Government wants CAG to be audited

Government wants CAG to be audited

The government may have the Controller General of Accounts (CGA), which functions under the finance ministry and maintains the accounts of Union ministries, audit the accounts of the Comptroller and Auditor General of India (CAG), said two persons familiar with the development.

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Both the persons spoke on condition of anonymity.

The proposed move comes in the backdrop of a slew of critical reports by the government’s statutory auditor, pointing to irregularities in the allocation of radio spectrum, the purchase of aircraft by state-owned Air India and an oil exploration deal with Reliance Industries Ltd. The United Progressive Alliance has been fighting allegations of widespread corruption.

A CAG spokesperson declined comment, while a CGA official pleaded ignorance.

Experts said such a decision, if taken, may not be received well.

“That gets more dangerously close to saying that if you throw bricks at us, we’ll throw them back at you," said well-known lawyer Harish Salve. “I think there needs to be a public debate on CAG being audited."

“There has to be some in-house check on the working of CAG, especially as some recent media reports have shown that there was internal dissent on the 2G (spectrum) issue. I think CAG needs to be audited, but that doesn’t mean the independence of the institution is lost," he added. “For that matter, the Supreme Court and Parliament are audited by the finance ministry, but they are independent institutions. CAG least of all should have anything to hide. In principle, if the accounts of CAG are audited, I don’t think there is anything wrong."

Mint had first reported internal dissent in CAG on quantifying the loss to the exchequer in the alleged 2G telecom scam.

But such a move may have political repercussions.

“In the public eye, it will only be seen as an attempt to intimidate a constitutional body trying to expose corruption," said G.V.L. Narasimha Rao, political analyst and member of opposition Bharatiya Janata Party’s electoral reforms committee.

In June, former comptroller and auditor general V.K. Shunglu, who headed the committee that investigated alleged irregularities in the 2010 New Delhi Commonwealth Games, raised the issue of auditing CAG. Shunglu had recommended an external audit of the auditor under the supervision of Parliament’s public accounts committee.

CAG currently does not have a dedicated internal wing to audit its functioning. However, it conducts an annual audit by a senior officer and is currently undergoing an external audit by the Australian National Audit Office, said a CAG official, who requested anonymity.

CAG had undergone a similar exercise in 2003, which was conducted by the UK’s National Audit Office. The findings of these reports are not available in the public domain.

“How can CGA audit us?" the CAG official asked. “It is not an auditing body and we audit the accounts book of ministries prepared by them."

“I think there is a need for a performance audit of CAG, in terms of the internal guidelines, audit mechanism, etc.," said A.K. Thakur, former deputy comptroller and auditor general and a member of the Shunglu panel. “But it should not be done by any government agency. It should be an independent organization."

“Had I been the CAG, I’d have asked an independent body to do both performance audit and financial audit," Thakur said.