The UK Exchequer (formally His Majesty's Exchequer) is part of the machinery of government, defined as 'the legal and accounting entities which support the UK's spending and revenue activities'. The term is used for the accounting processes of central government, and as such it appears in various financial documents (including the latest departmental and agency annual accounts). The Consolidated Fund account at the Bank of England is officially termed 'The Account of His Majesty's Exchequer': it serves as the government's current account, into which is paid the money raised from taxation (and other government revenues), and out of which is issued money for government spending.
Historically the Exchequer (the Court of Exchequer) was an executive body, having the combined characteristics of a government department and a court of law. It was responsible for the collection and the management of taxes and revenues, making payments on behalf of the sovereign and auditing official accounts. Twice a year, at Easter and Michaelmas, those responsible for collecting the king's revenue (sheriffs, bailiffs, escheators and others) were summoned to the Exchequer to deposit the money and account for all that was owed.
The existence of an Exchequer in England was first recorded in 1110. Similar offices were established in Normandy (by 1180), in Scotland around 1200 and in Ireland in 1210.
Alongside its accountancy responsibilities, the Exchequer had a judicial character. Its primary function in this regard was as a court of revenue: concerned with asserting and protecting 'the royal prerogative in matters regarding the King's revenue', as well as enforcing payments and preventing fraud. From an early date, however, the Exchequer developed a broader jurisdiction (and secondary function) as a court of common pleas: 'hearing and determining personal suits and actions at law between subject and subject'. Over time, the principle of equity was admitted into the judicial workings of the Exchequer, which then came to be recognised as a court of equity as well as a court of law. In the Tudor period the judicial work of the Exchequer further expanded: the Court of Augmentations and the Court of First Fruits and Tenths were both merged into the Exchequer, significantly increasing its workload.
The old Exchequer continued in operation until the 1830s, after which its various offices were gradually and progressively abolished (with their functions being transferred to other departments of state or courts of law). The Exchequer as presently constituted dates from the passing of the Exchequer and Audit Departments Act 1866, which remains in force in relation to the accounting processes of HM Government. It is 'one of the oldest surviving institutions of its type in the world'.
Etymology
The Exchequer was named after a table used to perform calculations for taxes and goods in the medieval period. According to the Dialogus de Scaccario (the 'Dialogue concerning the Exchequer', an early medieval work describing the practice of the Exchequer), the table was large, 10 feet (3.0 m) by 5 feet (1.5 m) with a raised edge or "lip" on all sides (of about the height of four fingers to ensure that nothing fell off it), upon which counters were placed representing various values. The name Exchequer referred to the resemblance of the table to a chess board (French: échiquier) as it was covered by a black cloth bearing stripes of about the breadth of a human hand in a chequer-pattern. The spaces represented pounds, shillings and pence. It has been suggested that this was necessary because many of those who were responsible for collecting and submitting taxes, were unable to read or write; more straightforwardly, the counting table provided a useful and practical means of calculating, in plain sight, how much was owed and how much had been paid.
Exchequer in England and Wales
Like other offices of state in England, the Exchequer originally formed part of the Curia Regis or King's court. The royal court was the centre of government administration and finance. No distinction was made between the King's money and the public finances. It was also the seat of justice, cases being heard in the Aula Regis (the Great Hall of the king's palace).
In origin, His Majesty's Treasury was a strong box kept in the king's chamber and therefore it was overseen by the king's Chamberlains (who remained in charge even after it had been given a more secure and permanent base in Winchester Castle). The Treasury was, first and foremost, the place where the money was stored. The Exchequer, on the other hand, emerged (in the early 12th century) as a financial office: 'the Curia sitting for financial purposes'. As such, it was, by default, staffed and overseen by the Great Officers of State. By the reign of Henry II, in the mid-12th century, the Exchequer had come to be based in the Palace of Westminster (the monarch's principal royal residence in London), though occasionally (up until 1339) it sat elsewhere. By the time King John came to the throne, the king's treasury had been removed from Winchester to Westminster.
By the end of the 12th century, the Exchequer had begun to separate itself from the Curia Regis and was operating more-or-less independently both as an administrative and as a judicial body. When in session it was termed the King's Court at the Exchequer (Curia Regis ad Scaccarium). Those involved in its oversight included the aforementioned Chamberlains, the Chief Justiciar (the senior judge and de facto chief minister of the kingdom), the king's Chancellor (who was head of his writing office and custodian of the Great Seal of the Realm) and his Treasurer (a comparatively junior official at this time); the Chancellor and Treasurer were clerics, the Chamberlains were laymen.
The early Exchequer (12th and 13th centuries)
Origins
It is unknown exactly when the Exchequer was established, but the earliest mention appears in a royal writ of 1110 (during the reign of King Henry I), addressed from Roger of Salisbury and Ranulf the Chancellor to the barones de scaccario (Barons of the Exchequer). The oldest surviving Pipe Roll is that of 1130, already in mature form (indicating that such records existed for some time beforehand, though they do not survive). Pipe Rolls form a mostly continuous record of royal revenues and taxation (though not all such revenue went into the Exchequer, so some taxes and levies were never recorded in the Pipe Rolls). The Dialogus de Scaccario ('Dialogue concerning the Exchequer'), which gives a detailed description of the Exchequer and its workings, is believed to date from the late 1170s (during the reign of Henry II).
According to the Dialogue, the Exchequer is "said to have begun with the very conquest of the kingdom made by king William, the arrangement being taken [...] from the exchequer across the seas" (i.e. the Exchequer of Normandy); albeit "they differ in very many and almost the most important points". Some scholars, including Thomas Madox (in his 1769 History of the Exchequer), have accepted the likelihood of this proposition; others, such as 19th-century constitutional historian William Stubbs, have dissented from it. (Either way, in contrast to those of its English counterpart, no surviving records of the Exchequer of Normandy predate 1180).
The Exchequer's modus operandi came to be referred to, with reverence, as the Course of the Exchequer: appeal was frequently (and often selectively) made to the 'ancient Course' by officers of the Exchequer in order to justify claims of precedence and particular ways of working.
Constitution
The Dialogue concerning the Exchequer describes the c. 1180 Exchequer as split into two components, which it terms the 'upper Exchequer' and the 'lower Exchequer'. The upper Exchequer (usually referred to simply as 'the Exchequer', formally the Court of His Majesty's Exchequer) functioned as a Court of Audit: those appointed as Barons of the Exchequer would sit at the counting table (with its distinctive chequered cloth) where, one by one, the sheriffs of the kingdom (and others with responsibility for Crown revenues) would present themselves to account for monies (rents and other income) which they had received on behalf of the King. The lower Exchequer (known as the Exchequer of Receipt, formally the Court of the Receipt of His Majesty's Exchequer) was where these monies were deposited (and wooden tally sticks issued as a receipt for each deposit). The two were inextricably connected: 'whatever is declared payable at the greater [upper] one is here [at the lower] paid; and whatever has been paid here is accounted for there'.
The 12th-century Exchequer normally sat twice a year: at Easter and Michaelmas. The Exchequer year ended on 29 September (the feast of Michaelmas); thus at Michaelmas (at the "Scaccarium S. Michaelis") the sheriffs were required to present their final account for the year, while at Easter (the "Scaccarium Paschæ") they were required to present an interim account. The Exchequer of Receipt at this time only operated while the Exchequer itself was in session; afterwards the chests of money were taken and deposited in the Treasury at Winchester.
Originally, the Exchequer's jurisdiction covered only such matters as were associated with the king's revenue; however, owing to the Barons' experience in weighing evidence and passing judgements, the king began to look to the Exchequer to settle disputes between his subjects (particularly those concerning property and possessions).
At that time, the only courts sitting at Westminster were the Exchequer and the Curia Regis itself. During the reign of King John, what would become the Court of Common Pleas began to emerge, its explicit purpose being to hold pleas of 'all civil causes at Common Law between subject and subject in actions real personal and mixed'; nevertheless, the emergence of this new court did not prevent civil pleas still being heard in the Exchequer. While the chief purpose of the latter was always "to decide on all matters affecting the rights and revenues of the crown" (indeed "in all cases where the sovereign's revenue is affected the Exchequer is the only court where the question can be tried"), the 'Plea side' ('hearing and determining personal suits and actions of law between subject and subject') continued operate, alongside the 'Revenue side', right up until the court's demise in the late-19th century.
Operation
The operation of the medieval Exchequer, as first described in the Dialogue, is summarised below.
Summonses
Under Henry I, the procedure adopted for the audit involved a writ of summons being issued to each sheriff, twice yearly, requiring him to come before the Exchequer with an account of the income in his shire. It included a detailed statement of all amounts due (determined in part by reference to the previous year's Roll). Income to be accounted for usually included the county farm (a fixed sum payable in lieu of income from royal demesne lands), debts carried over from the previous year, amercements levied at the general eyres and forest eyres, taxes such as scutage and tallage, "oblata" (payments made in return for favours) and other miscellaneous items.
The summons came to be known as the 'Summons of the Pipe'. It required the sheriff to bring to the Exchequer: money to be paid in, tallies (as proof of deposit) for money already paid in, and copies of any writs or quittances (which made allowances for out-of-pocket expenses). Information on amercements was estreated [extracted] in advance from the plea rolls of the lower courts and sent to the Exchequer (in the form of an "estreat roll") to be incorporated in the summonses. Similarly, the Chancery extracted information from its fine rolls, which included a record of every grant of land made in that office on which rents were reserved or fines payable; this was compiled into a document known as the "originalia roll", which was likewise sent to the Exchequer to be used in the preparation of the summonses.
Tallies
There were two types of tally issued by the Exchequer: 'tallies of sol.' were issued as proof of money paid (Latin: solutum) into the Exchequer of Receipt; 'tallies of pro' were a form of financial instrument, issued for the benefit of ('pro') an accountant (e.g. a sheriff), authorising him to make a direct payment to a third party out of revenue collected (without the sum having to be first deposited and then withdrawn from the Exchequer of Receipt). In the mid-1280s the use of these tallies was regulated by letters patent issued by king Edward I.
The lower Exchequer
Before appearing before the Barons, each sheriff had to go to the Exchequer of Receipt to pay in what was due. Payment was normally made in the form of silver pennies; it was not unusual for a sheriff to deposit tens of thousands of coins, amounting to several hundred pounds sterling. The coins were counted by the tellers and separated into 100-shilling (£5) batches. Periodically a mixed selection of 240 pennies would be separated off by the Chamberlains' knights and weighed against a Tower pound; if the coins were too far below the requisite weight the whole deposit could (in theory) be rejected. Each £5 batch was also weighed, before being loaded into £100 sacks (which, when filled, were sealed by the Treasurer's clerk). The sacks were stored in strong boxes with double locks (requiring the presence of both Chamberlains' knights to unlock them), over which the Treasurer's clerk again set his seal.
At Westminster (where the main Exchequer of Receipt was located), the tellers, who were clerks, occupied an office on the upper floor where they received and counted the money. Once the money had been deposited, the details of the deposit were written on a parchment (a 'teller's bill'), which was sent down a pipe to the Tally Court (the room below). Here, the Treasurer's clerk copied the details on to the tally stick, and also made an entry on the Receipt roll (the pell of Introitus). passed to the Chamberlains' staff who cut a tally for each deposit made. Finally, after everything had been checked, the Deputy Chamberlains split the tally: the 'stock' would be given to the sheriff and the 'foil' kept by the Exchequer. Like the Court of Exchequer itself, the Tally Court was furnished with a large table, covered with a chequered cloth, and seats for the senior officers.
Money could only be issued from the Exchequer of Receipt on royal authority, issued to the Treasurer and Chamberlains by writ 'of Liberate'.
The upper Exchequer
In the upper Exchequer the sheriff handed over his summons, which itemised the payments which had been required of him; he then produced the relevant tally stock as proof of payment for each sum deposited (and this was immediately checked by the Chamberlains against the corresponding tally foil). The total amount paid in (totted up using the counters on the table) was then compared against the amount due, and if there was a shortfall (after authorised expenses had been taken into account), then the Barons would judge whether the money owed could be carried forward, or whether the account-holder should be detained pending full payment. The Barons had use of a privy chamber (thalamus secretorum) where they could withdraw if necessary to consider points in private, so that the ongoing accounting business of the Exchequer was not thereby necessarily delayed.
Many Exchequer payments (including most of the county 'farms') were reckoned 'in blanch', meaning that an additional payment had to be paid (to make up for any discrepancy between the face value and actual silver content of the coinage used). At times the level of this payment was ascertained by assay: coins with a total face value of £1 were melted down and the silver ingot produced was solemnly weighed against a pound weight before the Barons; at other times a notional blanch of a shilling in the pound (i.e. 5%) was used.
When everything had been accounted for, the sheriff having been judged to have correctly paid all that was due, he was duly granted his Quietus: a written statement of his acquittal.
Personnel
In the upper Exchequer, the Chief Justiciar (who presided, in the absence of the king) sat at the head of the table. Facing him (across the table) sat the sheriff (or other person) whose account was being examined. On the Justiciar's left sat the king's Chancellor and others who had been appointed as Barons of the Exchequer for the duration of the session. The Chancellor attended with the Great Seal of the Realm, which served as the seal of the Exchequer. (Up until the early 13th century the Great Seal was ordinarily kept in the 'Treasury of the Exchequer' when not in use).
Barons of the Exchequer
The Barons of the Exchequer were described in the Dialogue as 'certain who excel in greatness and discretion, whether they be of the clergy or of the Court', sitting 'by the mere command of the Sovereign, and so with temporary authority'. Their role was 'to decide rights and to determine questions that arise; for the special science of the Exchequer consists not in accounts but in judgements of all sorts'. It was still the norm at this time for Great Officers of the State to serve as Barons by virtue of their office (though others would be appointed in their place if they were otherwise engaged, which often happened as they frequently had duties elsewhere). Those chosen to serve as Barons for the forthcoming session 'by reason of their office or by mandate of their prince' were called to attend by writ of summons.
Alongside the Justiciar and the Chancellor, those usually appointed Barons by reason of their office were the Constable, two Chamberlains and the Marshal. Each had particular roles with regard to the Exchequer when it was in session: the Constable would witness (with the Justiciar) any writs that were drawn up (e.g. for the issuing of money or the discharge of debts); the Chamberlains were the deputies of the Master Chamberlain who had oversight of the Treasury (unlike the other Barons, the Chamberlains had duties in the lower as well as the upper Exchequer); the Marshal was responsible for detaining any individuals who failed to satisfy the Barons with their account, and afterwards (if the court so required) placing them in custody.
Around 1234, the office of Baron of the Exchequer began to emerge as a permanent appointment with its own distinct status, function and salary. At around the same time, the judicial business of the Exchequer began to be placed on a more formal footing: the earliest plea rolls of the Exchequer date from 1236. The Barons, however, were more revenue specialists than jurists at this time.
Clerks and other officers
Seated along the long side of the table, at the right hand of the Justiciar, were the king's Treasurer and the clerks who were tasked with making a record of the proceedings: the Treasurer's clerk (later 'Clerk of the Pipe') was responsible for the Treasury Roll (also known as the Great Roll of the Exchequer or Pipe Roll). The Chancellor's clerk (later 'Comptroller of the Pipe') was responsible for the Chancellor's Roll (which was a duplicate record of proceedings and served as a counter-roll); he was also responsible for drawing up writs to be issued through the court. The Constable's clerk was also present (he played a key role in maintaining communication with the king's Court; for example, if a sheriff produced a writ from the king in court permitting or excusing him certain payments, the Constable's clerk would be responsible for producing the counter-writ and checking the one against the other).
Facing them across the table sat the Chamberlains' serjeant (who had with him the counter-tallies from the lower Exchequer, for checking against the tallies brought by the sheriffs), the Chancellor's deputy (the Magister Scriptorii, a forerunner of the Master of the Rolls) and, between them, the 'calculator' responsible for placing the counters on the counting table.
The king could appoint others to sit at the Exchequer in addition to the office-holders listed above; for example, the Dialogue lists the Bishop of Winchester (Richard of Ilchester) as having a seat at the table at that time (as a personal appointee rather than an office-holder) and also Thomas Brun (who had been tasked with creating a third Exchequer Roll, so that the proceedings would be recorded in triplicate).
The Treasurer and Chamberlains
The king's Treasurer (who was also designated Treasurer of the Exchequer) and the two Chamberlains (usually called Chamberlains of the Exchequer) were the executive officers of the Exchequer. The Treasurer and his staff were clerics (and therefore literate), the Chamberlains and their staff were laymen. As well as having seats and duties in the upper Exchequer, the Treasurer and Chamberlains presided over the lower Exchequer, the Exchequer of Receipt, where they held joint responsibility for its transactions (their shared oversight functioning as an early form of internal audit).
Their duties in the Exchequer of Receipt were normally undertaken by deputies: those of the Treasurer by a clerk, those of the Chamberlains by a pair of knights (later called the Chamberlains of the Receipt). The clerk of the Treasurer was responsible for maintaining the written records of money paid in and paid out (the 'pells' of introitus and exitus, respectively), while the deputy Chamberlains and their staff were responsible for the cutting and issuing of tallies. As well as serving as Clerk of the Pells, the Treasurer's clerk functioned as Tally Writer, a duty which later developed into the separate office of Auditor of the Receipt of the Exchequer.
During the 13th century the office of Chief Justiciar gradually receded in importance (it had disappeared by the end of the reign of Henry III, i.e. by 1272). In place of the Justiciar, the king's Treasurer (whose influence in the realm was steadily growing) began to take precedence at the Exchequer. His role developed into the office of Lord High Treasurer of England; those appointed to this office were invariably appointed Treasurer of the Exchequer at the same time, by issue of a separate patent. After the appointment of Barons of the Exchequer became permanent, the Treasurer and Barons were viewed as the senior officers of the Upper Exchequer, and the Treasurer and Chamberlains as the senior officers of the Lower Exchequer (the Treasurer thus having overarching oversight).
Chancellor of the Exchequer
During the first part of the 13th century (by 1248 at the latest) the distinct office of Chancellor of the Exchequer emerged. At around this time the Chancery was increasingly gaining independence from the Curia Regis. The king's Chancellor (subsequently termed Chancellor of England) was now running a largely autonomous department of state. He continued to sit periodically as a Baron, but his clerk took over most of his other duties with regard to the Exchequer (and during the reign of Henry III he began to be termed 'Chancellor of the Exchequer'). At the same time, the Exchequer was provided with its own seal (the Great Seal of the Realm no longer being to hand), which was placed in the Chancellor of the Exchequer's keeping; he also took custody of the Chancellor's Roll (the counter-roll to the Pipe Roll).
Constable and Marshal of the Exchequer
In the early years of the Exchequer, the Constable of England (as de facto commander of the royal armies) and the Marshal of England (as his deputy) had duties in the Exchequer relating to the payment of soldiers (such as may have been hired during the year to supplement the provision of troops by feudal baronies and the like). Due to their having extensive duties elsewhere, these officers were frequently (and, by the mid-13th century, invariably) represented in the Exchequer by deputies (termed 'Constable of the Exchequer' and 'Marshal of the Exchequer' respectively). The former office was relatively short-lived, but the latter remained in place until the 1830s; appointments to it were made by the Hereditary Marshal of England up until 1601, after which the right to appoint was vested in the Crown.
Remembrancers of the Exchequer
By the end of the 12th century the business of the Exchequer had expanded to such an extent that it was sitting for much of the year. Increasing complexity led to the audit process for each County being separated into a preliminary and a final phase, with a proliferation of vouchers and memoranda being required to ensure continuity. By the mid-13th century a pair of Exchequer officers called Remembrancers had been appointed. Each kept what was known as a Memoranda Roll (one on behalf of the King, the other on behalf of the Treasurer); these supplemented the Pipe Roll by recording other items of Exchequer business from day to day.
By 1299 each was distinctly titled: the King's Remembrancer and the Treasurer's Remembrancer. Each went on to develop a distinct role: the King's Remembrancer's office managed the preliminary audit, the Treasurer's Remembrancer (later Lord Treasurer's Remembrancer)'s office managed the final audit. A parallel distinction was that the King's Remembrancer's office enforced the recovery of debts to the Crown, while the Treasurer's Remembrancer's office ensured the rendering of duties to the Crown. ('Debts' included payments arising from torts and trespasses, and other income not included on the Pipe Roll; 'duties' due to the king included 'rents, fines, issues, amerciaments and other things [...] received or levied by the Sheriff', which were recorded on the Pipe Roll).
As the revenue from trade and commerce began to eclipse feudal income, so the work of the King's Remembrancer greatly increased, while that of the Lord Treasurer's Remembrancer diminished.
Others
A distinct set of officers was responsible for the assays which routinely took place as part of the accounting process, including the melter and the weigher. In common with other lay offices in the Exchequer, these (comparatively lucrative) positions were held in fee, with deputies employed to perform the actual duties required; in time they became hereditary sinecures. Another such officer was the Usher of the Exchequer, who was responsible for the security of the building and its treasures. He was also entrusted with conveying the writs of summons to their various recipients, for which he oversaw a corps of messengers.