Executive Council approval needed if Budget breaches Constitution Act

Did government consider the provisions of S70(3) of the Constitution Act 1964?

The Appropriation Bill (Budget) which is still to pass its third reading in parliament may be illegal if passed.
The Times has learnt that this possibility was drawn to the Finance Minister’s attention on Tuesday.
The question of legality arises because since the Appropriation Amendment (Supplementary Budget) in April 2011, a deficit of just over $2 million arose in the government accounts. The Herald reported on 18 May 2011 that there was a deficit of around $1.7 million. Government had learnt on 10 May 2011 that there was a deficit and HOMs were advised on 11 May.
Under s70 of the Constitution Act 1964, if such a situation arises and the deficit exceeds 1.5 percent of the of the total amount of all sums appropriated by the Appropriation Act for that Year, a statement of the unauthorized expenditure shall be included in the accounts for that year laid before parliament.
The deficit is said to exceed the 1.5 percent benchmark. If this is the case, how did the Finance Minister and his advisors not pick this up? It may seem a minor issue but laws must be complied with.
If the Constitution Act is to be complied with, what should happen next?
Under s70(3) the Executive Council may approve the excess expenditure. This needs to take place and the Act requires that a statement of the unauthorized expenditure be included in the accounts for that year laid before parliament.
At time of going to print on Friday, Government’s response was not made public.
Provisions of the Constitution Act 1964
70 Revenue and expenditure of Cook Islands Government
Account
(1) Except as provided in subclause (3) of this Article, or by any specific appropriation contained in any enactment, all expenditure in any financial year from the Cook Islands Government Account or from any other public fund or account shall be charged to votes specified in an Appropriation Act and in accordance with the statement of proposed expenditure for that financial year as approved by the Legislative Assembly.
(2) Every Appropriation Act shall lapse at the end of the financial year to which it relates.
44 Reprinted as at 3 September 2007 Cook Islands Constitution Act 1964 Schedule
(3) Subject to such limits and restrictions as may from time to time be prescribed by any enactment, the Minister responsible for finance, or, where any enactment so provides, the Executive Council, may approve the expenditure of such sums as he or it considers necessary—
(a) In anticipation of provision to be made in the Appropriation
Act for any financial year: Provided that the total amount issued and paid under this paragraph (a) in any financial year shall not exceed the unexpended balance of the vote in the Appropriation Act for the preceding financial year together with an amount equal to one fourth of that vote; or
(b) Where during the period between the passing of the Appropriation Act for any financial year and the end of that year it is desirable that money should be expended in excess of or without the appropriation of the Legislative Assembly:
Provided that the total amount of all sums issued and paid under this paragraph (b) in any financial year shall not exceed one and a half percent of the total amount of all sums appropriated by the Appropriation Act for that year.
(4) A statement of the unauthorised expenditure for any financial year shall be included in the accounts for that year laid before the Legislative Assembly.
(5) Subject to the foregoing provisions of this Article, the collection, receipt, custody, banking, issue, expenditure, care, and management of money credited or to be credited to the Cook Islands Government Account or to any other public fund or account shall be as prescribed by enactment.

Headlines : Times 290 02 March 2009
- Lucky $1,000 winner
- Century old palm trees and the French connection
- Koutu Nui takes part in Raui meeting in Moorea
- WOM Award Dinner for Ake Hosea-Winterflood
- Island of Atiu to host Koutu Nui AGM in June 2009