Legislative Council

LC Paper No. CB(1) 45/98-99

Ref: CB1/R/1/1

Paper for the House Committee meeting
on 24 July 1998

Committee on Rules of Procedure

Procedure in dealing with the introduction of Members' Bills
as provided in Article 74 of the Basic Law and
the interpretation of Article 48(10) of the Basic Law

Purpose

This paper outlines the deliberations of the Committee on Rules of Procedure on the Department of Justice's opinion that certain provisions in the Rules of Procedure of the Legislative Council contravene Article 74 of the Basic Law. It also provides background information on the issues considered when formulating rules governing the presentation of bills by Members and the moving of motions and amendments by them.

Background

2. Article 74 of the Basic Law provides that Members of the Legislative Council may introduce bills in accordance with provisions in the Basic Law and legal procedures. Bills which do not relate to public expenditure or political structure or the operation of the Government may be introduced individually or jointly by Members of the Council. The written consent of the Chief Executive shall be required before bills relating to Government policies are introduced.

3. The requirements in Article 74 are reflected in Rule 51 (Notice of Presentation of Bills) in particular subrules (3) and (4) of the Rules of Procedure of the Legislative Council, as reproduced in Appendix I.

4. The Rules of Procedure, made by the Council on 2 July 1998, were drawn up after a series of discussions by Members (then Members-elect) in June 1998. During the discussions, Members were aware that further deliberations on the scope of restrictions arising from Article 74 on Members' Bills, motions and amendments were required. However, in order to provide a set of procedures for the immediate functioning of the Council, Members agreed that for the purpose of reflecting the requirements under Article 74, the provisions in Rule 51 (3) and (4) would suffice. Members also agreed to adopt the same requirements, being self-imposed restrictions to govern motions, amendments to bills and amendments to motions with "charging effect", as those applied to the former legislatures of Hong Kong in order to achieve a proper balance in the power to initiate legislative measures without contravening the Basic Law. The relevant rules, namely Rules 31, 57(6) and 69 are reproduced in Appendix II.

5. When the Council considered the Rules of Procedure on 2 July 1998, Members noted that the Solicitor-General of the Department of Justice had written to the Legal Adviser of the Legislative Council Secretariat on 30 June 1998 expressing the opinion of the Department of Justice on the scope of Article 74 and the relevance of Article 48(10) in restricting Members' motions. The letter is attached in Appendix III. Members also noted that the subject would be referred to the Committee on Rules of Procedure for further study.

6. In view of the urgency to deal with the points raised by the Solicitor-General, Members agreed at the House Committee meeting on 6 July 1998 that, pending the appointment of the Committee on Rules of Procedure, the Solicitor-General be invited to brief Members on his letter of 30 June 1998. A briefing was held on 9 July, and continued on 15 July at the first meeting of the Committee on Rules of Procedure (the Committee).

7. Members also took note of the views of the Legal Adviser of the Legislative Council Secretariat in his advice given in LC Paper No. LS6/98-99. The paper is attached in Appendix IV.

Views of the Department of Justice

8. In the opinion of the Department of Justice, a generous and purposive interpretation should be given to Article 74. The Article should cover not only bills but also Committee Stage amendments. Under the circumstances, any amendments moved by Members, whether to a bill introduced by a Member or by the Government, should also be subject to Article 74.

9. When asked by Members as to whether resolutions made under Sections 34 and 35 of the Interpretation and General Clauses Ordinance (Cap 1) to amend subsidiary legislation should also be subject to Article 74, the Solicitor-General's view is that Article 74 would not apply to such resolutions.

10. The Department of Justice is of the view that Article 48(10) should cover motions moved by Members. The Article, which spells out the powers and functions of the Chief Executive, states in (10) that one of his powers and functions is to approve the introduction of motions regarding revenues or expenditure to the Legislative Council. According to the Solicitor-General, Members may only introduce such motions, including those without legislative effect, with the Chief Executive's consent. He also argues that Rule 31, which confines the requirement for obtaining the Chief Executive's consent to motions or amendments with "charging effect", is inconsistent with the Basic Law as such a formulation is narrower than that of "regarding revenues or expenditure" as specified in Article 48(10).

11. The Department of Justice stresses that decisions as to whether certain proposals are subject to Articles 48(10) and 74 must be made by the Chief Executive. The Department takes the view that although neither article expressly identifies the decision-maker, such decisions must be made by the Chief Executive by necessary implication. For example, the question whether a bill relates to Government policies can only be decided by the very Government which formulates these policies, and the Chief Executive is best placed to decide these questions. The Solicitor-General adds that since the purpose of the articles is to restrict the powers of Members of the Legislative Council in certain specified areas falling within the purview of the Executive, this purpose would be defeated were the President given the power to make such decisions, particularly when such decisions might differ from those of the Chief Executive.

12. In conclusion, the Department of Justice is of the view that Rules 31, 51(3), 57(6), and 69 contravene the Basic Law and require amendment.

The Committee's Views

13. Regarding the interpretation of Article 74 to cover Committee Stage amendments, the Committee is of the view that nothing is written in the Article which suggests that the Article is meant for anything other than bills introduced by Members. The Basic Law is very specific in making reference to bills, motions and Members' amendments to Government bills, as illustrated in the voting procedures provided in Annex II of the Basic Law. If Article 74 were intended to cover Members' amendments to Government bills, there is no reason why it was not stated in the Article in the first place. The Committee considers it inappropriate for the Department of Justice to extend the coverage of Article 74, which governs only Members' bills, to Members' amendments to Government bills.

14. The Committee is aware of the concern of the Executive, as reflected in the Solicitor-General's opinions, that proposals in relation to those areas mentioned in Article 74 should come from the Executive instead of from Members of the Legislative Council. This principle has been spelt out in Article 74 and also reflected in the Rules of Procedure of the Council. The Basic Law has not specified detailed procedure of the legislative process, but it is clear that amendments to Government bills moved by Members are anticipated, as shown in the bicameral voting procedure in Annex II of the Basic Law and references to introduction, amendment and passage of bills in various provisions. The Committee considers it important to maintain a legislative process which allows every bill or motion before the Council to be fully debated and all aspects of the bill or motion thoroughly considered. The legislative process which the Council has now put in place is a three-reading process which has worked well in Hong Kong and which people of Hong Kong are familiar with. This process provides a stage between the second and third readings during which the Committee of the Whole Council discusses the detailed provisions of proposed amendments to a bill. A Member (including a public officer) in charge of a bill can withdraw the bill at the beginning of the proceedings for the second or third reading of the bill. If the Government finds difficulty in accepting a Government bill in its amended form, the public officer in charge of the bill may withdraw the bill before the third reading stage. The availability of the procedure to withdraw a bill provides a means for the Government to decide the final form of the proposed legislation introduced by it. Under the circumstances, it is not logical, nor reasonable, to regard arbitrarily the word "bills" in the context of Article 74 to mean also "amendments to bills" as this would deprive the Council of the opportunity to discuss and agree to proposals alternative to those proposed in a bill. The mechanism under the Rules of Procedure ensures a degree of checks and balances between the Executive and the Legislature, and preserves the principle of executive - led Government.

15. As for Article 48(10), the Committee considers that the Article, which comes under a dedicated section on the Chief Executive, is stating the powers and functions of the Chief Executive. Article 48(10) therefore refers to introduction of motions regarding revenues or expenditure to the Legislative Council by the Government, rather than those by Members of the Legislative Council. The only restrictions on Members in respect of introduction of business in the Legislative Council are provided in Article 74 which comes under the section on the Legislature. Besides, it would be illogical if the Legislative Council, with one of its functions being to debate any issue concerning public interests under Article 73(6), was disallowed to debate a motion regarding revenues or expenditure without the Chief Executive's approval.

16. On the view that the Chief Executive should be the person to decide on whether any bills are subject to Article 74, the Committee considers that since it is not specified in Article 74 as to who should be the person to decide on such matters, and since Article 75 provides the Legislative Council with the power to make its own rules of procedure, that view does not stand. It is for the Legislative Council to draw up its own procedures which on the one hand satisfy the requirements under the Basic Law, and on the other, facilitate the conduct of business of the Council in the most effective manner. The Rules as they stand do not contravene the Basic Law. If it was the intention of drafters of the Basic Law for such decisions to be made by the Chief Executive, such an important requirement would have been expressly provided. The Committee considers that referral to the Chief Executive for ruling on every bill, motion and amendment would not only upset the proper checks-and-balances between the Executive and the Legislature, but would also seriously affect the day-to-day functioning of the Legislative Council. It should also be pointed out that if the Department of Justice's arguments were to be accepted, then Article 48(10) and Article 74 would become contradictory in that the former authorizes the Chief Executive to "approve the introduction of motions regarding revenues or expenditure to the Legislative Council" while the latter prohibits the introduction of bills which relate to "public expenditure or political structure or the operation of the government".

17. The Committee has studied the powers of and inter-relationship among the Executive, the Legislature and the Judiciary as provided in the Basic Law. The provisions in the Basic Law enable the Executive and the Legislature to regulate and monitor the activities of each other, as illustrated in the functions of the two bodies and Articles 49, 50, 51 and 52. Under the Rules of Procedure, the President is empowered to take decisions on whether bills, motions and amendments to bills may be introduced into the Council. These rules are in support of the power of the President to decide on the agenda and to exercise other powers and functions as prescribed in the Rules of Procedure under Article 72(2) and (6). Any person, including the Government, who is aggrieved by a decision of the President or perceives a breach of the law by the Legislative Council may seek judicial redress.

18. The Committee has also noted that the procedure which enables the President to form an opinion as to whether a bill falls within the particular areas under Article 74 is similar to Standing Order provisions of the former Legislative Council under which the President ruled on the "charging effect" of a proposed bill or proposed amendments to a bill. These Standing Order provisions governing charging effect were made to implement Clause XXIV of the Royal Instructions, where no person was named as the authority to decide on such matters. The Committee also notes that before the President was elected by and from among Members, the Governor of Hong Kong was making the relevant rulings in his capacity as President of the Legislative Council rather than as head of the Administration. The procedure of having the President to rule on whether a question can be put at a meeting is a practice widely adopted in other common law jurisdictions. For reference purposes, the practice and procedure in other jurisdictions and in the former Legislative Council of Hong Kong are given in Appendix V.

19. The Committee affirms that Rule 51(3) and (4) does not contravene Article 74. The procedure for the President to decide whether any bills introduced by Members are related to the specific areas under Article 74 is in order. The Committee considers that the procedure should also be spelt out clearly in Rule 51(4).

20. As regards Rules 31, 57(6) and 69, the Committee maintains that these are self-imposed restrictions to govern motions and Committee Stage amendments with charging effect moved by Members. These rules are consistent with the financial procedure in other jurisdictions, as illustrated in Appendix V. Although no such requirements are stipulated in the Basic Law, they do not contravene the Basic Law. The Committee considers it reasonable to maintain such a procedure and therefore does not recommend any change to these Rules.

Conclusion

21. The Committee has come to the unanimous conclusion that the Rules of Procedure do not contravene Articles 48(10) and 74 of the Basic Law and do not require amendments. Specifically, the Committee is of the view that:

  1. Article 48(10) (the Article being on the powers and functions of the Chief Executive) only governs the introduction of motions regarding revenues or expenditure by the Government to the Council, and not motions introduced by Members of the Council;

  2. the restrictions in Article 74 apply only to Members' bills, and not Members' Committee Stage amendments to Government bills;

  3. decisions on whether bills introduced by Members fall within the confines of Article 74 should be made by the President; and

  4. the self-imposed restrictions governing motions and Committee Stage amendments with charging effect moved by Members should continue.
22. Although the Committee has not yet completed its deliberation on all the points raised by the Department of Justice, e.g. voting procedure, members of the Committee consider it necessary to provide an interim report on the issues relating to Article 74, for the information of all Members of the Legislative Council. If Members have any views on the subject, they are invited to direct them to the Committee.

Legislative Council Secretariat
22 July 1998

Appendix I

51. Notice of Presentation of Bills

(1) A Member or a designated public officer may at any time give notice of his intention to present a bill; such notice shall be sent to the office of the Clerk and shall be accompanied by a copy of the bill and memorandum required by Rule 50 (Form of Bills), and in the case of a Member, also by a certificate signed by the Law Draftsman pursuant to subrule (2).

(2) In the case of a bill to be presented by a Member, the Law Draftsman, if satisfied that the bill conforms to the requirements of Rule 50 (Form of Bills) and the general form of Hong Kong legislation, shall issue a certificate to that effect.

(3) Members may not either individually or jointly introduce a bill which, in the opinion of the President, relates to public expenditure or political structure or the operation of the Government.

(4) In the case of a bill relating to Government policies, the notice shall be accompanied by the written consent of the Chief Executive in respect of the bill.

(5) In the case of a bill presented in one official language in pursuance of a direction under section 4(3) of the Official Languages Ordinance (Cap. 5), the notice shall be accompanied by a certificate stating that the Chief Executive in Council has directed that the bill should be presented in the Chinese language or, as the case may be, the English language.

(6) In the case of a bill presented by a Member having any intention such as is described in Rule 50(8) (Form of Bills), the notice shall be accompanied by a certificate signed by the Member, stating that the bill has been published in two successive publications of the Gazette and that notice of the bill has been given by two advertisements in each of two daily newspapers published in Hong Kong, one being a Chinese language newspaper and another being an English language newspaper.

(7)     (a) Except as otherwise provided in Rule 66 (Bills Returned for Reconsideration), a bill which, in the opinion of the President, contains substantially the same provisions as another bill on which the Council has already taken a decision at second reading shall not be further proceeded with in the same session and shall be withdrawn.

    (b) If a bill which has been read for the second time is subsequently withdrawn another bill with substantially the same provisions may be presented in the same session, subject to the provisions of Rule 50 (Form of Bills), this Rule and Rule 52 (Presentation and Publication of Bills).
(8) A Member presenting a bill shall be known throughout the subsequent proceedings on the bill as the Member in charge of the bill. In the case of a bill introduced jointly by more than one Member, these Members shall designate among themselves a Member as the Member in charge of the bill at the time of presenting the bill and the Member so designated shall signify himself as such in the notice for presentation.

(9) A public officer presenting a bill shall be known throughout the subsequent proceedings on the bill as the public officer in charge of the bill; and references in these Rules of Procedure to a Member in charge of a bill include a public officer in charge of a bill.

Appendix II

31. Restriction on Motions and Amendments

A motion or amendment, the object or effect of which may, in the opinion of the President or Chairman, be to dispose of or charge any part of the revenue or other public moneys of Hong Kong shall be proposed only by -

  1. the Chief Executive; or

  2. a designated public officer ; or

  3. a Member, if the Chief Executive consents in writing to the proposal.
57. Amendments to Bills
  1. The provisions of this Rule shall apply to amendments proposed to be moved to bills in committee of the whole Council, in a select committee, and on recommittal.

  2. Notice of amendments proposed to be moved to a bill shall be given not less than 7 clear days before the day on which the bill is to be considered in committee; and except with the leave of the Chairman no amendment of which notice has not been so given may be moved to a bill.

  3. The provisions of Rule 30 (Manner of Giving Notice of Motions and Amendments) shall apply to notice of amendments to bills with the substitution of the word "Chairman" for "President" in subrule (3) of that Rule.

  4. The following provisions shall apply to amendments relating to bills:
    1. An amendment must be relevant to the subject matter of the bill and to the subject matter of the clause to which it relates.

    2. An amendment must not be inconsistent with any clause already agreed to or with any previous decision of the committee upon the bill.

    3. An amendment must not be such as to make the clause which it proposes to amend unintelligible or ungrammatical.

    4. An amendment which is in the opinion of the Chairman frivolous or meaningless may not be moved.

    5. Where an amendment is proposed to be moved to a bill presented in both official languages the amendment shall be made to the text in each language unless it is an amendment that clearly affects the text in one language only. But an amendment which creates a conflict or discrepancy between the text in one language and the text in the other may not be moved.

  5. If an amendment refers to, or is not intelligible without, a subsequent amendment or schedule, notice of the subsequent amendment or schedule must be given before the first amendment is moved so as to make the series of amendments intelligible as a whole.

  6. An amendment, the object or effect of which may, in the opinion of the President or Chairman, be to dispose of or charge any part of the revenue or other public moneys of Hong Kong shall be proposed only by -

    1. the Chief Executive; or

    2. a designated public officer ; or

    3. a Member, if the Chief Executive consents in writing to the proposal.
69. Amendments to Heads of Estimates in Committee of the Whole Council on Appropriation Bill

  1. An amendment which, in the opinion of the Chairman, would increase the sum allotted to any head of expenditure whether in respect of any item or subhead or of the head itself shall only be moved by a designated public officer.

  2. An amendment to increase a head whether in respect of any item or subhead or of the head itself shall take precedence over an amendment to reduce the head in the same respect, and if it is carried no amendment to reduce the head in that respect shall be called.

  3. An amendment to any head of expenditure to reduce the sum allotted thereto in respect of any item therein may be moved by any Member, and shall take the form of a motion "That head ...... be reduced by $....... in respect of (or by leaving out) subhead ...... item ......".

  4. An amendment to reduce a head in respect of any subhead or by leaving out a subhead shall only be in order if the subhead is not itemized.

  5. An amendment to reduce a head without reference to a subhead therein shall only be in order if the head is not divided into subheads.

  6. An amendment to leave out a head shall not be in order and shall not be placed on the Agenda of the Council.

  7. In the case of each head, amendments in respect of items or subheads in that head shall be placed on the Agenda of the Council and considered in the order in which the items or subheads to which they refer stand in the head in the Estimates.

  8. When notice has been given of two or more amendments to reduce the same item, subhead, or head, they shall be placed on the Agenda of the Council in the order of the magnitude of the reductions proposed, the amendment proposing the largest reduction being placed first in each case.

  9. Debate on every amendment shall be confined to the item, subhead, or head to which the amendment refers, and after an amendment to an item or subhead has been disposed of no amendment or debate on a previous item or subhead shall be permitted.

  10. When all amendments standing on the Agenda of the Council in respect of any particular head of expenditure have been disposed of, the Chairman shall again propose the question "That the sum for head ...... stand part of the schedule" or shall propose the amended question "That the (increased or reduced) sum for head ...... stand part of the schedule", as the case may require. The debate on any such question shall be subject to the same limitations as apply to a debate arising under Rule 68(3) (Procedure in Committee of the Whole Council on Appropriation Bill).

Appendix IV

Legislative Council

LC Paper No. LS 6/98-99

Rules of Procedure
Legal Adviser's comments on
the Solicitor General's letter of 30 June 1998

At the House Committee meeting held on 6 July 1998, Members agreed to invite the Solicitor General to a meeting to be held on 9 July 1998 to brief them on the opinion of the Department of Justice on the Rules of Procedure of the Legislative Council. The opinion is contained in the Solicitor General's letter of 30 June 1998 addressed to Legal Adviser. In order to assist Members in preparation for the meeting Legal Adviser has been requested to comment on the opinion of the Department of Justice.

2. Legal Adviser would like to point out that the issues involved are by no means simple and Members have agreed that the Committee on Rules of Procedure should start its review on the Rules of Procedure as soon as its members are appointed by the President.

Article 74

3. The Solicitor General is seeking to argue that by giving the article a generous and purposive interpretation the meaning of the word "bill" in Article 74 should include Committee Stage amendments (CSAs) to a bill. He suggests that "any other interpretation would create the anomaly that Members might achieve by way of a CSA that which they could not attain by way of a bill.".

4. In Legal Adviser's view, the principle of interpretation referred to by the Solicitor General may be understood more easily by following the approach adopted by Mortimer VP in the case of Director of Immigration v Chan Kam Nga (an infant) [1998]2 HKC 405 at 422 to 423: "The first task is to decide whether the words of the article bear a clear and plain meaning which involves neither anomaly nor absurdity. If so, that meaning must prevail and it is unnecessary to fall back upon other aids to construction.".

5. The plain reading of Article 74 does not give rise to any anomaly or absurdity. Article 74 authorizes Members to introduce bills in accordance with the provisions of the Basic Law and legal procedures. Exceptions under this authorization are bills relating to public expenditure or political structure or the operation of the government which Members are not allowed to introduce. The other exception is in respect of bills relating to government policies for which the written consent of the Chief Executive is required for introduction. It is clear that Article 74 is directed at the procedure of introduction of a bill as opposed to other possible procedures in the legislative process. The Basic Law contemplated that there would be amendments by Members to government bills, as evidenced by such reference in Annex II to the Basic Law. However, the details of procedures on amendment of bills are left to the Legislative Council to determine by way of rules of procedure.

6. On the suggested anomaly raised by the Solicitor General, it could be argued that it would be equally, if not more, anomalous if the same exceptions applied to CSAs because (given that most of the bills introduced by government would fall within one or more of the exceptions) it would deprive the Council of the opportunity to discuss and agree to proposals alternative to those proposed by government in a bill. This would raise serious doubt as to whether the Legislative Council was properly performing its constitutional function of enacting, amending or repealing laws under Article 73 of the Basic Law. The anomaly perceived by the Solicitor General may be seen as reflecting the intention of the Basic Law to leave open the question on proposed amendments to bills so that the Legislature may determine the proper checks and balances between the Executive and the Legislature through its rules of procedure.

Rules 57(6) and 69

7. In the first paragraph on page 2 of the Solicitor General's letter, it is said that Rules 57(6) and 69 do not reflect the correct interpretation of Article 74 of the Basic Law and are inconsistent with the Basic Law.

8. Rule 57(6) provides for the "charging effect" restriction on CSAs. Under that restriction any CSA which may have the object or effect of disposing of or charging any part of the revenue of Hong Kong can only be proposed by the Chief Executive (the CE), a designated public officer or a Member who has obtained the CE's consent in writing to the proposed CSA. Rule 69(3) provides for a procedure under which a Member may move an amendment to an appropriation bill by taking the form of reducing the amount allotted to a head of expenditure.

9. Rule 57(6) was not made to apply Article 74. In the Standing Orders of the previous Legislative Council, a standing order of substantially the same wording was made to implement the restriction imposed by the Royal Instructions. In the Rules of Procedure of the Provisional Legislative Council, the same provision was adopted as a 'self-imposed' restriction which Members found necessary because, in their view, which was never challenged by the Government, Article 74 did not apply to CSAs and no restriction on the moving of CSAs was found in the Basic Law.

10. As regards Rule 69, it is not clear in the Solicitor General's letter in what way it should be amended. If the suggested amendment would result in removing the procedure under which Members may amend an appropriation bill by way of reducing a proposed amount, it would mean the Legislative Council could only pass or not pass an appropriation bill (with or without amendments proposed by the Government only) when performing its function to examine and approve budgets and to approve taxation and public expenditure. This way of defining the role of the Legislative Council would be very different from that for the previous legislatures including the Provisional Legislative Council which had the same task as the current Legislative Council of examining and approving budgets, and approving taxation and public expenditure as provided in section 5(2) and (3) of the Preparatory Committee's decision to establish the Provisional Legislative Council. It may raise doubt as to whether it would upset the checks and balances between the Executive and the Legislature in the area of public financial control which have been in place for many years, both before and after the Reunification.

Application of Articles 48(10) and 74

11. The Solicitor General is suggesting that decisions as to whether a motion falls within the ambit of "regarding revenues or expenditure" as provided in Article 48(10) of the Basic Law and whether a bill falls within the areas relating to public expenditure, political structure or the operation of the government or government policies should be for the Chief Executive.

12. Under Rules 31 (relating to 'charging effect' restrictions on motion), 51(3) (relating to Article 74 restrictions) and 57(6) (relating to 'charging effect' restrictions on CSAs) of the Rules of Procedure, it is for the President to form an opinion as to whether a proposed motion, bill or CSA falls within the relevant restriction.

13. In Legal Adviser's view, even assuming that the Solicitor General's opinion as to the effect of Articles 48(10) and 74 is accepted by Members, a procedural rule which requires the President to form an opinion on the question is quite in order and would not contravene the Basic Law. The President is empowered by Article 72(2) of the Basic Law to decide on the Agenda of the Legislative Council. The power is subject only to the condition that government bills are to be given priority on the Agenda. It would, therefore, be the President's duty to determine whether a proposed motion, bill or CSA falls within the Basic Law restrictions in order to decide whether it could be printed on the Agenda.

14. While acknowledging that neither Article 48(10) nor Article 74 expressly identifies the decision-maker, the Solicitor General argues that it is by necessary implication that such decisions must be made by the CE.

15. The same argument of necessary implication could be applied in support of the requirement in the Rules of Procedure that it is for the President to form the relevant opinions. These Basic Law restrictions are imposed as part of the scheme of checks and balances between the Executive and the Legislature. Bearing in mind that the Legislative Council is specifically authorized to make its own rules of procedure, the requirement that the President form the relevant opinions could not reasonably be seen as contravening the Basic Law.

16. In terms of checks and balances, public officers may make representations to the President when there is a need for her to make a ruling and they may raise a point of order at a meeting of the Council.

17. Although not directly relevant, it should be noted that under Standing Order No. 23 of the Standing Orders of the previous Legislative Council, the President was given the authority to form an opinion as to whether a motion would have charging effect. That Standing Order was for the purpose of implementing Clause XXIV of the Royal Instructions which also did not specify the identity of the "decision-maker".

Article 48(10)

18. The Solicitor General is of the opinion that Article 48(10) of the Basic Law applies to all kinds of motions which have any effect on revenues or expenditure as well as motions which are related to other aspects of revenue or expenditure.

19. Although the Solicitor General has suggested that the formulation in Rule 31 (the 'charging effect' restriction) is much narrower and more specific than "regarding revenues or expenditure" specified in Article 48(10), Legal Adviser would like to point out that despite the textual difference it does not necessarily follow that Rule 31 contravenes Article 48 (10). The issue for consideration is whether the rule accurately implements the rather vague expression of "regarding revenues or expenditure".

20. Since all businesses of the Council are conducted by way of motion and because of the Council's functions under the Basic Law many of the motions moved by Members might fall within the ambit of "regarding revenues or expenditure". For example, a motion urging the Government to reduce tax or a motion to amend a piece of subsidiary legislation on increase of government fees. Members may wish to seek clarification from the Solicitor General as to how his opinion referred to in paragraph 19 above (see second paragraph on page 3 of the Solicitor General's letter) would reflect the proper checks and balances between the Executive and the Legislature as intended by the Basic Law.

Voting Procedure

21. Legal Adviser has provided Members with his advice on the issue. In Legal Adviser's view, the voting procedure provision in Annex II of the Basic Law has to be read as a whole. Simply singling out a certain phrase in the provision and ignoring its interaction with others could easily produce a distorted meaning.

22. In Legal Adviser's view, the wording of the provision in Annex II of the Basic Law is so clear that it would not be necessary to resort to other aids to interpretation. Nevertheless, it would be useful for Members to take note of the attached part of the speech on voting procedure given by the Mr Ji Peng-fei at the National Peoples's Congress meeting held on 28 March 1990 when moving for the adoption of the draft Basic Law. Mr Ji's explanation of the rationale and operation of the relevant provision in Annex II of the Basic Law confirms that the Rules of Procedure are not in contravention with it.

Position of the President

23. Members are aware of the so-called "anomalous outcome" described by the Solicitor General and have decided that the neutrality or impartiality of the President could only be judged by the President's own conduct. The need for counting the presence of the President under the voting procedure is dictated by the Basic Law.

24. The Solicitor General's proposal is to provide in the Rules of Procedure that the presence of the President could be discounted for the purpose of vote counting in respect of bills or motions introduced by Members if the President decided not to vote. In Legal Adviser's view, the Solicitor General's proposal should be given more thought by Members. However, there may be problems concerning the quorum requirement under Article 75 of the Basic Law if a meeting is marginally quorate with 29 Members and the President when a vote is being taken.

Encl.

Prepared by

MA Yiu-tim, Jimmy
Legal Adviser
Legislative Council Secretariat
8 July 1998

Appendix V

Rulings on Members' Bills

This note provides information on the practices in common law jurisdictions, and in the former Legislative Council of Hong Kong, with regard to rulings over Members' bills.

Practice and Procedure in other common law jurisdictions

United Kingdom

2. In the House of Commons of the United Kingdom, any Member may, having given notice and subject to being given time on the specific days allotted each session for debate on private Members' bills, present a bill. Those Members (about 20 in each session) who are successful in getting a place in an annual ballot would have their bills put down for second reading on a day of their own choice and have the bills printed. Apart from those falling within the scope of financial procedures (explained in paragraph 3 below), any Member may move any bill including one directly in conflict with some aspect of Government policy. However, a bill introduced by an Opposition Member and which does not have the support of the Government would not be expected to be given a second reading and is often designed to give publicity to a political issue. It is nevertheless one way for back-benchers to initiate debates on matters of their choice.

3. The introduction of bills or motions by Members is subject to the fundamental principle governing the financial relationship between the Crown and the Parliament: the Crown demands money, the Commons grant it, and the Lords assent to the grant; but the Commons do not authorize expenditure or seek to impose taxes unless required by the Crown. These requirements are more specifically stated in two financial rules applying to the Parliament as a whole. First, that all charges (proposals for expenditure or taxation) must be demanded or recommended by the Crown before they can be considered. Second, all charges must first be considered by the House of Commons but must also be embodied in legislation for approval by both Houses.

4. The Parliament authorizes the various objects of expenditure and the sums to be spent on each; it also authorizes the levying of taxes. The authorization of public expenditure is often referred to as "charges upon the public revenue or upon public funds", while authorization of taxation is referred to as "charges upon the people". A charge of either kind must first be considered in the form of a resolution which, when agreed to by the House, forms a necessary preliminary to the bill or clause by which the charge is authorized.

5. The rules of financial procedure are strictly observed by the House of Commons. Matters of interpretation are decided by the Speaker, or if they arise in committee of the whole House, by the Chairman. In discharging his duty to disallow any proceedings which would infringe the rules of financial procedure, the Chair relies in the last resort upon his power to decline to propose the necessary questions.

Canada

6. In Canada, the Standing Orders of the House of Commons also lay down procedures to regulate the financial relationship between the Parliament and the Crown. In gist, the relationship is as follows: " ........ the Crown demands money and Parliament grants it ........ but the Commons do not vote money unless such taxation be necessary for the public service, as declared by the Crown through its constitutional advisers."

7. In the Canadian system of parliamentary government, the Sovereign, as represented by the Governor General, and acting on the advice of His or Her responsible ministers, is charged with the management of all revenues of the State and the payment of all public expenditures. The Standing Orders of the Commons require that " This House shall not adopt or pass any vote, resolution, address or bill for the appropriation of any part of the public revenue, or of any tax or impost, to any purpose that has not been first recommended to the House by a message from the Governor General in the session in which such vote, resolution, address or bill is proposed. The message and recommendation of the Governor General shall be printed with or annexed to any bill for the appropriation of any part of the public revenue or of any tax or impost.

8. Before legislation can be brought in to implement taxation measures, a Ways and Means motion must be concurred in. Such a motion shall be forthwith decided without debate or amendment. If there is a breach of these procedures, the Speaker can decide on the matter. The Speakers of the Commons have ruled many times in the past on the "charging effect". In the case of Private Members' Bills, the Speaker sometimes takes the initiative at the time of introduction of the bill and rules the bill out of order, or the Speaker may rule the bill out of order at the later part of the proceedings, e.g. upon third reading if there has been no "Royal Recommendation", again on his own initiative or when a point of order is raised that the bill is not correctly before the House.

Australia

9. In Australia, the Parliament has the ultimate control over Government finances in that taxes are imposed and Government expenditure authorized by legislation which must be agreed to by the Parliament.

10. The Constitution stipulates that bills appropriating revenue or moneys or imposing taxation must originate in the House of Representatives (House); the Senate may not amend such bills. However, the Senate may request the House to make such amendments as the Senate itself is unable to make, and the House may, if it thinks fit, then make the amendments. The question of whether a request may be acceded to is not a strict law on which the courts will pronounce. It is a matter of constitutional propriety between the Houses themselves. If the House refuses to accede to a request, the Senate can refuse to pass the bill as a matter of law.

11. A private Member of the House may not initiate a bill imposing or varying a tax or requiring the appropriation of revenue or moneys as this would also be contrary to the constitutional and parliamentary principle of the financial initiative of the Crown, that is, that no public charge can be incurred except on the initiative of the Government. Taxation bills must be introduced by a Minister, and amendments to bills to increase the rate or widen the incidence of a proposed tax can likewise only be made by a Minister. An important point to note, nevertheless, is that any Member may move to reduce a tax proposed in a bill. The above requirements are reflected in the Standing Orders of the House.

12. The Speaker presides over the debates of the House. He is empowered to interpret the Standing Orders and precedents, deal with points of order when they are raised, and give rulings when called upon to do so.

Practice and Procedure in Hong Kong before the Reunification

13. In the former Legislative Council, the financial procedure applicable to the United Kingdom, as well as most other common law jurisdictions, also applied. The restriction that no Member could move bills, motions or Committee Stage amendments with "charging effect" was spelt out in the Royal Instructions and the Standing Orders of the Legislative Council. In the event that a Members' Bill was regarded as having a charging effect, the President reviewed the arguments put forward by the Government and the Member who introduced the Bill, and made a ruling on the Bill. Once the President had made a ruling, the decision was final.

14. As regards "charges on the people", no provision was made in the Standing Orders of the former Legislative Council to restrict Members from introducing a Bill to levy taxation.

15. Another opportunity for Members to take initiative on revenue issues was the moving of amendments to reduce the level of tax in bills or motions brought into force by Public Revenue Protection Orders made by the Governor as an interim measure.

Legislative Council Secretariat
22 July 1998