Consolidated Fund

A consolidated fund or the consolidated revenue fund is the term used for the main bank account of the government in many of the countries in the Commonwealth of Nations.

Establishment

The Consolidated Fund was so named as it consolidated a number of existing accounts, detailed below, together, and facilitated proper parliamentary oversight of the spending of the executive – it was defined as "one fund into which shall flow every stream of public revenue and from which shall come the supply of every service".

The Treasury established this account, formally known as The Account of Her Majesty's Exchequer, at the Bank of England where it remains to this day, and the legal term 'Consolidated Fund' refers to the amount of credit held in this particular account. Under the Exchequer and Audit Departments Act 1866 most of the revenue from taxation, and all other money payable to the Exchequer must be paid into the Consolidated Fund.

Earlier funds

The General Fund was established in 1617, the Aggregate Fund in 1715, the South Sea Fund in 1717. These funds were established in relation to specific Government borrowing authorised by Parliament, which had a defined type of revenue appropriated to put towards the interest and repayment. That particular revenue would be paid into the fund related to the loan. For example, the South Sea Fund was related to the debts of the South Sea Company. The Aggregate Fund was paid all the hereditary revenues of the English Crown, such as profits from the Crown Estate and the Royal Mail. The hereditary revenues of Scotland were paid into the Consolidated Fund from 1788 onwards.

Consolidated Fund Act

A Consolidated Fund Act is an Act of the Parliament of the United Kingdom passed to allow, like an Appropriation Act, the Treasury to issue funds out of the Consolidated Fund.

The typical structure of such an Act begins with the long title, which defines which financial years the Act applies to. This is followed by the preamble, which is different from the normal British public general Act of Parliament preamble in that it includes additional text before the normal preamble:

Until 2000 an older form of preamble was used:

If, as most of the Acts do, the legislation covers two fiscal years the legislation's first two sections will contain the amounts to be paid out of the Consolidated Fund for each particular financial year. The third section of the Act defines its short title. Typically two or three consolidated fund Acts are passed each calendar year.

A Consolidated Fund Act normally becomes spent on the conclusion of the financial year to which it relates.

See also