A recent proposal to curtail the powers of the Comptroller and Auditor General of India runs contrary to national and international conventions. Rather, it is the duty of both the executive and the legislature to strengthen this constitutional office
A conference of the chairpersons of Public Accounts Committees (PACs) has just been held under the aegis of the Parliament’s PAC. Nishikant Dubey, Member of Parliament (Lok Sabha), member PAC, and a convener of the conference, stated that the time has come to make our national auditor, the Comptroller and Auditor General of India (CAG), accountable to Parliament through a constitutional amendment.
This is a strange demand, given that the CAG’s constitutional mandate, under the CAG (Duties, Powers & Condition of Service) Act or Audit Act, is to hold the executive accountable. Such a demand had never been articulated in the past. On the other hand, there have been demands for strengthening the Audit Act to further empower the CAG.
Gautam Sen
The CAG’s office initiated an amendment to the Audit Act during the tenure of the first United Progressive Alliance (UPA) government (when Pranab Mukherjee was the Union Finance Minister) to enable a comprehensive audit of public funds and bodies rendering public service, and for a structured and time-bound response to the audit reports. CAG did not receive a positive response from the government.
Delayed tabling of CAG reports
Baijayant (Jay) Panda, MP, Biju Janata Dal, had initiated a private member’s bill in the previous Lok Sabha, in 2013, for a similar purpose, to enable the CAG to undertake performance audits without any constraint. There was a view in some quarters of the executive that the CAG needed to restrict his audit primarily to the compliance of rules and regulations, and present the audit reports to the legislature within a specified time frame.
This bill, though eventually withdrawn, was also intended to compulsorily ensure the tabling of CAG reports to the legislature by the executive, within seven days of their receipt from the auditor, thus ensuring response from the executive. The CAG’s reports on quite a few occasions were not being presented to the legislatures concerned on time, as they were deemed inconvenient by the government of the day, aborting the scope for timely legislative scrutiny and follow-up remedial action, including a fixing of responsibility on the functionaries concerned. Thus, there was a clear undermining of the constitutional system, impeding the accountability of the executive to the legislature by not allowing the CAG to perform his or her constitutionally mandated role and serve Parliament adequately in the area of financial oversight.
Therefore, accountability of the executive to the legislature, whose members are representatives of the people, and the legislature’s ability to adequately work on the audit’s outcome was impeded. Such a feedback and accountability mechanism is an essential component of the CAG’s accountability to Parliament.
Greater accountability, less power
Accountability of the CAG to Parliament has many implications. An extreme situation may arise if Parliament, controlled by a majority of members of a single ruling party, prevents an audit scrutiny of transactions prima facie found irregular or deemed injudicious or uneconomical or violative of the statutory canons of financial propriety.
The present constitutional structure ensures independence of the CAG to go into the entire gamut of audit functions where public interest is involved. This view is supported by judicial pronouncements in some cases, including the Supreme Court decision in the Civil Appeal No. 4591 of April 2014 (Association of Unified Tele Services Providers & Others vs. Union of India) case. Therefore, it is the legitimate duty of both the executive and the legislature to uphold the CAG’s ambit, and in no way fetter it by a constitutional amendment. In the present milieu of competing displays of political opportunism, any amendment that has the scope to constrict CAG’s functional role should not be encouraged in the national interest.
“If at all an amendment is necessary, Article 149 of the Constitution can be amended to explicitly indicate the scope of the CAG’s responsibility. The Audit Act, suitably amplified, could supplement the provision.”
It is useful to draw the public’s attention to Article 324 of the Constitution, which fully empowers the Election Commission of India (ECI) to superintend, direct and control the election of the President, the Vice-President and the legislatures, both at the Centre and in the States. Apropos the elections, the powers of the ECI are absolute and even litigation before the judiciary can only come after the completion of the election process.
CAG’s functioning should be similar to that of the ECI. Articles 148 to 151 of the Constitution provide the requisite enabling constitutional framework. Under extreme circumstances, when the CAG does not function in consonance with his or her constitutional role or violates it, a provision for his or her impeachment has been made under Article 148. Therefore, there should be no apprehensions in Parliament or in the PAC on the accountability or non-performance of the CAG. If at all a constitutional amendment is necessary, it could be to amend Article 149 of the Constitution and to explicitly indicate, but in the broadest possible manner, the scope of the CAG’s responsibility. The Audit Act, suitably amplified, could supplement the proposed amended constitutional provision.
In most Commonwealth countries, the legislative auditor is the Auditor-General, whose office is a core element of parliamentary oversight, and he or she reports directly to Parliament and to the PAC. In some instances, the Auditor-General is an officer of Parliament, with the latter guaranteeing him independence from the executive (as in the case of Australia and the U.K.) while in some other instances, he or she is independent of both the executive and the legislature, as in the case of India.
CAG-PAC relationship
Whichever model is followed, the importance of a very close relationship between Parliament’s core financial oversight body, the PAC, and the CAG, cannot be overstated. The Indian Parliament could adopt a charter or convention outlining the broad contours of cooperation between the CAG and the PAC. The purpose may be to adopt a mutually reinforcing approach. However, we have to be cautious to ensure that the parameters do not eventually have the effect of limiting the CAG’s audit powers and thereby prevent a broad appraisal of executive actions.
With the benefit of nearly seven decades of experience since Independence, it may not be inappropriate to conclude that the institution of CAG has stood the test of time. However, there needs to be an enhanced role for the CAG for a comprehensive financial oversight over not only direct government departments, but also over autonomous and statutory entities. This is because, in the present environment of an open economy where there are numerous private-public enterprises, some public entities may not be substantially funded by the government but would, nonetheless, be rendering public service.
As regards the suggestion for making the CAG more accountable to Parliament, there can be no justification for such an amendment. There will be no apparent systemic improvement in making him an officer of Parliament or by making him dependent on it, despite the move ensuring his or her independence from the executive. On the contrary, the possibility of an adverse application of this institutional change cannot be ignored.
If Parliament or its PAC feels that there is a need to look beyond the audit reports of the CAG, there is no institutional or regulatory bar that prevents it from doing so. There has been an instance in the U.K. when its PAC suo motu issued a report — not based on the U.K. National Audit Office and its Auditor General’s report — to highlight departmental failures in financial administration, which the Auditor General appropriately followed up. The CAG in India can similarly be expected to follow up and reinforce the PAC’s efforts in matters of financial governance towards ensuring probity, accountability and transparency. The CAG has only to be provided adequate institutional support in order for him or her to discharge this vital, constitutionally enshrined role.
(The author is a retired Indian Defence Accounts Service officer and former Additional Controller General of Defence Accounts of Government of India.)
