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LATEST NEWS UPDATES | What Shunglu report? It’s plain anger -Ramaswamy R Iyer

What Shunglu report? It’s plain anger -Ramaswamy R Iyer

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published Published on Nov 17, 2012   modified Modified on Nov 17, 2012
-The Hindu

The intention behind the move to make the CAG a multimember body is not to activate the Shunglu Committee’s report but a desire to clip the auditor’s wings

During the last few days there have been many comments on the report that the government of India was considering a proposal to make the Comptroller and Auditor General of India (CAG) a multimember body. The move has been widely seen as a maladroit one. Most of the points that need to be made in this regard have been made succinctly in the excellent editorial in The Hindu on November 13, 2012 [“Controlling the auditor”]. This article will deal with some of the issues not covered in the comments that have appeared so far.

If one looks at Supreme Audit Institutions (SAIs) around the world, one will find both single-member SAIs (e.g., the United Kingdom, the United States, Canada, etc) and multimember bodies such as Audit Commissions or Courts (France, Germany, Japan, Indonesia, the Philippines, etc). Both forms seem to be working well. There seems to have been no general or widespread debate on the form of the SAI. Single-member or multimember, whichever form a country starts with seems to stay unchanged. There seems to be hardly any basis for supposing that the SAI works better in countries with the multimember form than in countries with the single-member form.

Hypothetically speaking, if in India we had started with a multimember SAI, we would probably have stayed with it. As it happens, the U.K., the U.S., Canada, etc, have single-member SAIs, and we adopted that pattern. One has not heard that there has been dissatisfaction in England or America with the form of the SAI and a desire to change it. Why then should we depart from that well-established pattern? It cannot be said that the Indian Audit Department has not been functioning well. It is internationally well regarded, is a highly respected member of the International Organization of Supreme Audit Institutions (INTOSAI) and its Asian counterpart, the Asian Organization of Supreme Audit Institutions (ASOSAI), and is performing an important role as auditor of several United Nations bodies. What then is the need for a structural change?

Case of the Election Commission

If the idea of making a change has emerged in India from the feeling that there has been an “overreach” by the CAG, the critics should take a look at the subjects of the audit reports of the National Audit Office in the U.K. and the Government Accountability Office (GAO) in the U.S. Their scope and range are breathtaking.

The important change in the history of the Election Commission (EC) was its greater public visibility after T.N. Seshan’s tenure. He made it fully aware of its own strength. This has nothing to do with its structural form. The EC has continued to function reasonably well after the change to a three-member body, but quite possibly, it would have done so even if it had continued as a single-member body. It is very difficult to say that the conversion into a three-member body has meant a marked improvement in its functioning. This is largely a question of the functioning of the individuals constituting the commission. On the other hand, there have been reports of dissensions within the commission from time to time. One can at the most make the negative claim that those dissensions, which must have made the functioning of the commission difficult, did not succeed in paralysing it. The history of the EC provides no clear answer as to the comparative merits of a single-member body and a multimember body.

Theoretically it could be argued that a collegiate form is better, but in practice there seems to be no compelling or urgent reason for a change. Assuming that there is a case for a collegiate form, that is not the most urgently needed reform, if it is a reform at all. What is more important and urgent is the need to respect the CAG as a constitutional functionary (the most important constitutional functionary according to Dr. Ambedkar); refrain from denigrating it in an unseemly fashion merely because its reports make the government uncomfortable; accept the accountability that it enforces as mandated by the Constitution; strengthen its hands in every way; take its reports seriously and respond with due corrective action; ensure that the selection of this high functionary is based on proper criteria and procedures; make the selection transparent and bipartisan; and so on. To ignore all this and advocate structural change is frivolous if not disingenuous.

It has been stated that the Shunglu Committee has recommended it. One wonders whether that committee had any business at all to recommend structural changes in the CAG’s organisation. Be that as it may, the fact that Mr. Shunglu made some recommendations is of no great consequence. (One recalls his controversial reports on IIM Ahmedabad and on the rehabilitation issue in the Sardar Sarovar Project.) The case for a multimember SAI needs to be examined carefully. As has been argued above, it is not established, and is far from being urgent.

It is clear that what lies behind this move is not the Shunglu Committee’s report but anger with the present CAG and a desire to clip his wings, just as it was the desire to hamper Seshan’s functioning that led to the conversion of the single-member Election Commission into a three-member body. This has been recognised by all, and need not be laboured.

The analogy with the Election Commission is imperfect. The Constitution provided for the possibility of a multimember Commission, and left the choice to the government. The EC started as a single-member body and continued so for many years, and then was made into a multimember body, under the existing constitutional provisions. There is no parallel enabling provision in the Constitution under which the CAG can be made into a multimember body. Such a conversion would require a constitutional amendment. With a hundred things on its hands, why should the government even think about undertaking a major constitutional amendment of this kind at this stage? This in itself is sufficient ground for suspecting the motivations behind this idea.

Further, the danger of initiating fundamental structural changes in this hoary institution is the opportunity and the temptation that it would provide to wipe the slate clean and rewrite the CAG’s charter, downgrading and diminishing the institution. One suspects that that is not just a “danger” but is in fact the intention. If that suspicion were true, what a travesty it would be of the noble vision of this institution entertained by Dr. Ambedkar, Dr. Rajendra Prasad, Dr. Radhakrishnan, C. Rajagopalachari, T.T. Krishnamachari and others.

Questions

Finally, three questions for constitutional experts:

1. It was surely not through inadvertence or forgetfulness that the Constitution provided an option of a multimember Election Commission but did not do so in the case of the CAG. We must presume that this was a deliberate distinction. If so, would it be right to obliterate that distinction by an amendment?

2. A constitutional amendment that would convert the single Comptroller and Auditor General of India into the head of a multimember body (whatever the name) will be a major structural change. If so, presumably it can only be brought into effect for future appointments and cannot be made applicable to the present incumbent appointed under the existing provisions. If so, would the government still be interested in the amendment?

3. The sections relating to the CAG are not specifically mentioned in Article 368(2) of the Constitution which requires ratification of amendments by not less than half the State legislatures, presumably because the Constitution-makers did not expect those provisions to be amended. However, would not any constitutional amendment affecting the institution of the CAG (who is CAG for the States as well as the Centre) require consultation with the States, even if 368(2) does not apply?

(Ramaswamy R. Iyer is a former Secretary, Water Resources, Government of India.)

The Hindu, 16 November, 2012, http://www.thehindu.com/opinion/lead/what-shunglu-report-its-plain-anger/article4098791.ece?homepage=true


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