Parliamentary Consideration

Details of Provisions

Subsection (1) confers power, by subordinate legislation, to provide (a) for the transfer to the Scottish Ministers of any property belonging to a Minister of the Crown or government department or (b) for the Scottish Ministers to have rights or interests in relation to any such property (whether in connection with its transfer or otherwise). This power has to be read subject to subsection (3) which limits its scope.

Subsection (2) confers power, by subordinate legislation, to provide for the transfer to the Scottish Ministers of any liabilities to which a Minister of the Crown or government department is subject. This power has also to be read subject to subsection (3) which limits its scope.

Subsection (3) limits the scope of the order which may be made under this section by providing that it can only be made "in connection with" any transfer or sharing of functions of a Minister of the Crown by virtue of section 53, 63 or 89 or in any other circumstances in which the person making the legislation considers it appropriate to do so for the purposes of this Act.

Section 53 provides for the automatic transfer of Ministerial functions to the Scottish Ministers so far as they are exercisable within devolved competence; section 63 provides for the transfer of specific Ministerial functions to the Scottish Ministers relating to reserved matters etc and section 89 provides for an Order in Council to be made in connection with the functions relating to a cross border public authority.

Under the Transfer of Property (Scottish Ministers) Order 1999 (S.I. 1999/1104), general provision is made for the transfer of rights and interests in land and corporeal moveable property (other than excepted property) used wholly or mainly for or in connection with a transferred function i.e. a function which is transferred to the Scottish Ministers by virtue of sections 53, 63 or 89. Special provision is made for special cases.

SECTION 61: Property and liabilities of the Lord Advocate and the First Minister

Purpose and Effect

This section makes general provision relating to the property and liabilities of the Lord Advocate and of the First Minister.

General

This is the third of a series of four sections dealing with the property and liabilities of the Scottish Executive, including the First Minister and the Lord Advocate. See the general note to section 59.

Details of Provisions

Subsection (1) provides for property to be held by the Lord Advocate in that name without the need for any further designation.

Subsection (2) provides that property acquired by or transferred to the Lord Advocate shall belong to the Lord Advocate for the time being. The same applies to the liabilities of the Lord Advocate. This ensures that there is perpetual succession to such property and liabilities, which remains vested in the Lord Advocate for the time being despite the appointment of any successor.

Subsection (3) provides that, in relation to the property and liabilities of the Lord Advocate, references to the office in titles recorded in the Register of Sasines or registered in the Land Register of Scotland and in any other document (e.g. a contract) and any other documents are to be read as meaning the Lord Advocate for the time being in accordance with subsection (2).

Subsection (4) provides that any rights and liabilities acquired or incurred by the First Minister shall belong to the First Minister for the time being. It is envisaged by section 52 that statutory functions may be conferred on the First Minister alone and therefore it will be possible that he will acquire rights or incur liabilities in relation to such functions.

SECTION 62: Transfers to the Lord Advocate

Purpose and Effect

This section confers power, by way of subordinate legislation, to transfer to the Lord Advocate property and liabilities of the UK Government in connection with any transfer of functions to him or to provide him with rights or interests in such property where the property is not being transferred.

General

This is one of a series of sections dealing with the property and interests of the Scottish Executive, including the First Minister and the Lord Advocate. See the general note to section 59.

Further provision about the making of subordinate legislation under this section is to be found in sections 112 to 115 and Schedule 7. In general, the powers may be exercised by Her Majesty by Order in Council or by a Minister of the Crown by order and, in either case, the instrument is subject to annulment in pursuance of a resolution of either House of the Westminster Parliament.

This power was exercised in making the Transfer of Property (Lord Advocate) Order 1999 (S.I. 1999/1105).

Parliamentary Consideration

Details of Provisions

Subsection (1) confers power, by subordinate legislation, to provide (a) for the transfer to the Lord Advocate of any property belonging to a Minister of the Crown or government department or (b) for the Lord Advocate to have rights or interests in relation to any such property (whether in connection with its transfer or otherwise). This power has to be read subject to subsection (3) which limits its scope.

Subsection (2) confers power, by subordinate legislation, to provide for the transfer to the Lord Advocate of any liabilities to which a Minister of the Crown or government department is subject. This power has also to be read subject to subsection (3) which limits its scope.

Subsection (3) limits the scope of the order which may be made under this section by providing that it can only be made "in connection with" the Lord Advocate becoming a member of the Scottish Executive or having any retained functions or in any other circumstances in which the person making the legislation considers it appropriate to do so for the purposes of this Act. Retained functions are defined in section 52(6).

SECTION 63: Power to transfer functions

Purpose and Effect

This section enables Her Majesty, by Order in Council, to provide for the transfer to the Scottish Ministers of functions of a Minister of the Crown which are exercisable in or as regards Scotland, even although they relate to reserved matters. It also enables such functions to be shared with the Scottish Ministers or to be exercised by a Minister of the Crown only with the agreement of, or after consultation with, the Scottish Ministers.

General

Section 53 provides for the automatic transfer to Scottish Ministers of any functions of a Minister of the Crown "so far as they are exercisable within devolved competence" as defined in section 54. Most of the functions exercisable by Scottish Ministers will have transferred to them by this route.

However, there were certain functions which were exercisable by the Secretary of State for Scotland through the Scottish Office prior to devolution and which it was intended should be exercisable by the Scottish Ministers but which would not transfer to them under section 53 because they did not relate to devolved matters. This section was therefore intended to provide for the transfer of those functions and any other functions conferred upon a Minister of the Crown which it is proposed should be treated in the same way.

These functions could not, of course, be transferred automatically as in the case of section 53. It was therefore necessary to provide in this section for an order making power to identify the particular functions which were to be transferred. The section does not, however, limit the functions to be transferred to those which relate to reserved matters.

The only limitation placed upon the function to be transferred was that it had to be exercisable by a Minister of the Crown "in or as regards Scotland" and, by necessary implication, it had to be separately exercisable in or as regards Scotland. Where there is uncertainty about this, section 30(3) empowers an Order in Council to be made which would provide that specified functions are to be treated, for such purposes of this Act as may be specified (including section 63), as being, or as not being, functions which are exercisable in or as regards Scotland for further details, see the note on section 30.

Section 106 also enables provision to be made by Order in Council modifying a function exercisable by a Minister of the Crown "for the purpose of enabling or otherwise facilitating" its transfer under section 53 or 63. The Order may in particular provide for any function which is not separately exercisable in or as regards Scotland to be so exercisable - see the note on section 106.

This section also enables Scottish Ministers to share or to participate in the making of certain functions in various ways which are detailed in the subsections.

As the effect of this section was to enable Scottish Ministers to exercise functions in relation to matters which were outside the competence of the Scottish Parliament to legislate about, it is commonly referred to as "executive devolution".

Further provision about the making of the Order in Council is to be found in sections 112 to 115 and Schedule 7. It is subject to Type A procedure which means that it is subject to draft affirmative procedure in both the Westminster Parliament and the Scottish Parliament. This ensures that functions are not transferred to be exercised by Scottish Ministers without their consent and without the knowledge and consent of the Scottish Parliament. Even although the Scottish Parliament may not have any legislative competence over the transferred function, nevertheless Scottish Ministers are accountable to the Parliament for their exercise.

Parliamentary Consideration

Details of Provisions

Subsection (1) enables Her Majesty, by Order in Council, to provide for any functions, so far as they are exercisable by a Minister of the Crown in or as regards Scotland, to be exercisable:

(a)     by the Scottish Ministers instead of by the Minister of the Crown;

(b)     by the Scottish Ministers concurrently with the Minister of the Crown; or

(c)     by the Minister of the Crown only with the agreement or, or after consultation with, the Scottish Ministers.

"Functions" include any executive powers or duties, such as the power to grant licences or to pay grants and the duty to maintain registers, and the power to make subordinate legislation.

Where a function is exercisable "concurrently" with the UK Minister this means that both the Scottish Ministers and the UK Minister may exercise that function independently of each other.

Subsection (2) provides that, where an Order transfers a function to the Scottish Ministers or provides that it should be exercisable by them concurrently with the Minister of the Crown (under (a) or (b) above), then any existing requirement that the function can only be exercised with the agreement of, or after consultation with, another Minister of the Crown shall no longer apply to the exercise of the function by the Scottish Ministers, unless the Order expressly provides that it should continue to apply. A requirement to consult a person other than a Minister of the Crown will continue to apply.

This is similar to the effect of section 55 in relation to functions transferred under section 53.

Subsection (3) provides that, where an Order transfers a function to the Scottish Ministers or provides that it should be exercisable by them concurrently with the Minister of the Crown (under (a) or (b) above), then the Order can impose a requirement for the function to be exercisable by the Scottish Ministers only with the agreement of, or after consultation with, a Minister of the Crown or other person.

PART III: FINANCIAL PROVISIONS

SECTION 64: Scottish Consolidated Fund

Purpose and Effect

The purpose of this section is to make provision for a Scottish Consolidated Fund and for:

(a)     sums to be paid into the Fund by the Secretary of State from time to time, out of monies provided by Parliament (i.e. the Parliamentary grant);

(b)     sums received by an office-holder in the Scottish Administration to be paid into the Fund subject to any provision made by, or under, an Act of the Scottish Parliament for the disposal of, or accounting for, such sums;

(c)      sums to be paid to the Secretary of State, by the Scottish Ministers in respect of certain receipts designated by order of the Treasury, and for these sums to be charged on the Fund; and

(d)     the Fund to be held by the Paymaster General.

General

Section 65 deals with the circumstances in which sums may be paid out of the Scottish Consolidated Fund, and the purposes for which such sums may be applied. Section 119 makes general modifications of enactments including modifications for the purpose of ensuring that sums are, where appropriate, paid into or out of the Scottish Consolidated Fund instead of the UK Consolidated Fund or National Loans Fund.

Paragraph 4 of Schedule 4 allows the Scottish Parliament to modify some parts of the Scotland Act in relation to the Scottish Consolidated Fund.

For the financial year 1999/00, transitional financial arrangements were made by S.I. 1999/441 and 3273 and transitional appropriations by S.I. 1999/674, S.S.I. 1999/175 and S.S.I. 2000/69. Financial arrangements are now regulated by and under the Public Finance and Accountability (Scotland ) Act 2000 (asp 1).

Parliamentary Consideration

Details of Provisions

Subsection (1) establishes a Scottish Consolidated Fund.

Subsection (2) requires the Secretary of State from time to time to make payments into the Fund out of money provided by Parliament of such amounts as he may determine (i.e. the Parliamentary grant). There is no provision for the Secretary of State to make an order determining the sums to be transferred. Parliamentary approval will be granted by the normal means of approving estimates, through the annual Appropriation Act and the various Consolidated Fund Acts.

Subsection (3) provides, subject to subsection (4), for sums received by an office-holder in the Scottish Administration (as defined in section 126(6)) to be paid into the Fund.

Subsection (4) enables the Parliament, through such provision as may be made by or under an Act of the Scottish Parliament, to authorise the retention of receipts by any office-holder in the Scottish Administration to set against expenditure. This is so as to enable the Scottish Parliament to make equivalent arrangements as apply to the UK Consolidated Fund whereby provision can be made by the UK Parliament for sums to be appropriated in aid of the sum voted. It will also enable the Scottish Parliament to make arrangements for net accounting of receipts in certain circumstances. Such provision was made in the Public Finance and Accountability (Scotland) Act 2000 (asp 1); section 7 enables receipts to be applied in connection with relevant authorised expenditure and section 9 enables the Keeper of the Registers of Scotland to retain his receipts and apply them towards his expenditure.

Subsection (5) provides that the Treasury may, after consulting with the Scottish Ministers, by order designate receipts of any description specified in the order which are payable into the Fund, as receipts to be paid to the Secretary of State. Further provision about the making of this order is to be found in sections 112 to 115 and Schedule 7.

This power was exercised in making the Scotland Act 1998 (Designation of Receipts) Order 2000 (S.I. 2000/687) which designated, with effect from 1 April 2000, certain receipts for this purpose.

Subsection (6) provides that the Scottish Ministers shall make payments to the Secretary of State at such times and by such methods as the Treasury may from time to time determine, of sums equal to the amount outstanding in respect of designated receipts.

The purpose of subsections (5) and (6) is to ensure that certain receipts (such as interest payments, fines, return on public dividend capital) which are currently paid into the UK Consolidated Fund continue to be paid into that Fund after devolution by the Scottish Ministers, through the Secretary of State.

Subsection (7) provides that amounts required for the payment of sums under subsection (6) shall be charged on the Fund so that they can be paid out without first requiring the approval of the Scottish Parliament.

Subsection (8) provides that the Fund shall be held with the Paymaster General.

SECTION 65: Payments out of the Fund

Purpose and Effect

The purpose of this section is to set out the circumstances in which sums may be paid out of the Scottish Consolidated Fund.

In addition, the section provides that sums paid out of the Scottish Consolidated Fund must not be applied for any purpose other than that for which they were charged or paid out.

General

This section is one of three dealing with the Scottish Consolidated Fund. Section 64 establishes the Fund, provides for sums to be paid into it by the Secretary of State and, subject to provision made by the Scottish Parliament for disposal of or accounting for such sums, for receipts of the Scottish Administration to be paid into it. It also states that the Fund is to be held with the Paymaster General and makes arrangements for certain receipts, designated by the Treasury, to be paid by the Scottish Ministers to the Secretary of State.

Section 119 makes general modifications of enactments including modifications for the purpose of ensuring that sums are, where appropriate, paid into and out of the SCF instead of the UK Consolidated Fund or the National Loans Fund.

Parliamentary Consideration

Details of Provisions

Subsection (1) provides that a sum may only be paid out of the Scottish Consolidated Fund if:

(a)     it has been charged on the Fund by any enactment;

(b)     it is payable out of the Fund without further approval by virtue of this Act;

(c)     it is paid out for or in connection with any of the purposes mentioned in subsection (2) in accordance with rules made by or under an Act of the Scottish Parliament. These rules will provide the procedure by which the Scottish Parliament will approve expenditure from the Fund.

The first of the above categories covers cases where it is provided that sums may be charged on the Scottish Consolidated Fund such that they can be paid out without the need for specific appropriation by the Parliament for that purpose (i.e. where they have been charged on that Fund by or under an Act of the UK Parliament including this Act and any existing Act modified by section 119 or by, or under, a later Act of the Scottish Parliament). This procedure is used for such expenditure as judicial salaries as well as payments to the Secretary of State in respect of loans (see sections 66 and 71).

The second category covers provisions in existing Acts of the UK Parliament which, by virtue of section 119, have effect as if they provided for the sums to be paid out of the Scottish Consolidated Fund without further approval of the Scottish Parliament. This is similar to a charge on the Fund.

The third category covers all other cases and is expected to cover the largest part of the expenditure met out of the SCF. As from 1 April 2001, the rules in accordance with which sums can be paid out of the SCF under section 65(1)(c) are provided for in sections 4-6 of the Public Finance and Accountability (Scotland) Act 2000 (asp 1) - see S.S.I. 2000/10. Under that Act, in general, sums can only be paid out of the SCF in any financial year if they have been authorised by a Budget Act (apart from special provision for emergencies and contingencies) and in accordance with a credit granted on the SCF by the Auditor General for Scotland (see sections 69 and 70).

The position for the financial year 1999-2000 was governed by transitional orders under the Scotland Act - see S.I. 1999/674, as amended by S.S.I. 2000/69 and 175. The position for the financial year 2000-2001 was governed by the Budget (Scotland) Act 2000 (asp 2) and a transitional order under the Public Finance and Accountability (Scotland) Act 2000 - see S.S.I. 2000/46.

Subsection (2) defines the purposes for which sums may be paid out of the Fund under subsection (1)(c), namely:

(a)     meeting expenditure of the Scottish Administration; or

(b)     meeting expenditure payable out of the Fund under any enactment.

Subsection (3) makes provision that a sum paid out of the Scottish Consolidated Fund must not be applied for any other purpose than that for which it was charged, or paid out.

SECTION 66: Borrowing by the Scottish Ministers, etc.

Purpose and Effect

This section enables Scottish Ministers to borrow from the Secretary of State sums that are required for meeting temporary shortfalls of cash, or for providing a working balance, in the Scottish Consolidated Fund. In addition, it provides that any sums borrowed from the Secretary of State under this section shall be repaid to him under such terms as the Treasury may from time to time determine. Amounts required for repayment (of principal and interest) are charged on the Scottish Consolidated Fund. The section also prohibits members of the Scottish Executive from borrowing except under this section or under any specific power in an Act of Parliament.

General

This section, together with section 67, puts in place arrangements for short-term borrowing by the Scottish Executive to cover deficits or to provide a working balance in the Scottish Consolidated Fund. This section deals with the circumstances under which the Scottish Ministers may borrow from the Secretary of State and arrangements for repayments. Section 67 deals with lending by the Secretary of State for such sums as are required by him for making loans under section 66.

Parliamentary Consideration

Details of Provisions

Subsection (1) provides that the Scottish Ministers may borrow from the Secretary of State sums required by them for the purpose of:

(a)     meeting a temporary shortfall in the Scottish Consolidated Fund; or

(b)     providing a working balance in the Fund

Subsection (2) provides that amounts required for the repayment of, or the payment of interest on, sums borrowed under this section shall be charged on the Scottish Consolidated Fund. This broadly mirrors the arrangements in relation to the UK Consolidated Fund. The purpose of charging repayments, or the repayment of interest, on the Scottish Consolidated Fund is to allow the payments to be made without the need for any annual authorisation by the Scottish Parliament under its appropriation and supply procedure to be provided by the rules under section 65(1)(c).

Subsection (3) provides that sums borrowed under this section shall be repaid to the Secretary of State at such times and by such methods, and interest on them shall be paid to him at such rates and at such times, as the Treasury from time to time determine.

Subsection (4) provides that a member of the Scottish Executive may borrow money only under this section or under any power conferred by any other Act of Parliament. This has the effect of prohibiting borrowing by members of the Scottish Executive unless specifically provided for by an Act of the UK Parliament. The Scottish Parliament is not able to confer any additional borrowing power on the members of the Scottish Executive.

SECTION 67: Lending by the Secretary of State

Purpose and Effect

The purpose of this section is to enable the Treasury to issue to the Secretary of State, out of the National Loans Fund, such sums as are required by him for making loans to the Scottish Ministers under section 66 (i.e. short term loans to meet shortfalls or to provide a working balance in the Scottish Consolidated Fund). The section also sets a limit on such short term borrowing of £500 million, but provides that the Secretary of State may, with the consent of Treasury, increase this amount by order. Repayments received by the Secretary of State under section 66 are to be paid into the National Loans Fund.