Voice in the wilderness

Among the institutions in which Indians can justly take pride is the constitutionally mandated office of the Comptroller and Auditor General. Its reports often provide the only clear window to the way the government handles important schemes and projects, a government that notoriously tends to obfuscate and create smoke screens in order to deny information. This is especially true about the ministry of defence, where secrecy comes as naturally as breathing. The latest CAG report on the army's purchase of foreign weaponry establishes factually what many have known intuitively for long: that the army's overseas procurement process has grave systemic flaws. The report reinforces the conclusions of a group of ministers which recommended new systems in the aftermath of the 1999 Kargil conflict. But the most important of those changes have not yet been implemented. With the CAG having played its role and the report having been tabled in parliament, the ball is now in the court of the Public Accounts Committee (PAC), which has the powers to investigate further. The PAC, under the leadership of Mr V K Malhotra, has already decided to take up several of the latest CAG audits, among them performance audit on capital acquisitions, for further discussions.

According to established procedure, PAC members are now likely to go on field visits to the units and formations where the audit took place, after which the defence secretary and the senior officer in charge of procurement could be asked to appear before the PAC. If the committee considers the matter serious enough, it could be raised for discussion in the House. Parliament could well use such a discussion to provide new impetus to the earlier group of ministers' recommendations to evolve a clearly defined system, tailor-made to respond to different situations, for buying foreign arms. Considering parliament's track record, however, it is more likely that the CAG's painstaking audit will be reduced to an hour or so of shrill accusations and mud slinging.

While a CAG report has on occasion driven change through the PAC, people inside the system are not optimistic in this case. They point to the excellent CAG report, tabled before parliament in 2001, highlighting an extra Rs 2,175 crore paid for purchases during the Kargil conflict. The follow-up to that report was getting nowhere until one Mr Dhananjay Kumar filed a case of public interest litigation in the Supreme Court, alleging that no action was being taken on the CAG report. The investigation thereafter came back to life, prompting a CAG auditor to remark that "the PIL is a better option than the PAC" in getting things done. The CAG carries out three different kinds of audit in an ascending order of intensity, with "performance audit" being the most rigorous. The latter samples a cross-section of transactions to monitor the performance of one dimension of an entire organisation based on the three Es: effectiveness, efficiency and economy. The CAG's performance audit of the army's capital acquisitions examines every procurement decision from 1993 to 1996. Thus, while the CAG does much to make its audits meaningful, it remains the job of others to transform its reports into substantive organisational changes. Parliament's job of ensuring that public money is well spent is entrusted to the PAC and it relies on the CAG's reports to discharge this function. At the end of the day the CAG can only report, it is Parliament that has to act.