At present, the Comptroller and Auditor General of India is a single-member constitutional authority under Article 148. It has been suggested that it should be converted into a multi-member body or Audit Commission on the lines of the Election Commission.
The National Commission to Review the Working of the Constitution (NCRWC), often referred to as the Venkatachaliah Commission, suggested overhauling the existing centralized system by creating an Audit Commission.
5. Need for Collegiate Decision: Audit Commission
37. In most advanced democratic countries Audit Reports which are placed in Parliament are finalised through an Audit Board or Audit Commission system in which all the senior officers of the state audit department are represented. In Germany the Federal Court of Audit Act sets out the constitutional status of Bundesrechnungshof. All its members enjoy judicial independence and a constitutional status similar to that of judges. The Large Senate, which is the main decision making body, consists of 16 members and includes the President, Vice President and the Directors of Audit. In France the Cour des Comptes is presided by the Premier President and has seven chambers with 15 members. The Cour always acts as a collegiate body, whether in a judicial or non-judicial capacity. The draft annual reports on the accounts of the state and the management of the state services, agencies and companies are brought before the complete bench presided over by the President of the Cour. In Japan there is an Audit Commission consisting of three Commissioners. All major decisions pertaining to audit are taken by the Audit Commission, including finalisation of the Audit report. In Korea the Board of Audit is composed of seven Commissioners including the chairman. Decisions on policy issues, such as audit and inspection, are taken with the approval of the Council of Commissioners.
38. In our country there is no system of finalisation of audit reports through a formal committee system in which the Dy CAG/ Accountant General/ Principal Directors of Audit participate. The audit reports both of the Central and State governments are processed on files by the Dy CAG and Addl Dy CAG and approval of C&AG taken. The expenditure and revenue transactions of the government have increased hundred folds with tremendous growth in government's activities after independence. It is simply not possible for one individual viz. C&AG to be responsible for all audit work of Central as well as State government. There is need for wider sharing of responsibility. The existing system results in neglect of audit and poor quality of Audit Reports. There is also no system of discussion with Secretaries to government / heads of department before the Audit report is finalised. This leaves a yawning gap in the Report, facts and conclusions are often challenged with the result that the main purpose of audit viz. improvement of the administrative set-up and the systems and procedure takes a back seat.
A multi-member CAG should be considered only as part of broader institutional reform. Its members must be selected through a transparent, bipartisan process; possess clearly defined professional qualifications; have staggered tenures; and enjoy protection equivalent to the present CAG. Alternatively, the single-member structure may be retained while creating a statutory advisory board of domain experts and strengthening the institution’s staffing, technological capacity and legislative follow-up.
Sample Mains Question
1.“The Comptroller and Auditor General of India is not merely an auditor of government expenditure but an important instrument of legislative accountability.” Discuss the significance of the CAG in ensuring financial accountability. Also examine the challenges affecting its effectiveness and suggest measures to strengthen the institution.(250 words | 15 Marks)
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