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Updated: February 21, 2013 01:18 IST

Selecting the next CAG

Ramaswamy R. Iyer
Comment (21)   ·   print   ·   T  T  

Instead of the present opaque system, a high-level, broad-based Committee should be formed to choose the country’s “most important” constitutional functionary

In May this year, the present Comptroller and Auditor-General will retire on completing 65 years of age. Given the Government of India’s exasperation with him, it seems very probable that for the next CAG, it will look for someone who is likely to be bland and ignorable, and quite possibly someone who will actively weaken the rigours of accountability. That will be a travesty of what the Constitution-makers had in mind. How is that deplorable contingency to be avoided?

The answer is that the selection of the CAG must not be the exclusive prerogative of the executive government but must be entrusted to a high-level, broad-based Selection Committee. Such a course is clearly a very obvious one to follow, but it appears that the government does not consider any such change in the selection procedure necessary.

No formal criteria

The argument is that the existing system has been working well; that the CAGs, by whichever ruling party chosen, have been able to function independently; and that no change is called for. However, does a system in fact exist? There is no carefully formulated job description, no formally laid down criteria, no clear procedures for a long list and a short list, and no Selection Committee. What then is the system? It is entirely an internal process within the government; no one outside knows what that process is; from the Finance Secretary, Cabinet Secretary and the Principal Secretary to the Prime Minister, some names emerge and reach the Prime Minister; and a recommendation is sent to the President. Suddenly one morning the newspapers announce that a particular person has been selected as CAG. Parliament and the people of the country have no idea at all as to how the principal instrument of accountability is chosen.

Is the ‘system’ working well? On what grounds can one say so? There have been outstanding, good, and indifferent CAGs. One can hardly infer a functioning system from these results, much less one that is working well.

The need for a high-level, broad-based Selection Committee has already been accepted for the selection of the Central Vigilance Commissioner and the National Human Rights Commissioners. On what possible grounds can it be held that such a procedure is not appropriate for the selection of the CAG? It is in fact particularly called for in this case, considering the great and crucial importance of the institution of CAG of India. The point is familiar and need not be laboured, but it may be useful to remind ourselves very briefly that the Constitution-makers chose to include the position in the Constitution; guaranteed his (her) independence by providing protection against removal except by impeachment; and prescribed for the CAG an oath of office that requires the functionary to “uphold the Constitution and the laws” and not just act in accordance with them. It may also be recalled that Dr. B.R. Ambedkar considered the CAG the most important functionary in the Constitution, even more important than the judiciary. The CAG performs the most crucial function of enforcing the financial accountability of the Executive to Parliament, and through Parliament to the people. It follows that the selection of the enforcer of accountability should not be left to the discretion of those whose accountability he or she has to enforce.

What should be the composition of the proposed Selection Committee? Having regard to the multiple dimensions of the position of CAG, the following is a suggested composition:

• Prime Minister (Chairman);

• Finance Minister;

• Leader of the Opposition in the Lok Sabha;

• Speaker of the Lok Sabha;

• Chief Justice of India, if the CJI is willing to be included, and if not, a very distinguished legal luminary.

For an open system

Suggestions that criteria and procedures should be laid down for the selection of the CAG are sometimes questioned on the ground that the Constitution does not say so. That is an absurd objection. The Constitution mandates the post; an appointment has to be made to that post; an appointment implies a selection; and selection implies criteria and procedure. The appointment cannot be made by draw of lots. In any case, some kind of opaque internal system is apparently being followed at present. The suggestion is merely that it be replaced by a formal, well-formulated, open system.

Once we start on the formulation of a system of selection, several questions will arise. A full discussion of those questions will require a separate paper. Without a detailed discussion, this article will merely put down a few categorical, un-argued statements for consideration.

(1) What kind of person should the Committee look for? Keeping in mind the kind and range of responsibilities involved, the CAG should clearly have:

• professional knowledge and expertise in accounts and audit;

• a willingness to point the finger at irregularity, impropriety, imprudence, inefficiency, waste, and loss of public funds, at whatever level this occurs, but tempered by a scrupulous judiciousness in criticism and comment;

• the ability to weigh the legal and constitutional aspects of some of the issues that come before him;

• a capacity for understanding complex technical, contractual commercial, managerial, or economic matters and forming careful judgments, particularly when dealing with large government schemes or appraisals of public enterprises;

• management abilities for running the vast Department under him; and

• underlying all these, a passionate concern for rectitude and propriety (‘fire in the belly’), and impeccable and fierce personal integrity, accompanied by much tact and wisdom.

It will certainly be very difficult to find a person who combines all those elements; but the selectors must keep that ideal picture before them, and the person selected should meet at least a significant part of the above requirements.

(2) The criterion (now prevailing) that the person to be selected should have been a Secretary to the Government of India is irrelevant and should be abandoned. Indeed, having been a Secretary to the Government should perhaps be a disqualification because of the possibility of a conflict of interests.

(3) The fact that this is a constitutional position should not be allowed to obscure the fact that it is also a specialised, professional one that cannot easily be filled by a generalist. It is impossible to imagine a non-IFS officer being appointed as Foreign Secretary, or a non-railwayman as Chairman, Railway Board; appointing a generalist administrator as CAG should be equally unthinkable except in a rare case. The constitutional status of the position does not alter that logic.

(4) The retiring or recently retired Deputy CAGs in the IAAS should be the first source; it is only if an exceptionally able officer is not available from that source that other sources should be considered, i.e., the IAS and Central Services other than the IAAS; and failing all these, non-government sources.

The reasons for that order of preference are not gone into here. It must, however, be mentioned that the implicit general assumption that the next CAG, like the last six CAGs, must be an IAS officer, causes serious harm to departmental morale. Consider the high standing of the Indian Audit Department in the international community of Supreme Audit Institutions. Consider also the present CAG’s frequent praise — high praise — of the quality of the personnel of the Department. If such good work can be done by the Department, is it credible that in the last six selections of the CAG, the choice could never once fall on an IAAS officer? The sad fact is that the post of CAG has become virtually a cadre post for the IAS, and there seems to be a systematic exclusion of the IAAS. This is indefensible on any ground and needs to be remedied. This implies no reflection on any individual CAG. In particular, this writer holds the present CAG in the highest regard, and believes that he has been an outstanding incumbent of that high constitutional office.

The above suggestions are not offered in a dogmatic spirit. What is important is that the issues raised in this article should be pondered by all those who are concerned about the effective functioning of this venerable institution, even if that pondering leads to conclusions different from those stated here.

(Ramaswamy R. Iyer is a former IAAS officer)

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It’s a Clear-cut article detailing the prevailing system For CAG Position.
*) Clearly NON-IAAS Officers should not be entertained.
*) After Certain Level Of experience as IAAS Officer, He/She Should Undergo
Special Training (Which educates how to
Escalate imprudence, inefficiency etc of Governments Audit).
This Training can last up to 6 months to 1 year etc.
*) From All the trainees, Including Opposition party leaders consent
CAG person has to be appointed.
*) Remaining all criteria goes well with the author.

from:  J.anandhaKharthik
Posted on: Feb 22, 2013 at 16:00 IST

CAG is a constitutional body. It is meant to aid & assist Parliament.Therefore like other constitutional bodies or posts (except, Judiciary or future Lokpal)they are selected by executive & they work for or scrutinized by Parliament,a classic example "separation of power" .Therefore it is not necessary to have high level broad based committee for its selection. While in the case statutory bodies such as CVC,which exclusively works under or report to executive,it is prudent to have selection procedure based on Committee , comprising executive & others.Last not least who heads an institution (IAS OR IAAS) is an irrelevant question.Institutional efficiency is a matter of procedural competence rather than individual competence.

from:  Pranav Bhardwaj
Posted on: Feb 22, 2013 at 14:44 IST

This is a very important and hot issue now, how to select a CAG. Is
the previous selection process is better or it should be changed like
the selection process of CVC and NHRC Commissioners? In my view the
answer is that for such an high Constitutional post the selection
process should be done by a Committee based approach including one
high jurist, Lok Sabha Speaker, Opposition Leader in Lok Sabha and
Prime Minister as Chairman of the Committee. This process will be more
transparent and responsible. The other part is that the post should be
filled by an eminent Officer of any Cadre either IAS or IAAS but he
should be of high integrity and having good experience of auditing and
accounting at higher levels. The present CAG has done his job with
great integrity and sensitivity. I appreciate it.

from:  Sushil Kumar Tiwari
Posted on: Feb 22, 2013 at 13:49 IST

Our Fore Fathers who wrote the Constitution took an equitable decision
to ensure that the post of CAG is not in promotional avenue to any
particular service cadre. IAAS cadre can not therefore claim it as
it's own and that only officers of that cadre should be considered for
appointment to that post. Any person to hold the post of the CAG
should be one with a service record of outstanding ability and
impeccable integrity. For the government, to get such a person, the
field of choice should be wide open. All the persons who held the post
of the CAG since Independence have done meritorious jobs and the
recent exposures of financial irregularities clearly show that the
present CAG is under no influence of any pull or pressure from any
quarter. There is therefore nothing wanting to warrant a change in the
present procedure of selection and appointment to the post of CAG

from:  T.Sathyamurthi
Posted on: Feb 22, 2013 at 09:07 IST

The CAG post in our country has proved very important in throwing light on multi-crore coal- gate scam recently.. It can not be filled by a person who is inefficient and biased. The criteria in selection must be changed to make the post and its work more transparent. And the process of appointing a constitutional post should not be delayed. The procedure of selecting CAG must be like proposed Lokpal.

from:  Venkatraman
Posted on: Feb 22, 2013 at 01:03 IST

Timely article. Thank you. We have the example of how the election commission has been silenced by the Govt. There is no doubt that the UPA Govt is going to silence the CAG

from:  Sudheer
Posted on: Feb 21, 2013 at 13:39 IST

It is surprise that The Government, which is to be audited , appoints
CAG and IAS with no knowledge of Accounting & auditing be appointed cAG.
This post must go to an IAAS or a Chartered Accountant.

from:  Atma Gandhi
Posted on: Feb 21, 2013 at 12:10 IST

1. Aim of audit is self correction to live up to expected standard if
not found to be meeting the benchmarks of constitutional aims and
objectives required to be met as declared by the parliament itself.
2. Law makers and implementers are to have a conscience check regularly
to have a honest feedback on their own intentions and its actual on
ground effect wrt money/resources aquired/spent.
3. To have a critical appriser who is ironically harmful for the ruling
party due to the dyanmics of the media victimisation is the crux of
issue at hand.
4. It can be solved by media projecting the defect in the
system/process and available solutions rather than be fixated in un-
intellectual and non-problem-solving approach of sensationalism and
pseudo-intellectual debates of political radicalization approaches on
the same.
5.It is the media-masses interaction which has failed.
6. CAGs have done the job, whoever comes will do it correctly because
the constitutional provisions ensures it.

from:  Dr Haricharan
Posted on: Feb 21, 2013 at 11:57 IST

an amazing article, and the fact that it comes from a retired civil
servant who knows the nitty gritty of government's functioning add to it
credence.However, the author completely disregards the fact that the
present CAG which had been a constant source exasperation for the upa-2
had been selected the same way and that there are other bodies such as
the PAC and committee on public undertakings which complement the CAG
(who is not the sole authority on accountability)

from:  sushant
Posted on: Feb 21, 2013 at 11:45 IST

It is ok. The committee in general do not be a solution for fairness . I list the the requirements .
1. The Judiciary / Judges should not be included in the committee.
2. Non IAAS shall not be considered.
3. No private Management firm shall be deployed to look at One.
4. President and Vice President must unanimously be accepting. Else the selection must again go thru the One more round.
5. No info must be shared with press prior to appointment.
6. Secret Voting from Top Brass of the Office of CAG and State AG must be done , without giving publicity on the pre conditon that they must not be pre informed.
7. CEC must be part of this Selection Schematics.
8. PM and Opposition must only represent the Executive. no one else.

from:  Raghunath Acharya
Posted on: Feb 21, 2013 at 11:45 IST

Irrespective of whether there is a selection process or not for the most revered constitutional position, the selection panel should consider the basic criteria ie., whether the appointed one will be accountable to the people and the job to which he is committed. A biased selection will lead to nothing more than an institution working for the sake of constitutional validity. With the present CAG raising the bar of the qualities required for the postion with his bold views and opinions, expecting the upcoming CAG to atleast maintain the status quo.

from:  Shiva Kumar Adama
Posted on: Feb 21, 2013 at 11:15 IST

A very well written and thoughtful article. It is great opportunity for Govt of the day to try and
salvage their credibility,by acting in a bi-partisan manner while selecting an equally worthy
successor to present CAG. But, it appears short term (political) gains may cloud their
decision making, this time too. Like they did in the case of appointing new CBI head. This
despite so much of doubts being cast on neutrality of CBI and positive in-puts given by main
Opposition party BJP to form a committee to ensure impartial selection of CBI Head.
We, citizen of India hope that better sense may prevail and country gets a well deserving
person of high integrity and intellect gets the chance to head CAG. And, no attempts are
made to bifurcate CAG like it was done in case of Election Commission.

from:  Atul Rai
Posted on: Feb 21, 2013 at 11:11 IST

The suggestions put forth by author are worth consideration and every responsible citizen is concerned about transparency and accountablity of system and doesn't want them to remain hostage to political considerations.But the question is even if these suggestions are accepted and considered and CAG given independence and transparency is assured,what would be the dividends of that transparency when final authorities having discretion and own modalities to decide upon CAG's report are wholly executive influenced!Transparency is required at every stage- from beginning till end.To ensure that CAG needs to be given powers which it is worth of being an independent constitunal functionary.PAC should give due weightage to CAG's report else the very concept of audit and CAG appears just formality and our suggestions mere clichés!

from:  Shayesta Nazir
Posted on: Feb 21, 2013 at 10:41 IST

As always, Mr.Iyer has written a well conceived article taking care to
cover all points including the process of selection, qualifications for
the new CAG.I wish the government appreciates the validity of the
various points clarified by Mr.Iyer and make the right choice for the
successor to Shri Vinod Rai who has done an excellent work. We only
hope, with the selection committee with PM,FM,Speaker,Opposition leader
and CJI or a legal luminary, the post or posts( if this becomes a panel
like Election Commission), do not become political.

from:  ratnam
Posted on: Feb 21, 2013 at 10:15 IST

By appointing a pliable person as CAG, the UPA will be further harming its credibility or whatever is left of it.

from:  Hema
Posted on: Feb 21, 2013 at 08:20 IST

An excellent article. The suggestion to have a transparent system of selection brooks
no delay if one earnestly seeks the salience of our polity.

from:  E.Damodar
Posted on: Feb 21, 2013 at 07:52 IST

To my understanding we need a commitee.thanks for the article.let us know more.

from:  gowtham
Posted on: Feb 21, 2013 at 07:26 IST

I agree with most of what the author says. After what happened in the 2G scam, I am sure the government will try to fix up a meek, friendly CAG next time. This has to be stopped at any cost. A transparent procedure will ensure this. Also, in the selection committee probably there should be one more judge and maybe even some eminent social personality. The committee proposed is biased in favor of ruling government.

from:  dinotroll
Posted on: Feb 21, 2013 at 05:52 IST

An excellent, brief working paper on which informed discussion could
take place. The government establishment would certainly make all
efforts to have s 'bland and ignorable' successor. Goverfnment may toy
with the idea -as they did with CEC- a multi-memebr CAG! One point
the author has raised above needs consideration. It is decades since
the IA&AS had its memebr elevated to the judiciary. At any rate, the
new process should include a list of names-which shoulb be published=-
which would be considered by the new mecdhanism proposed. One thing
uppermost in our midns should be: be watchful if govt. tries to
circumscribe the role of CAG. One point I would like to differ from
the author is -why should we include the judiciary to be aprt of the
selection process. Keep them out.

from:  s subramanyan
Posted on: Feb 21, 2013 at 05:47 IST

Good recommendations. lets implement.

MK

from:  Mahesh Kuthuru
Posted on: Feb 21, 2013 at 05:27 IST

A good article. As a rule Governments choice of the CAG has been to reward courtiers. The record of our audit system has improved very slowly. Unfortunately contrary to the writers experience the auditors one has known were largely procedure oriented. Procedure is important but not everything. At the top of the profession to ask for experience in accounting makes little sense. This article in essence smacks of a cadre issue. Why not make the job truly open and include the private sector as source as well.

from:  acharya
Posted on: Feb 21, 2013 at 05:19 IST
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