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CAG: A Parliamentary Institution

The Comptroller and Auditor General has been called the "most important officer of the Constitution". But now as before - on Bofors in 1989 and in the states as well - the executive loses no opportunity to denigrate the office for its inconvenient findings.

COMMENTARY

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CAG: A Parliamentary Institution

B P Mathur

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Constitution” and Rajendra Prasad said,
“he has (the) power to call to account any
officer, however highly placed, so far as
state moneys are concerned”.
The main thrust of the CAG’s 2G report is
that a huge loss to exchequer was caused by
the fact that, “issuance of licences in 2008

The Comptroller and Auditor General has been called the “most important officer of the Constitution”. But now as before – on Bofors in 1989 and in the states as well – the executive loses no opportunity to denigrate the office for its inconvenient findings.

B P Mathur (drbpmathur@gmail.com) is a former Deputy Comptroller and Auditor General and the author of Government Accountability and Public Audit.

U
nion Telecom Minister Kapil Sibal in a press conference on 7 January said that the loss on 2G spectrum calculated by the Comptroller and Auditor General (CAG), is “utterly erroneous and without any basis”, and denigrated the i nstitution of the CAG, which amounts to constitutional impropriety.

Under the Constitution, the CAG has been given an independent status, equivalent to that of a Supreme Court judge, so that he/she can work without fear or favour. The CAG’s responsibility is to see that money voted by Parliament is spent according to its wishes and with due regard to wisdom, faithfulness and eco nomy and a high degree of probity is maintained by public officials while handling state money and property. B R Ambedkar called the CAG the “most important officer of the along with allocation of spectrum has been done by DOT at prices determined in 2001 which were based on (a) totally nascent market, despite the sector witnessing substantial transformation and manifold growth”, bypassing advice given by the Telecom Commission, the Ministry of Finance, the Ministry of Law and the Prime Minister’s Office. Regarding the quantum of loss, the report says,

any loss ascertained while attempting to value the 2G spectrum allocation to 122 licenses in 2008 can only be presumptive, given the fact that there are varied determinants like its scarcity value, the nature of competition, business plan envisaged, number of operators, growth of sector, etc, which depending on market situation, would throw up the price at a given time.

The CAG has worked out the “presumptive” loss under three different scenarios, and the estimates range from Rs 57,000

january 22, 2011 vol xlvI no 4

EPW
Economic & Political Weekly

COMMENTARY

crore to Rs 1,76,000 crore. The telecom minister would not be unaware of the aforesaid details when he made his allegations.

It seems the attack on the institution of the CAG is politically motivated as the government is in a fix due to the opposition demand for a joint parliamentary committee on 2G and other scams and Parliament’s working has been stalled.

At the time of presentation of the Bofors report, the institution of the CAG was pilloried and a union minister called the CAG “that Charlie” and questioned his jurisdiction to conduct audit. When the report of the Bihar fodder scandal was presented to the legislature, Lalu Prasad Yadav, the then chief minister is reported to have said that the state’s Accountant General – the CAG’s representative – should be answerable for not detecting the fraud earlier and should be jailed. It is unfortunate that derisive references are made against the institution of the CAG when the government in power finds the audit observations uncomfortable.

For healthy development of the democratic polity, the political executive should respect constitutional offices and the checks and balances envisaged in the Constitution. The CAG works on behalf of the legislature to enforce the accountability of the executive. In India we follow the British parliamentary traditions. When the Constitution was framed in 1950, an independent office of CAG was established, whose reports are required to be submitted to Parliament/state legislature.

History of Parliamentary Control

Parliamentary control over the executive has a long and chequered history. In Britain, thanks to the missionary zeal of W E Gladstone, an Exchequer and Audit Department Act was promulgated in 1866, which created the office of the CAG, whose reports were required to be submitted to Parliament and examined by a select committee of its members, called the Committee on Public Accounts. This solved the dilemma which had baffled Parliament for centuries, “whether expenditure should be controlled by inexpert parliamentarians or expert non-parliamentarians”. In order to strengthen parliamentary control in Britain and raise his status, the CAG has been made an officer of the House of Commons, through an amendment of the National Audit Act in 1983. The British lead was followed by other Commonwealth countries, such as Australia, Canada and New Zealand and by amendment of respective Acts, the auditor generals in these countries have been made officers of the Parliament.

In the United States the Supreme Audit Institution (Government Accountability Office) since its inception is recognised as a legislative branch agency and enjoys a special working relationship with the Congress. For all practical purposes the position is similar in India. The CAG works on behalf of Parliament and is regarded as a friend, philosopher and guide of the Public Accounts Committee (PAC).

The chairman of the PAC, Murli Manohar Joshi, has termed the telecom minister’s remarks as “improper” and “inappropriate”, but it seems that the ruling Congress has taken this as an issue of a conflict between the ruling party and the opposition, rather than the undermining of a constitutional office. It is time that Parliament treats denigration of the institution of the CAG as an affront to Parliament and breach of its privilege and takes appropriate steps to maintain the dignity and independence of the institution of the CAG, so that he/she is able to perform his duties effectively, in larger interests of the people of the country.

Economic & Political Weekly

EPW
january 22, 2011 vol xlvI no 4

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