The Financial Revolution

At the end of this war it emerged as the leading European power - and Parliament more powerful than before because of its increased control over the Crown's finances.

Raising money for war

The Commons, which had been in charge of initiating supply Bills since the 15th century, deliberately kept William III underfunded, ensuring that he and later his successor Anne had to keep Parliament almost continuously in session to get the money necessary to run a war. The cost of about £5.5 million a year in its early stages rose to about £8.5 million a year by its end.

During the war royal ministers and servants, most often sitting in the Commons, developed innovative new taxes which were actually paid because they were seen by the public as legitimate, if burdensome, owing to their parliamentary origins. Through these an average of nearly £5 million a year was raised.

Commission of Public Accounts

In 1690 the Commons established a Commission of Public Accounts to monitor how the revenue was being spent by the Crown and began inserting appropriations in its supply Bills, directing how the revenue it raised was to be used for specific purposes.

This increased parliamentary control of revenue helped to ensure the success of the Bank of England, created by statute in 1694, for investors in the Bank could be confident that their loans to the Government would be repaid by parliamentary taxation appropriated for that purpose.

Civil List

Another piece of this so-called 'Financial Revolution' which fundamentally altered the relations between Crown and Parliament was the creation of the Civil List in 1698. This was how Parliament granted the Crown revenues of £700,000 a year to meet the costs of running the Government and royal establishment. From this point, the Crown was reliant on Parliament's control of revenue for its day to day running.