Millennium Post

Auditing the auditor

Auditing the auditor
The three reports submitted by the Comptroller and Auditor General (CAG), namely, on the allocation of coal blocks, functioning of the Delhi airport and allocation of additional coal blocks to Reliance Power has drawn immediate and sharp criticism from the government, which was coordinated no less than the Prime Minister’s Office. The Minister of State in the PMO, V Narayanswamy, was quick to state that the CAG is not following its constitutional mandate, rather over-stepping it by questioning government policy.

This is once again going to raise the debate over the mandate of the CAG especially since its reports have opened a Pandora’s Box. Originally, public audit was rule-based and was concerned with probity and compliance alone. However, in recent times there has been increasing demands to know more about performance and results, rather than merely accounting for legality and propriety in public spending. The CAG, under present incumbent Vinod Rai, is functioning more in keeping with the recent trends rather than sticking to hoary conventions.

However, Vinod Rai’s reports run the risk of government criticism for having allowed the document to be leaked and be discussed on every possible forum much before they were tabled in the House. Till a few years back, it was even unthinkable that this document, whose sanctity was, if not greater than, at least equal to the budget document, could be leaked. Though the reports got leaked much before it was tabled in Parliament, none in CAG’s office has bothered to check on this constitutional impropriety. This is reflective of the increasing urge of the constitutional authorities to assign themselves the role of the public crusaders.

This presumption would invite a debate on the correctness of such a stand. In the past one year or so, public crusaders like Team Anna have shown the desire to arrogate to them the role of a super constitutional authority whereas the existing constitutional authorities, who need to function in a detached manner, have also, probably as counter, increasingly shown interest in keeping alive the public crusade. Such a situation calls for the need to re-examine and redefine the roles of the constitutional offices.

Those who support a pro-active role by the CAG claim that all attempts to improve governance will come to a naught if the agencies responsible for governance do not consider probity in public life and ethical behaviour as cardinal principles in their official dealings. In this the CAG has a role to play as it’s mandated to enforce probity and ethics in public administration. Watchful, efficient and effective vigilance and auditing structures minimise if not prevent threats to accountable administration of public funds.

However, there is another school which maintains the CAG to be a stumbling block in smooth administration, a view which is also being echoed by the advocates of the UPA government. Academically, it was administrative thinker Paul H Appleby who first asked for the scrapping of the office of the national auditor. Journalist, public servant and educator, Appleby went to become the dean of Syracuse University’s Maxwell School of Citizenship and Public Affairs. Post-Independence, he came to India on many occasions and published several articles on the Indian administration. He was also responsible for the setting up of the prestigious Indian Institute of Public Administration (IIPA).

In his Second Report on Indian Administration, Appleby even suggested that the office of the CAG should be abolished. According to his thesis, the function of the CAG was in a large measure an inheritance from colonial rule responsible for killing initiative in governance. He called auditing ‘a necessary but highly pedestrian function with a narrow perspective and very limited usefulness.’ He held the auditors responsible for ‘widespread and paralysing unwillingness to decide and to act’ on part of the administrators.

The suggestions made by Appleby were not accepted and the pre-eminent position of the CAG was retained as part of parliamentary control over administration. ‘Since Parliamentary control and statutory audit are the basic features of our Constitution, they cannot be barriers to the accomplishment of Government’s objectives, therefore, audit must not be either scrapped or relaxed,’ said those in the defence of retaining the audit.

However, the sustained leaks from the CAG’s office and the media hysteria it has created for more than the past one year has the potential to usurp the role and control of Parliament in the matters of audit. The Comptroller and Auditor-General, engaged in the scrutiny of the financial affairs of the executive, submits its report to the Parliament and state legislature, to which alone it is responsible. The legislature arbitrates between the audit and the executive through an important committee called the Public Accounts Committee, which is conventionally headed by a MP from the principal opposition party.

With civil society activists already questioning the sovereignty of Parliament, the contending parties especially the Opposition will be playing a destructive role by demanding quick fix action on the audit reports without allowing the matter to be debated in the PAC and thereafter on the floor of the House.

Audit reports in past have become the basis for criminal investigation, but that has happened only after proper enquiry and due procedure. Therefore, the government should initiate a quick debate on the report and proceed to act against those charged of corruption rather than pushing it under the carpet, questioning the mandate of the CAG and, before that, delaying its tabling in the House.


Sidharth Mishra is with Centre for Reforms, Development & Justice, and consulting editor, Millennium Post.
Sidharth Mishra

Sidharth Mishra

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