The Interaction of Contract and Executive Power

AuthorNick Seddon
Published date01 September 2003
Date01 September 2003
Subject MatterArticle
Nick Seddon*
Over the last 25 years, governments of all persuasions in western democracies have
increasingly resorted to contract as a means of carrying out governmental tasks and
achieving policy outcomes. The use of contract by government is not a new
phenomenon but, in more recent times, the increasing use of contract in areas that
were traditionally the province of direct government action has been a marked feature
of public administration. This movement has spawned a vast literature covering many
disciplines and has generated new theories about public administration. One of the
difficult issues to resolve in connection with this phenomenon is the sometimes
awkward mixture of a private institution — contract — to achieve public purposes.1
This paper is one of a group of papers on the theme of the interaction between the
government's executive power and legislation. This paper is about contract and the
executive power. Combining these together, it is appropriate to discuss the interaction
between legislation and the use by government of the executive power to make
It will be seen that most government contracts are made under the executive power
which, in turn, is usually not affected by legislation, with the consequence that the
government has a very wide power indeed to make contracts. Traditional measures of
accountability for the exercise of public power tend to be minimal in controlling the
executive power to make contracts. Further, this power may be exercised to bind
future governments whose ability to be rid of the contractual obligations is very
* Special Counsel, Blake Dawson Waldron, Lawyers
1 I use the word 'contract' in the lawyer's sense of a legally enforceable agreement. The word
is used by public administration scholars in a much broader way to cover any arrangement
between two bodies (which may not be separate legal entities) under which one entity is
required to do things or achieve outcomes for the other entity. Thus the word is used in a
purchaser-provider model where the purchaser and provider may be entities within the
one government or may even be employees working for the same employer.

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