitutional status of the authorisation limb of the Auckland/GSWR principle is even clearer in Australia. Section 81 of the Commonwealth of Australia Constitution Act 1900 (the Australian Constitution) provides that “All revenues or moneys raised or received by the Executive Government of the Commonwealth shall form one Consolidated Revenue Fund, to be appropriated for the purposes of the Commonwealth in the manner and subject to the charges and liabilities imposed by this Constitution”. Section 83 provides that “No money shall be drawn from the Treasury of the Commonwealth except under appropriation made by law …”.
Pape v Commissioner of Taxation (2009) 238 CLR 1,  HCA 23 (7 July 2009) is the most recent affirmation that section 81 is the constitutional embodiment of the authorisation limb of the Auckland/GSWR principle. The High Court unanimously held that sections 81 and 83 of the Constitution require that the exercise of a substantive spending power must have parliamentary authorisation; French CJ placed the authorisation limb of the Auckland/GSWR principle in its historical context (-); he held that Auckland expressed the “principle of parliamentary control of public expenditure” that no money can be taken out of the Consolidated Fund without parliamentary authorisation (); and he held that section 81 “expresses the principle that parliamentary authority is required for the expenditure of any moneys by the Crown” (- at  quoting with approval Northern Suburbs General Cemetery Reserve Trust v Commonwealth (1993) 176 CLR 555,  HCA 12 (11 March 1993)  (emphasis in original)). In shorter compass on this issue (though in a much longer judgment overall), Heydon J made a similar point: section 81 “vindicates the legislature’s long-established right, in Westminster systems, to prevent the Executive spending money without legislative sanction. … It also operates so as to restrict any expenditure of the money appropriated to the particular purpose for which it was appropriated” ().
Indeed, this was a clear principle of Australian law even before Auckland and GSWR. In Commonwealth, and the Central Wool Committee v Colonial Combing, Spinning & Weaving Co Ltd (1922) 31 CLR 421,  HCA 62 (14 December 1922) (the Wool Tops case), the High Court held that the Commonwealth Executive Government could not, without constitutional or statutory authority, enter into contracts that required the expenditure of public money. Having regard to section 81, Isaac J held that
Parliament is not to be fettered in its discretion as to public expenditure by anything the Executive may do. Parliamentary discretion would be severely fettered if the Executive could make a compact binding the Crown in law to pay away portion of the public funds and leaving to Parliament the alternative of assenting to the payment or disavowing a public obligation. That would be seriously weakening the control by Parliament over the public Treasury.
In the earlier New South Wales v Commonwealth (1908) 7 CLR 179,  HCA 68 (21 October 1908) the High Court held that money appropriated to the purposes of the Commonwealth, but unspent, was not available to the States; and Griffith CJ and Isaacs J had mentioned section 81 only briefly. However, in the later Commonwealth v Colonial Ammunition Co Ltd (1924) 34 CLR 198,  HCA 5 (21 March 1924), the approach of Isaacs and Rich JJ is to the same effect as that of Isaacs J in the Wool Tops case; and his dictum in that case set out above was approved in Williams v Commonwealth (No 1) (2012) 248 CLR 156,  HCA 23 (20 June 2012) ,  (French CJ);  (Keifel J)).
Notwithstanding the Wool Tops case, subsequent cases were inconclusive in their consideration of section 81 and the first limb of the Auckland/GSWR principle. For example, in New South Wales v Commonwealth (No 1) (1932) 46 CLR 155,  HCA 7 (21 April 1932), the first limb of the principle was discussed in common law terms, even though constitutional issues also arose. And in New South Wales v Bardolph (1934) 52 CLR 455,  HCA 74 (30 November 1934) both limbs of the principle were discussed in exclusively common law terms. The following year, in Attorney-General (Vic); Ex rel the Victorian Chamber of Manufacturers v Commonwealth  HCA 31, (1935) 52 CLR 533, the majority (Gavan Duffy CJ, Evatt and McTiernan JJ) considered it unnecessary to decide the “grave question” of the ambit of section 81, although Starke J (dissenting) did discuss it briefly. In Attorney-General (Vic); Ex rel Dale v Commonwealth  HCA 30, (1945) 71 CLR 237 (19 November 1945), the High Court struck down the Pharmaceutical Benefits Act, 1944 (see also British Medical Association v Commonwealth  HCA 44, (1949) 79 CLR 201 (7 October 1949)). The reasoning in Dale is divided and unsatisfactory; only Latham CJ referred to sections 81 and 83 – and then, only perfunctorily. In Australian Woollen Mills Pty Ltd v Commonwealth (1954) 92 CLR 424  HCA 20 (4 May 1954)  the matter was not pursued.
The first case to consider section 81 from the perspective of the first limb of the Auckland/GSWR principle is Victoria v Commonwealth (1975) 134 CLR 338,  HCA 52 (29 October 1975). The High Court upheld the Australian Assistance Plan of grants to regional councils for social development. Mason J (at para  of his judgment) said that section 81 “gives expression to the established principle of English constitutional law enunciated by Viscount Haldane in Auckland“. Hence, he held that an Appropriation Act has the twofold purpose of authorising the Crown to withdraw moneys from the Treasury, and restricting the expenditure to the particular purpose for which it is withdrawn. Victoria was considered in Davis v Commonwealth (1988) 166 CLR 79,  HCA 63 (6 December 1988) but very little was said about section 81 (see  (Mason CJ, Deane and Gaudron JJ);  (Brennan J);  (Toohey J)). However, in Brown v West (1990) 169 CLR 195,  HCA 7 (1 March 1990) the High Court (Mason CJ, and Brennan, Deane, Dawson and Toohey JJ, in a joint judgment) approved Mason J’s comment in Victoria v Commonwealth (), and held that the authorisation limb of the Auckland/GSWR principle is entrenched in the Australian Constitution by sections 81 and 83, which assure to the people the effective control of the public purse (-). On the facts, the Court held that there was no statutory basis for the impugned decision to increase the postage entitlement for parliamentarians.
In Northern Suburbs General Cemetery Reserve Trust v Commonwealth (1993) 176 CLR 555,  HCA 12 (11 March 1993) the High Court put these principles in the historical context of the Bill of Rights 1698 and the Customs and Excise Act, 1787. Mason CJ, Deane, Toohey and Gaudron JJ held that section 81 reflects the establishment of the first Consolidated Fund in 1787 (at paragraph  of their joint judgment) and “expresses the principle that parliamentary authority is required for the expenditure of any moneys by the Crown” ( (emphasis in original); approved in Pape  HCA 23 (7 July 2009)  (French CJ)). Brennan J and McHugh J, concurring in separate judgments, expressly said that these sections give effect to the constitutional principle in the first limb of the Auckland/GSWR principle (see - (Brennan J); - (McHugh J). In British American Tobacco Australia Ltd v Western Australia (2003) 217 CLR 30,  HCA 47 (2 September 2003) the High Court permitted the plaintiff to continue with a claim for restitution of overpaid tax. In their joint judgment, McHugh, Gummow and Hayne JJ approved Northern Suburbs and held that Auckland “reflects the fundamental constitutional principle prohibiting the Executive Government from spending public funds except under legislative authority” (-; also  Callinan J concurring).
In Combet v Commonwealth (2005) 224 CLR 494,  HCA 61 (21 October 2005), a challenge to the government’s expenditure on an advertising campaign promoting controversial industrial relations reforms failed, on the grounds that the expenditure was authorised by an Appropriation Act (see Lotta Ziegert “Does the Public Purse have Strings Attached?” (2006) 28 Sydney Law Review 387 (pdf); John Uhr “Appropriations and the Legislative Process” (2006) 17 Public Law Review 173; Geoffrey Lindell “The Combet Case and the appropriation of taxpayers’ funds for political advertising – An erosion of fundamental principles? (2007) 66 Australian Journal of Public Administration 307). The validity of earlier similar appropriations had been questioned (Geoffrey Lindell “Parliamentary Appropriations and the Funding of the Federal Government’s Pre-Election Advertising in 1998” (1999) 2 Constitutional Law and Policy Review 21); and they would be unconstitutional in Ireland (after McKenna v An Taoiseach (No 2)  2 IR 10,  IESC 11 (17 November 1995) and McCrystal v The Minister for Children and Youth Affairs ( IESC 53 (8 November 2012 (per curiam); full reasons 11 December 2012); blogged here, here, here, here, here, here, and here).
McHugh J and Kirby J, concurring in separate judgments, rehearsed the historical background to sections 81 and 83 (- (McHugh J); - (Kirby J)) and once again affirmed the fundamental constitutional status of the first limb of the Auckland/GSWR principle (n14 (McHugh J); - (Kirby J)). Indeed, Kirby J went further, commenting that if the strong words of the Privy Council in Auckland
… could be applied in 1924 to describe the constitutional arrangements of the United Kingdom and of New Zealand, how much more applicable are they to the requirements of the Australian Constitution, expressed in a written instrument stated in imperative terms, designed to make certain, and to immure from easy change, similar British constitutional precepts? The criterion, thus endorsed by this Court, is one of “distinct authorization from Parliament itself”. To the extent that the Executive Government seeks to justify expenditures, except where there is “a distinct authorization”, it challenges centuries of constitutional history. It departs from the provisions of the Australian Constitution designed to give that history effect. It detracts from the basic purpose of such provisions, being to assure to the people in Parliament the final say about the expenditure of public moneys. It weakens accountability of the Government to the Parliament in all such matters. To conclude otherwise would be to depart from the principles endorsed in Brown v West. This Court should not retreat from the clear rule expressed in that case. Behind it stands a principle of comparative strictness required by the text of our Constitution, by centuries of history and by policies of good governance to which that text gives effect.
The most recent discussion of the authorisation limb of the Auckland/GSWR principle in the context of section 81 is Pape v Commissioner of Taxation (2009) 238 CLR 1,  HCA 23 (7 July 2009). The High Court, by a majority of 4-3, upheld the validity of one-off “tax bonuses” which ranged from Aus$250 to Aus$900, paid to taxpayers on foot of the Tax Bonus for Working Australians Act (No 2) 2009 (Cth) (see Andrew McLeod “The Executive and Financial Powers of the Commonwealth” (2010) 32 Sydney Law Review 123 (pdf); Gabrielle Appleby and Stephen McDonald “The Ramification of Pape v Federal Commissioner of Taxation for the Spending Power and Legislative Powers of the Commonwealth” (2011) 37 (2) Monash University Law Review 162 (pdf)). The majority (French CJ, Gummow, Crennan and Bell; Hayne, Kiefel and Heydon JJ (dissenting)) held that the Act was authorised by sections 51(xxxix) and 61 of the Constitution. However, the Court unanimously held that sections 81 and 83 of the Constitution do not amount to a substantive spending power in their own right, and therefore did not authorise the payment of the tax bonuses ([8.5], - (French CJ); - (Gummow, Crennan and Bell JJ); -, ,  (Hayne and Kiefel JJ); -, - (Heydon J); see also ICM Agriculture Pty Ltd v Commonwealth (2009) 240 CLR 140,  HCA 51 (9 December 2009) ; Williams v Commonwealth (No 1) (2012) 248 CLR 156,  HCA 23 (20 June 2012) , , - (French CJ);  (Gummow and Bell JJ);  (Hayne J)  (Crennan J)). Rather, having regard to the historical background, sections 81 and 83 provide for parliamentary control of public moneys and their expenditure, and in particular require that the exercise of a substantive spending power must have parliamentary authorisation (- (French CJ); - (Gummow, Crennan and Bell JJ);  (Hayne and Kiefel JJ)). This history included the Bill of Rights 1698, the Customs and Excise Act, 1787, the Exchequer and Audit Departments Act 1866, and Auckland Harbour Board v R. And, as set out earlier in this post, both French CJ and Heydon J expressly asserted that section 81 was the constitutional embodiment of the authorisation limb of the Auckland/GSWR principle (eg ,  (French CJ);  (Heydon J)).
Ireland and Australia share the same historical antecedents, which provide the background to, if not indeed the source of, similar modern constitutional provisions and parliamentary practices. This shared history (mentioned in my second post) includes the Bill of Rights 1698, the Customs and Excise Act, 1787, and twothe Exchequer and Audit Departments Act 1866, to which reference is repeatedly made in the above Australian cases. The Bill of Rights is still in force in Ireland (where it is dated 1688); the Consolidated Fund first established by the 1787 Act now has constitutional status by virtue of Article 11 (the “revenues of the state … form one fund”) and expanded upon by the Central Fund (Permanent Provisions) Act, 1965; and the office of the Controller and Auditor General first established by the 1866 Act now has constitutional status by virtue of Article 33 (which ensures that “the entire budgetary process is overseen by an independent constitutional officer” (Collins )).
The Australian cases establish that section 81 has expressly afforded the authorisation limb of the Auckland/GSWR principle a very strong constitutional basis. Given the obvious similarities, Irish law should reach the same conclusion. Two comments in Collins (set out earlier in this post) have adverted to this. They may be sufficient to conclude that Irish law has already reached the conclusion that the authorisation limb of the Auckland/GSWR has an express constitutional basis in Article 11. If they are not, then Irish law should take the first opportunity to confirm, emphatically, that Article 11 of the Irish Constitution is, like section 81 of the Australian Constitution, the constitutionalisation of the authorisation limb of the Auckland/GSWR principle. Once this is so, then the Australian cases can help to shape the contours and consequences of this conclusion. In particular, Kirby J’s constitutional musings in Combet could just as easily apply in Ireland (adapted as follows):
If the strong words of the Privy Council in Auckland and of the House of Lords in GSWR could be applied in the 1920s to describe the constitutional arrangements of the United Kingdom, how much more applicable are they to the requirements of the Irish Constitution, expressed in a written instrument stated in imperative terms, designed to make certain, and to immure from easy change, similar British constitutional precepts? The criterion in those cases is one of “distinct authorization” from the Dáil; the equivalent criterion in Article 11 is that the revenues of the State shall be appropriated only in the manner determined by law. To the extent that the Government seeks to justify expenditures, except where there is “a distinct authorization” determined by law, it challenges centuries of constitutional history. It departs from the provisions of the Irish Constitution designed to give that history effect. It detracts from the basic purpose of such provisions, being to assure to the people, via the Dáil, the final say about the expenditure of public moneys. It weakens accountability of the Government to the Dáil in all such matters. To conclude otherwise would be to depart from the Auckland/GSWR principle. Behind it stands a principle of comparative strictness required by Article 11 of Constitution, by centuries of history and by policies of good governance to which that text gives effect.
It should be concluded, therefore, that Article 11, like section 81, embodies the constitutionalisation of the authorisation limb of the Auckland/GSWR principle. Of course, this is not the only matter in those provisions, but it is an important aspect of them. In the context of whether the State could recover overpayments made to farmers under EU schemes, authorisation limb of the principle requires that, as a matter of Irish law, the payments to the farmers be authorised, and constitutionalising this limb as an aspect of Article 11 reinforces this requirement that the payments to the farmers be authorised. These overpayments are the context of this series of posts on the Auckland/GSWR principle. This is the third post in the series. In my first post, I established the principle. In my second post, I discussed the common law authorities on the first – authorisation – limb of the principle; and, in this post, I discussed the constitutional authorities on that limb. Whether at common law or under Article 11, the authorisation limb of the Auckland/GSWR principle requires that the payments to the farmers be authorised. If they are not, then the question arises under the second – restitution – limb of the principle of whether the overpayments can be recovered. I will discuss this restitution claim in my next post, the fourth in this series. The constitutionalisation of the authorisation limb strengthens the policy underlying the restitution claim in the second limb. It also raises the question under the second limb of whether unauthorised State payments not only can, but must, be recovered, and, if so, whether this precludes the operation of ordinary restitution defences. I will discuss these issues in my fifth post in this series. Penultimately, overpayments to Irish farmers are not the only context in which these restitution issues have recently been in the news. Similar overpayments to Gardaí (Irish police officers) give rise to similar issues, which will be considered in an additional footnote post. Moreover, an interesting example has recently arisen in South Africa; and I will discuss it in my sixth and final post in this series. Finally, in an addendum, I will consider whether Irish law might draw other conclusions from the Australian constitutional experience.