Monday 23 March 2015

Latest UK General Election Prediction by Election Trend

With a week to go before the dissolution of Parliament, the final budget from the sitting government appears to have had no impact at all on Polling, with it remaining the same statistical tie. And likewise, there's no change in the prediction, with Labour apparently on track to at least form a minority government.

What would this mean in practice?

Well, the historical precedent would be that we would see fresh elections later this year. But the Fixed-Term Parliaments Act of 2011 may well change that.

Before the Fixed-Term act, a government would face times where they must pass legislation or convention would call for the dissolution of parliament. Starting with the debate to approve the government's agenda set out by the Queen's speech on the opening of parliament. However, a strict reading of the Fixed-Term act means that none of these conventions will apply. The agenda debate following the Queen's speech will now be almost purely ceremonial, there's even an argument that they should drop it as a waste of parliamentary time. Government has a surprising ability to manage things through regulation which doesn't need parliamentary approval, there's a lot of "authorising legislation" on the books allowing Ministers a great amount of latitude. Government could implement a wide range of policy through adjustment of the wheels and levers of regulation. There's a great amount that a Government can do to govern without having to pass primary legislation.

Returning to the budget, we find the other big must-pass bill that was once a mandatory vote of confidence by convention. The budget is the principle finance bill of the year, making changes to tax income and outlining how it is expected to be spent. Other finance bills authorise government to make the spending, and were rarely ever confidence motions. Once again, the Fixed-Term act appears to remove the status of the budget debate as a confidence motion.

Oddly, this actually almost means that the government could fail to pass a budget and still survive.

Except for one thing. Income tax and Corporation tax. All other taxes are established through permanent legislation, but the bills that establish Income tax and Corporation tax both expire at the end of each fiscal year. The budget's fiscal bill passes new Income tax and Corporation tax legislation each year. Government would essentially be forced into proposing a no-confidence motion in it's self in order to dissolve parliament in time to establish a majority that could pass a budget.

As this requires cooperation from parliament, it presents a theoretical possible constitutional crisis. What happens if the opposition refuse to support the no-confidence motion? This theoretical situation could be used to start a US style fiscal-showdown to meet political demands or allow Income tax and Corporation tax to expire. Probably unlikely, but now possible.

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