Role of the Central Government in the Financing of Public Institutions
• The communication channel is longer; • The relationship is more distant and formal; • This is not a true representative democratic situation.
The Imposition of Taxes and the Allocation of Funds
Only The Legislature may impose (force upon) tax. Do not forget that the voter-cum-taxpayer places The Legislature in power, and in a sense, therefore, has the power. Not only does The Legislature impose tax but it also allocates the funds that arise from taxation. There are many public service departments all competing for funds (Module 1) and the decision as to whom should receive funds and how much those funds should be remains a political decision and takes place in a political arena. Ultimately in a working democracy, the voter-cum-taxpayer “decides” these matters, albeit through the political representative (see Module 2 for more on a representative democracy).
The Imposition of Tax The voter-cum-taxpayer has what is called original authority in a true democracy. But as we have seen, they neither have the time nor the expertise to impose taxes or to distribute funds – this is the work of The Legislature. The registered voter therefore transfers this original authority to the legislative authority who performs these tasks on his/her behalf. Of course, in a working democracy, this means that should the political representative not carry out the wishes of the voter, the voter may then, at the next general election, vote the representative, or sometimes even the entire government out of power.
The legislative authority receives its authority from the Constitution itself. But if we consider that a constitution is approved by the voters themselves, then we may see how the last paragraph is applied. The Legislature is, sadly, often far removed from the people themselves. Because of this the legislative authority receives unlimited power to delegate its authority.
Delegate (noun) A person authorised to act as representative for another; a deputy or an agent. A representative to a conference or convention. Delegate (verb) 1. To authorise and send (another person) as one’s representative. 2. To commit or entrust to another: delegate a task to a subordinate.
It often delegates authority to tax to regional (provincial) and local government bodies. It is most important to note that it is seldom, if ever, given the authority to delegate this very important authority to any individual. To summarise then, The Legislature may delegate taxing authority to: • The Legislature at regional level (provincial councils); • The Legislature at local government level (town councils).
The Legislature may, however, not delegate this same authority to: • any political representative; • any office bearer or public official; • the administrative or executive authority at any level.
This principle is called delegatus non potest delegare and upholds the fact that any authority who has received this power may not delegate further down the political or official line. In simple terms: The buck stop here!
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