In the most recent post we discussed how the Assembly passes laws. There is a mild exception to this, and that is the budget. There a specific rules about the budget that must be followed;
1) The budget is (almost) the first thing the Assembly does each year (after an election the first step is to elect a First Senator – then the budget).
2) The budget is for the following year, not the current year.
3) The budget can only be based on money already in the Treasury – no debt, no loans, no estimates of future income. If the money isn't already in the Treasury, it can't be in the budget.
4) The budget cannot create a deficit.
5) If the Kingdom has an existing debt (from an emergency or other non-standard event) the budget must reduce the principal each year.
6) The budget can include reasonable fees, but cannot include items that would require nobles or citizens to fund them; i.e, an annual fee for a vehicle operator's license is OK, a requirement that each baron maintain a specific computer system without allocating funds is not.
7) Any budget item that lasts for more than 1 year requires a separate vote and requires a 2/3 majority to pass.
8) No budget item can last more than 6 years.
9) Pay for Senators is a separate item (if Senators are paid) and any changes don't take force until after the next election.
10) Until a valid budget is passed the Assembly does no other business.
The process of passing a budget:
1) The King submits his budget to the First Senator as the first proposal of the first conclave.
2) Unless 2/3 of Senators vote against the King's budget, it is passed and sent to the Council
3) Unless 2/3 of the members of the Council vote against the King's budget, it is passed and goes into effect.
4) If the King's budget is rejected the King or any Senator may propose alternate budgets.
Note: in an exception, even the King's budget proposal are introduced into the Senate, never the Council.
5) These proposed budgets only need a simple majority approval to be sent to the Council and a simple majority to be approved by the Council.
6) If either the Council or the King rejects two proposed budgets a Special Assembly is held where all Senators and all members of the Council meet as a single body.
A) The combined Assembly has one week to propose and approve (by simple majority of the total Assembly) a budget, If the king rejects the proposed budget or they fail to meet the deadline they meet for an additional week.
B) If a 4th budget is rejected by the King or the second deadline is missed the King dissolves the Assembly and elections for new senators are held as soon as possible.
Once the budget for the upcoming year is finalized the tax schedule for that same year as the budget is developed by the Minister of Finance (consulting with the King and the Minister of State). The Finance Minister has one month from the final budget approval to get the proposed tax schedule tot he King; the King has until the Grand Conclave to announce the final tax schedule.
While a balanced budget is not a requirement (the budget could expend less money than exists in the Treasury, after all) it does prevent deficit spending or the accumulation of government debt.