[From How the IoM is governed, 1944]


The modern Tynwald Court meets to sign, and once in the year to proclaim, laws passed by the two branches meeting separately; to levy the taxes, and (subject to important limits which we are about to describe) to decide how the national revenue shall be spent; and to appoint committees to administer various defined departments of government.

In Great Britain, the Houses of Parliament do not sit together. Finance is the province of the Commons alone, and the departments of government are in charge of Ministers appointed by the Prime Minister, who receives his appointment from the King. The Ministry as a whole would resign if the House of Commons disagreed with its policy.

It is fairly easy to state the extent of the Tynwald Court's power on matters of general administration. It receives reports from the various boards, it is a liberty to discuss the whole policy of any particular board when the financial appropriation to that board comes to be voted at the beginning of the year-the same liberty as is exercised by the House of Commons-and if it is dissatisfied with the conduct of a board or any of its members, it has power, under the Constitutional Reform Act of 1919, to declare that all or any of the members whom Tynwald has appointed shall cease to hold office. Where the Governor nominates the board, as in the case of the Harbour Commissioners or, the Electricity Board or the various water boards, it can refuse to accept. the Governor's nominations. Any member has the right at any time to obtain information on any detail of administration by addressing a question to the Governor or to the chairman of a board, and if he is dissatisfied with the answer he can at a later sitting move a resolution as an expression of the Court's opinion. Where additions or enlargements of the public services are desired, the Court can pass a resolution asserting the desirability of such a step and requesting the Governor to make the necessary financial provision.

During the war the Court is influencing administration, indirectly, by appointing-in the manner described in a previous article-a War Emergency Committee, and though the committee submits no regular report, the Governor in December, 1942) promised that if members desired information on the committee's activities, they could send him questions, which would be answered at the Court's next sitting-"either in private or public session, according to the nature of the information asked for."


Tynwald's powers over finance--a question in which the Court's relations are not simply with the Governor but with the British Home Office and the British Treasury-form a much more considerable subject, which we feel ourselves obliged to discuss at some length.

In 1765, as a drastic remedy for the "mischief" of smuggling, the British Government took back the sovereignty which had been granted centuries earlier to the Stanley family, and made the Isle of Man a direct possession of the King. They "re-vested" the Island in the Crown, and for that reason the Act of Parliament passed in that year is known as the Revestment Act. As a result, the British Government levied the Customs duties-leaving them, at time, somewhat lower than those levied in England-limited the quantities of dutiable goods which might be imported, defrayed the public expenditure, and pocketed any surplus. They made a promise, to begin with, that surpluses would be spent upon harbour works and ether public improvements. It was complained that not enough was spent on harbours to meet the Island's evergrowing requirements, that the allowance of dutiable goods was insufficient, and that the licences to import were granted to a few persons who became monopolists and profiteers. Above all, the whole system was an insufferable curtailment of the Island's liberties. After a century of agitation, Tynwald's right to control expenditure was restored we shall see by no means completely-by an Act of Parliament passed in 1866. This Act, called the Isle of Man Customs, Harbours, and General Purposes Act, and extended by an Isle of Man Customs Act of 1887, which specifically gave Tynwald the right to levy Customs duties, regulates Tynwald's financial powers at the present time.

To begin with, Tynwald is permitted to pass resolutions relating to Customs duties, which operate for six months pending their being confirmed by Act of Parliament. An Isle of Man Customs Act is submitted by the British Governmont to the House of Commons every year. Secondly, the English Customs authorities, who collect all the duties levied in respect of the Isle of Man, are directed to pay to the Receiver-General of the Isle of Man the sum of 2,300 towards the maintenance of harbours. (It was enacted that a ninth part of the Customs revenue was to be applied in effecting improvements in Manx public works, harbours taking priority, and that another two-ninths might be pledged for harbour loans, and it will be seen later that the British Government considers that these hypothecations of specified parts of the revenue, even if they only exist in theory, ought to remain on the Statute Book.) Thirdly, a sum of 10,000 is paid annually to the British Government. It has been argued on the one hand that this is the Island's contribution towards Imperial defence, and on the other hand that it represents interest on the 220,000 which the crown paid to the Duke of Athol in purchase of his rights as a feudal landowner. Fourthly, the necessary expenses attending the government of the Isle of Man, and the administration of justice, must be paid according to the directions of the British Treasury. The surplus after all this (often referred to in discussions as "the surplus revenue") is left, under restrictions, to the disposal of Tynwald; it "shall be applied for such public purposes of the Isle of Man, to be approved by the Commissioners of Her Majesty's Treasury, as the Court of Tynwald shall from time to time determine, the Lieutenant-Governor having a veto on such decision."

It was pointed out by the Macdonnell Commission in 1911 that the clause in the Act of 1866 which makes the British Treasury the sole judge of what expenses are necessary to' the maintenance of government and the administration of justic-' also enables the Treasury to direct the payment of other charges incurred in the Isle which have heretofore been or may hereafter be deemed fit and proper charges to be deducted from and paid out of the duties of Customs collected in the Isle of Man." "It seems to us," said the Commission, "that the competency of H.M. Government is unquestionable . . . to direct any expenditure to be made which it thinks fit to make." But the Commission added that a strict enforcement of this law would reduce Manx self-government to a nullity, and saw no danger of its being done.


Public expenditure in the Isle of Man, then, fails into two classes-the Reserved Services, which must be paid whatever Tynwald thinks about them; and the Voted Services, on which Tynwald has the say subject to the Treasury's approval. With regard to the public revenue, it is theoretically possible that the House of Commons might throw out the Bill in Parliament which makes Tynwald's levying of Customs duties finally legal. That the Commons would put the theory into practice is highly improbable; and a statement to this effect was made by a Treasury spokesman a few years ago. Mr Norris in his book "Manx Memories and Movements" recalls how Tynwald declined to follow Parliament's example by levying a duty on wrapping paper, and when the Isle of Man Customs Bill came up in Parliament, Mr G. R. Hall Carne-a Manxman, by the way-moved that the paper duty be inserted. Speaking for the Treasury, Mr Ronald McNeill declared that the House could not alter the financial resolutions of the Manx Legislature by one comma, and though they could reject the Bill, this would be an unprecedented action which he was sure members would hesitate to take.

It might be considered that the Isle of Man Customs Bill does not come before Parliament until the Treasury has introduced it, and that if the Treasury disapproved of what Tynwald had done, it might decline to take the necessary steps for the introduction of the bill. Under the Isle of Man Customs Act of 1887, the Treasury may by Minute declare that there is no prospect of Tynwald's resolution being confirmed by Parliament, and when that is done the imposition of the duties ceases to have effect. The Treasury has not been known to take such a course; it has a much more potent weapon if, for instance, Tynwald levies duties so much lower than the English as to open the way for large-scale smuggling. In such a case the Treasury may simply intimate that it will cause the luggage of all passengers entering or leaving the Island to be examined.


The "Reserved Services," then, are what the British Treasury considers the necessary standing expenses of government and of the administration of justice. The Governor, as head of the executive, is the person who in the first instance would decide whether or not the salaries of the permanent officials, the wages of the police, the costs of running Government Othce and the law courts, ought or ought not to be increased. Sir Spencer Walpole stated that for ten years preceding the publication of his book 'The Land of Home Rule' (in 1893) the Governor-i.e., himself-had given a personal undertaking to make no addition tv the cost of government without first acquainting Tynwald, and to defer to Tynwald's decision if an objection to any proposed change was sustained on a division. Mr A. W. Moose, reproducing Walpole's statement in his "History of the Isle of Man," commented that this course had not been invariably followed by Walpole's successors.

The Macdonnell Commission thought it reasonable that, just as certain Imperial charges when once sanctioned by Acts of Parliament do not come before the House of Commons for annual criticism, so certain Insular services, "lying at the foundation of government," should not be challenged. They should constitute what the Commission recommended as Part I of the Island's annual financial statement. But in any year where an increase in such salaries and office expenses was proposed, the increase should be placed in Part II of the Estimates, and laid before Tynwald for approval. The Home Secretary of the period declined to adopt that recommendation, remarking that in practice it would be likely to lead to serious difficulties.


The controversy came to a: head early in 1920, when the House of Keys discovered that increases in salaries and wages amounting to thousands of pounds had, heen made by the previous Governor without Tynwald's knowledge. At a meeting of Tynwald the Keys carried a resolution protesting against these increases, and requesting the Governor, while reserving the rights of the British Government, to submit these increases for the consideration and approval of Tynwald. The Council preferred a much milder resolution, deleting the expressions of protest, and appointing a committee to confer with the Governor on the cost of the Civil Services and to take into consideration the general subject of ilie constitutional relations between the Isle of Man and the British Government, and in the end both resolutions fell. The Keys then embarked upon a memorable "strike," and refused to meet in Tynwald until their right to consent to increases in salaries had been recognised. Meeting in their own chamber, they :appointed a deputation to interview the Home Secretary.

The result of this interview was a new decision by the British Government, embodied in a Home Office minute. The Home Secretary proposed, and later on the House of Keys agreed, that before preparing his Budget the Governor should communicate confidentially to both branches an outline of his proposals for the expenditure of the year, and that the two Houses should consider these proposals and return them with such, suggested modifications as they might desire. If agreement could not be reached, the Governor was to refer the question to the British Government. These, arrangements for preliminary discussion would apply in respect of increases , both to, the Reserved Services and the Voted Services. It was suggested in this Minute that the Budget proposals might be laid before either the whole legislative branch, the Council or the Keys, or before a committee acting on its behalf. The Keys promptly established a Finance Committee, and the practice as developed in the regime of Governor Butler is described in the report of a committee of the Keys, appointed in 1937 to consider possible modifications in the appointment of the Governor. The Governor meets the committee each year and puts before them the proposals presented to him by boards of Tynwald and other public authorities. The committee are free to, suggest amendments or alternatives, and the Governor takes note of their opinions. Some weeks later, when he knows the approximate amount of the surplus for the year just completed, and knows what sum is available for new expenditure, he meets them again, and is willing to receive suggestions from them in his final estimates. A little later the estimates are sent to the committee, who go through them, in conjunction with the Government Secretary. The committee then report to the House in private, and the observations of the House are conveyed to the Governor. Consultation also takes place when increases in expenditure are considered necessary between one Budget and another.

No such committee has been appointed by the Council, whose membership is ten altogether, and whose practice is to, sit with the Governor.


This submission of the official proposeals for expenditure represents a landmark in the Island's constitutional history. It is not the general Advisory Committee which the Keys asked for in the Reform petition of 1907, and not even the Finance Committee of Tynwald which was suggested by the Macdonnell Commission; and increases in the Reserved Services can still be made without the Legislature's consent, though no longer without the Legislature's knowledge. It is a great gain, however, that the branches of the Legislature are enabled to express their opinions, and the clear intention is that such opinions should have an operative effect. There is the obvious possibility, of course, that the two branches may give contrary opinions.

Except for that phrase in the Act of 1866 giving the Treasury the right to direct the payment of charges "which may hereafter be deemed to be fit and proper," Tynwald's right to oppose suiocessfully any proposed expenditure in the Voted Services appears to be absolute. If the Governor finds in these preliminary discussions that certain proposals are unacceptable, he would place them on the Tynwald agenda at his peril. The post-1920 procedure protects him from the indignity of having his proposals publicly defeated. Likewise it saves the branches the indignity of being asked to levy new taxes or sanction new expenditure at a moment's notice.


The Minute directed the Governor to submit to preliminary examination his proposals for expenditure. It was contended in April, 1943, that there was no :obligation upon him to submit propo~sals for taxation. Normally, taxation proposals would be included in the draft Budget, but this was an occasion when tchere taiMn aninxcrBeuasdegs et in wacs ertnaoin reaadey hbaud t been decided upon in the English Budget, and the Governor may have assumed that, for the sake of preventing smuggling and of keeping within the system which is called "the Common Purse''-by which goods come into the Island duty-paid, and the British Government pays the Isle of Man a share of the British Customs revenue, based on the proportion between the Manx population and the population of Britain and Man together-Tynwald would follow this decision as a matter of course. The Keys objected to these taxation proposals being placed on the Tynwald agenda when their Finance Committee had not been informed or consulted, and by "going on strike" once more they secured from the Governor a promise that for the rest of his term of office the Home Secretary's minute would be read as if the expression "proposals for expenditure" included "proposals for taxation."


We have made it clear that every ex penditure resolution passed by Tynwald has to await Treasury approval before it can come into effect. It has been sometimes complained that the examination of these resolutions is "close and meticulous"; on other occasions it is argued that the Treasury desires not to interfere but to advise, and tribute is often paid to the guidance which the Island receives from experts in all forms of British administration. The point remains that Treasury control is a derogation of Manx self-government.

An alternative of this system was sought, but in vain, when Tynwald was considering the amount of the Island's war contribution. In 1923 a committee presided over by that distinguished Conservative Mr J. D. Clucas presented a report containing the following passages:

"The present system whereby Customs duties of the Isle of Man are, imposed by Act of Parliament, and the approval of the Treasury has to be obtained to financial votes of Tynwald, and further that the Treasury has the sole right of determining the expenses of the government of this Island even allowing for the good will of the Imperial Government and the concessions recently made by the Home Secretary-leaves the Isle of Man in a position incompatible with the status of a free state, and results in inconvenient delays.

"The committee recommend that as a condition of the grant, the control of the finances of the Island should be vested on the Insular Government."

The War Contribution hung fire, and in 1925 the British Government sent to the Isle of Man a committee of the Privy Council presided over by the late Duke of Athol. The representatives of Tynwald who negotiated with this committee repeated the contention that the question of war contribution should be linked with the question of increased financial control, and their report recommending a certain payment has an appendix containing the following proposals:

"That the present system whereby the Treasury controls the imposition of Customs duties and the appropriation of the Insular revenue be abolished and that Tynwald should thenceforth have control subject to the following provisions:

"Customs duties to be imposed by resolution of Tynwald confirmed by Act of Parliament as at present; Tynwald to budget for a surplus of not less than 5,000; any ascertained surplus to go into the Reserve Fund [a new name for the Accumulated Fund, into which, under a procedure set up by the Act of 1866, all surpluses from `general revenue' go automatically, and out of which votes are frequently taken for capital expenditure] or be available for the succeeding year's expenditure, as Tynwald may determine; no financial resolutions to be proposed in Tynwald except with the approval of the Governor; the Reserve Fund to be kept in credit to the extent of not less than 25,000 ... all enactments restricting the harbour revenue and Income Tax proceeds too be amended so that such funds may be dealt with as part of the general revenue; and that the Imperial Government should continue to control existing Reserved Services."

Sir Claude Hill persuaded Tynwald, in October of 1926, to make the contribution-which on his suggestion was fixed at 750,000-without attaching conditions. He added: "I feel able tc assure you of my personal conviction that all matters outstanding, including the application of financial control, will be most favourably and sympathetically considered by the Home Office and the Treasury."

Immediately after the war contribution had been fixed, Tynwald appointed a deputation to discuss financial control with the Home Office, and this eornm.ittce met Sir Malcolm Delevingne, an Under-Secretary for Home Affairs. Two members of the deputation, Mr Norris and the present Speaker, immediately urged that Tynwald should be authorised to set up an executive or advisory council of Tynwald, which should be consulted on financial policy as well as on policy generally, and that with the establishment of such a council the financial control of the Treasury, "except the general supervision and the safeguarding of the solvency cf the Island," should be abolished. Sir Malcolm Delevingne replied that he had understood that the interview was arranged to consider an adjustment and simplification of the Island's financial administration, as suggested in the 1925 Appendix, and he did not think the Government would be prepared to re-open the general question of the Island's constitution. On receiving this answer, Messrs Norris and Qualtrough withdrew from the conference.

Preparatory to this interview, the Government Secretary had drawn up a memorandum setting out the machinery by which the proposals in the 1925 Appendix could be put into effect. Working on that memorandum-though varying it in a number of important details-and having in mind the view; of the Home Office as expressed by Sir Malcolm Delevingne, the committee presented to Tynwald a programme of sixteen points. We reproduce the most significant of them, with a statement of the Home Office attitude upon each.

That Tynwald should continue to urge that any increase in the Reserved Services should first be approved by Tynwald, and that the words "the necessary expenses of government" should be struck out of the Act of 1866.-The Home Office insist upon remaining responsible for the judiciary and police. and ask the Manx Legislature to be satisfied with the right of consultation. They added:

"The responsibility for order and good government in the Island rests with His Majesty's Government."

That the Treasury powers of approving expenditure be delegated to the Governor.-Agreed.

That the Governor, after having given leave for the introduction of financial resolutions, may reserve any such resolution, if carried, for consultation with the Imperial Government before giving' his consent.-Agreed.

That Customs duties be confirmed by Act of Parliament as at present.Agreed.

That the Budget should provide, to the satisfaction. of the Treasury, for a surplus of 5,000, and that the Reserve Fund should regularly be maintained at 50,000.-Agreed; the figure of 50,000 was fixed at the Home Office suggestion.

That the accounts of the Government Treasurer continue to be audited by officials in London. (This is provided for in the Act of 1866.)

That the passenger tax, harbour dues, and other harbour receipts be paid direct to the Government Treasurer instead of to the Customs officials in London.-Agreed, but the committee inserted an addition, that the costs of the harbours should be borne by vote of Tynwald only, and that legislation should be introduced in Parliament to abolish the allocations of revenue towards harbours made in the Act of 1866. The Home Office disagrees with this.

The general effect of these discussions, then, is that the British Government agreed that Treasury approval should not be necessary to each financial resolution of Tynwald, but approval might be given within the Island by the Governor, who in doubtful matters was to ask for his instructions. Sir Malcolm Delevingne told the deputation that he had authority from the Home Secretary to agree upon these lines, but that he would wait to hear from them-which, as they told him, meant waiting to hear from Tynwald.

The Home Office is waiting still, and to some extent has itself occasioned the delay. The deputation's report came before Tynwald on July 9th, 1929, and consideration was postponed. In the meantime the Governor received, "semi-officially," further information about the British Government's attitude, and a serious difference developed on the question of the levying of the Customs duties. After meeting Sir Malcolm Delevingne, the deputation had recommended that all Customs duties should be levied annually. The British Government declined to accept this, remarking that from the standpoint of both the Isle of Man and the mainland, stability in Customs duties, was very desirable, and that the "passing of ill-considered motions" might jeopardise the visitor traffic. This was a matter on which some members of Tynwald felt very strongly; they had had experience of levying taxes without prescribing any period, and finding that the taxes could not be removed without a financial resolution placed on the agenda with the approval of the Governor.

In December, 1929, after the Governor had circulated this information, and after a new House of Keys had been elected, a new committee was appointed. Enthusiasm on the subject evaporated, and it does not appear that this committee ever reported.


In September of 1942, quite unexpectedly, the subject was raised afresh by the War Committee of Tynwald, while presenting an interim report upon post-war reconstruction. The committee remarked that the Isle of Man desired to expend its money on different schemes from those adopted in England; the Island could, for example, expend considerable sums on the visiting industry, which Parliament might not decide to spend on behalf of British visiting resorts. It head been urged by the Treasury that if they approved the Manx proposals, it would embarrass them in dealing with similar matters in the United Kingdom. If Treasury sanction were no longer required, commented the committee, any such embarrassment would disappear.

"It is impossible," said the committee, "for officials sitting in London to know our problems as we know them ourselves. Tynwald, acting under the guidance of the Lieutenant-Governor, is well able to deal with its own financial matters. It is suggested that the control of the Treasury should now be confined to satisfying themselves that the Island retains financial solvency. . The post-war problems of the Island will require energetic and immediate action, and that can only he secured if the Island has the right to expend its revenue in a manner that commends itself to its people and Government."


Though acknowledging that the British Government has the final say in the disposal of surpluses in the Customs revenue, Tynwald has from time to time claimed control over money raised by direct taxation. Some time before the 21 enactment of Old Age Pensions, the Keys passed an Estate Duties Bill and stipulated that the proceeds should be applied in such a way that the British Government would have no power to intervene. Their right to make such a stipulation was challenged, and as neither the Keys nor the British Government gave way, the Bill was lost. The controversy was renewed a year or two, later, on the introduction of Income Tax. The British Government, "while notable to accede to the demand that expenditure from moneys raised by direct taxation shall not be subject to the final approval of His Majesty's Government," agreed in order to avoid raising a constitutional point in the present instance that a provision should be inserted applying the proceeds of Income Tax first to the flour subsidy, and afterwards to "such purposes as may be determined by legislation." In pursuance of this decision, Acts have been passed from time to time charging the Income Tax Fund with proportions of the Pension and Insurance expenditure and of the war contributions.

Readers will recognise that before any Act of Tynwald applying the proceeds of Income Tax can become law, it must receive the Royal Assent-that is to say, it must still have the approval of the British Government.


"No lawyer did dispute, or I believe ever will dispute, that it is competent for the King, Lords, and Commons in Parliament to bind the Isle of Man." So said the advocate for the fourth Duke of Athol when appearing before the House of Lords in 1781. The opinion of the eminent Manx lawyer Sir James Gell, who, died in 1905, was that the. Isle of Man was excluded from the operation of an Act of Parliament unless it was expressly named therein. The Tynwald deputation of 1927 proposed to the Home Secretary's representative that a clause to that effect should be inserted in the British Parliament's Interpretation Act, but the Home Office took the view that this was unnecessary in view of the present practice.

For a considerable time now, when an Act of Parliament likely to affect the Isle of Mean is about to be introducedt into Parliament, information is given to the Manx Government so that Tynwald may have the opportunity of making its observations. Sir Spencer Walpole remarked that even in matters which affect the Island and Great Britain jointly, and where it would be quite natural for Parliament to include the Isle of Man in the scope of its legislation, there was an increasing tendency on the part of the Isle of Man to, pass its separate legislation, "supplementing an Act of Parliament by an Act of Tynwald." This tendency has developed since Walpole wrote, and nowadays Tynwald even passes laws to bring the Island within the scope of international conventions.

  Back index next  

Any comments, errors or omissions gratefully received The Editor
HTML Transcription © F.Coakley , 2008