The office of the Comptroller and Auditor General or CAG is in the news. Hardly a week passes without a new report of the CAG appearing on newspaper front-pages highlighting acts of financial indiscretion leading to either revenue loss for the government or undue revenue gain for some private entities. Developments in the last four weeks alone are worth recounting here.
A CAG report, which is yet to be officially released, alleges that several legislators in the Maharashtra Assembly declared monthly income ranging between Rs 2,500 and Rs 12,500 to acquire large flats under the government quota in a co-operative housing society in suburban Mumbai. This comes soon after the CAG’s indictment of the Maharashtra government for lacking in a mechanism to periodically review the lands allotted to Maharashtra Industrial Development Corporation and other public sector enterprises.
Several other state governments also have come under the CAG’s critical gaze. Its report on Himachal Pradesh has noted that the state’s financial health had worsened with the rise in liabilities by 46 per cent in the last four years. In Andhra Pradesh, the CAG has rapped the state government over the allotment of over 20 acres of prime land to an institute promoted by film-maker Subhash Ghai in alleged violation of rules.
Even Gujarat, which boasts of an administration that is otherwise run efficiently, has not been spared. The CAG has pulled up the Gujarat government-run Gujarat State Petroleum Corporation (GSPC) for financial irregularities and undue favour to select companies such as Reliance Industries Ltd and Adani Enterprises Ltd. According to its report, GSPC has incurred losses of a little more than Rs 5,000 crore during 2006-2011 for exploration activities at its oil and gas block in the Krishna-Godavari (K-G) basin. In Orissa, too, the CAG’s report has criticised the state government for the manner in which it allotted land for six major industrial players including Posco India and Vedanta Alumnium.
The biggest of them all was a draft report of the CAG on allocation of coal blocks to private companies on a first-come first-served basis, ignoring advice that the coal ministry could amend its rules to facilitate auction of such natural resources instead of following the time-consuming option for amending the law. The draft report – the findings of which became a major controversy – has argued that undue revenue gain for the beneficiary private companies could be as high as Rs 10 lakh crore.
The frequency of the publication of CAG’s findings in newspapers and the prominence they are now commanding in terms of display and treatment in most news publications are now a subject matter of heated debate among senior officials in central ministries. Has the CAG become more active than usual? Has it crossed its brief by getting into areas of policy formulation instead of limiting itself to only financial irregularities? Or have the CAG’s recent reports created an impression that the Constitution-mandated body is deliberately targeting the United Progressive Alliance (UPA) government?
The fact is that the CAG has been doing its job with as much diligence now as in the past. There has also been no significant increase in the number of annual reports the office of the CAG produces in a year. What has changed is that the media today is more engaged with issues of financial irregularities in government bodies than before and the CAG reports help them bring these issues into sharper focus.
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Second, the CAG’s engagement with the media has also improved dramatically. In the past, CAG reports would travel a short and predictable distance from its office to Parliament, to be tabled there, and everybody would forget about what action was taken against the irregularities brought to light. Yes, the Public Accounts Committee of Parliament would submit its report on a remedial, but even these would mostly gather dust in government cupboards. There is a sea change in that approach now. Not only does the CAG’s office more aggressive in sharing copies of the reports once these are presented to Parliament, it now even holds news conferences to highlight the various financial irregularities for which it has pulled up the government. It is in these news conferences that the CAG has made clear its mandate as a result of which there is now little doubt about its role and jurisdiction. The UPA government may nurture doubts about the CAG’s role, but there is no such ambiguity in the minds of those who do the government’s auditing.
And those who may be tempted to accuse the CAG of targeting the UPA government should take a look at the reports that became the talking point in the last four weeks. It was not just the UPA government at the Centre, which came under attack, the state governments of Maharashtra (ruled by a Congress-led alliance with the Nationalist Congress Party), Gujarat (ruled by the Bharatiya Janata Party), Andhra Pradesh (ruled by the Congress) and Orissa (ruled by the Biju Janata Dal) also were rapped for financial irregularities. Surely, then, the CAG is just doing a job that our Constitution makers had mandated it to do.