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Updated: November 17, 2012 00:18 IST

What Shunglu report? It’s plain anger

Ramaswamy R. Iyer
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The intention behind the move to make the CAG a multimember body is not to activate the Shunglu Committee’s report but a desire to clip the auditor’s wings

During the last few days there have been many comments on the report that the government of India was considering a proposal to make the Comptroller and Auditor General of India (CAG) a multimember body. The move has been widely seen as a maladroit one. Most of the points that need to be made in this regard have been made succinctly in the excellent editorial in The Hindu on November 13, 2012 [“Controlling the auditor”]. This article will deal with some of the issues not covered in the comments that have appeared so far.

If one looks at Supreme Audit Institutions (SAIs) around the world, one will find both single-member SAIs (e.g., the United Kingdom, the United States, Canada, etc) and multimember bodies such as Audit Commissions or Courts (France, Germany, Japan, Indonesia, the Philippines, etc). Both forms seem to be working well. There seems to have been no general or widespread debate on the form of the SAI. Single-member or multimember, whichever form a country starts with seems to stay unchanged. There seems to be hardly any basis for supposing that the SAI works better in countries with the multimember form than in countries with the single-member form.

Hypothetically speaking, if in India we had started with a multimember SAI, we would probably have stayed with it. As it happens, the U.K., the U.S., Canada, etc, have single-member SAIs, and we adopted that pattern. One has not heard that there has been dissatisfaction in England or America with the form of the SAI and a desire to change it. Why then should we depart from that well-established pattern? It cannot be said that the Indian Audit Department has not been functioning well. It is internationally well regarded, is a highly respected member of the International Organization of Supreme Audit Institutions (INTOSAI) and its Asian counterpart, the Asian Organization of Supreme Audit Institutions (ASOSAI), and is performing an important role as auditor of several United Nations bodies. What then is the need for a structural change?

Case of the Election Commission

If the idea of making a change has emerged in India from the feeling that there has been an “overreach” by the CAG, the critics should take a look at the subjects of the audit reports of the National Audit Office in the U.K. and the Government Accountability Office (GAO) in the U.S. Their scope and range are breathtaking.

The important change in the history of the Election Commission (EC) was its greater public visibility after T.N. Seshan’s tenure. He made it fully aware of its own strength. This has nothing to do with its structural form. The EC has continued to function reasonably well after the change to a three-member body, but quite possibly, it would have done so even if it had continued as a single-member body. It is very difficult to say that the conversion into a three-member body has meant a marked improvement in its functioning. This is largely a question of the functioning of the individuals constituting the commission. On the other hand, there have been reports of dissensions within the commission from time to time. One can at the most make the negative claim that those dissensions, which must have made the functioning of the commission difficult, did not succeed in paralysing it. The history of the EC provides no clear answer as to the comparative merits of a single-member body and a multimember body.

Theoretically it could be argued that a collegiate form is better, but in practice there seems to be no compelling or urgent reason for a change. Assuming that there is a case for a collegiate form, that is not the most urgently needed reform, if it is a reform at all. What is more important and urgent is the need to respect the CAG as a constitutional functionary (the most important constitutional functionary according to Dr. Ambedkar); refrain from denigrating it in an unseemly fashion merely because its reports make the government uncomfortable; accept the accountability that it enforces as mandated by the Constitution; strengthen its hands in every way; take its reports seriously and respond with due corrective action; ensure that the selection of this high functionary is based on proper criteria and procedures; make the selection transparent and bipartisan; and so on. To ignore all this and advocate structural change is frivolous if not disingenuous.

It has been stated that the Shunglu Committee has recommended it. One wonders whether that committee had any business at all to recommend structural changes in the CAG’s organisation. Be that as it may, the fact that Mr. Shunglu made some recommendations is of no great consequence. (One recalls his controversial reports on IIM Ahmedabad and on the rehabilitation issue in the Sardar Sarovar Project.) The case for a multimember SAI needs to be examined carefully. As has been argued above, it is not established, and is far from being urgent.

It is clear that what lies behind this move is not the Shunglu Committee’s report but anger with the present CAG and a desire to clip his wings, just as it was the desire to hamper Seshan’s functioning that led to the conversion of the single-member Election Commission into a three-member body. This has been recognised by all, and need not be laboured.

The analogy with the Election Commission is imperfect. The Constitution provided for the possibility of a multimember Commission, and left the choice to the government. The EC started as a single-member body and continued so for many years, and then was made into a multimember body, under the existing constitutional provisions. There is no parallel enabling provision in the Constitution under which the CAG can be made into a multimember body. Such a conversion would require a constitutional amendment. With a hundred things on its hands, why should the government even think about undertaking a major constitutional amendment of this kind at this stage? This in itself is sufficient ground for suspecting the motivations behind this idea.

Further, the danger of initiating fundamental structural changes in this hoary institution is the opportunity and the temptation that it would provide to wipe the slate clean and rewrite the CAG’s charter, downgrading and diminishing the institution. One suspects that that is not just a “danger” but is in fact the intention. If that suspicion were true, what a travesty it would be of the noble vision of this institution entertained by Dr. Ambedkar, Dr. Rajendra Prasad, Dr. Radhakrishnan, C. Rajagopalachari, T.T. Krishnamachari and others.


Finally, three questions for constitutional experts:

1. It was surely not through inadvertence or forgetfulness that the Constitution provided an option of a multimember Election Commission but did not do so in the case of the CAG. We must presume that this was a deliberate distinction. If so, would it be right to obliterate that distinction by an amendment?

2. A constitutional amendment that would convert the single Comptroller and Auditor General of India into the head of a multimember body (whatever the name) will be a major structural change. If so, presumably it can only be brought into effect for future appointments and cannot be made applicable to the present incumbent appointed under the existing provisions. If so, would the government still be interested in the amendment?

3. The sections relating to the CAG are not specifically mentioned in Article 368(2) of the Constitution which requires ratification of amendments by not less than half the State legislatures, presumably because the Constitution-makers did not expect those provisions to be amended. However, would not any constitutional amendment affecting the institution of the CAG (who is CAG for the States as well as the Centre) require consultation with the States, even if 368(2) does not apply?

(Ramaswamy R. Iyer is a former Secretary, Water Resources, Government of India.)

More In: Lead | Opinion

If only multi-member body be allowed to function in case of CAG, one
can imagine how this will lead us into -

- Number of members will be increased from time to time;
- There will be an uproar for inclusion of Lok Sabha / Rajya MPS;
- Regional Parties will fight for place in the body;
- There will be demand for compulsory provision for and inclusion of
women as also reservation for backward classes.

So, any probe in or auditing of Govt. spending will go around in never
ending circles.

from:  Madhu
Posted on: Nov 19, 2012 at 00:57 IST

Let us for a moment leave behind the debate about the implementation of
the suggested idea of transforming the single-headed CAG into a multi-
headed body. Post this activity, let us ask one simple question, why
now? All these years the GoI was doing fine with the solitary CAG and
suddenly there is an uncanny sense of urgency prevailing amongst the
ruling party to enforce amendments. The verdict/ report of the CAG has
been taken personally by some in the ruling party, and they are
justified in doing so!Shared corruption charges, nevertheless remain an
allegation.The motive behind this initiation of a reform process in the
structure of the CAG is two-fold 1.If implemented the government can be
assured of diversifying it's risky venture in the domain of
corruption.One honest CAG is not rare but a threesome honest
combination of bureaucrats is an inimical event.2. The government can
safely rest the corruption allegation put forth by the CAG to a faulty
systemic failure in the SAI.

from:  Upasana
Posted on: Nov 18, 2012 at 22:57 IST

Considering the performance of the current government, would strongly recommend that we make the office of the Prime Minsiter as a multi member body. At least, one member would have raised the public interest issues and protested the loot.

from:  Shekhar
Posted on: Nov 18, 2012 at 19:36 IST

The Congress Party is for ever planning to continue in power
and is not at all happy with the CAG exposing scams. What Mr.R
R Iyer has rightly pointed out is that they want to dilute the
powers of the CAG so that they can loot public money without
any questions being asked. Most politicians are corrupt and
when the Constitution was framed in the 50's nobody ever
dreamt that this would happen.

from:  S N IYER
Posted on: Nov 18, 2012 at 02:42 IST

The alleged attempt to change the CAG into a multi-body org is
a useless effort aimed at diluting the very Audit Body. The CAG merely audits the important transactions of the Govt & offers its views & suggestions to rectify the fault if any in the transactions already made. It works like a braking mechanism. NO moving body can
work without a braking system otherwise, it will move without any control and destroy whatever it comes across. Only with the safety mechanism in view, our Constitution was composed. Trying to critisize
the CAG, intimidating it by any means will only result in the failure
of the very purpose it serves & ultimately, the whole Governmental
system will collapse. Will the Govt try NOT to jeopardise the whole
Govt.mechanism??? by changing the CAG into a multi-member body.

from:  paddyfather
Posted on: Nov 17, 2012 at 18:49 IST

thanks Mr. Iyer ,but i dont understand if a multimember CAG could be of
any help to Govt. In fact their functions would be unalterd. The
Institution will all be the same ,with one or two subordinates and as
you mentioned multimember is working equally well in other parts of the
world. No problem if Govt .thinks it this way .let them go ...its not
going to lessen any burden for Govt but could do the same for

Posted on: Nov 17, 2012 at 12:27 IST

if the ruling party faces any difficulty with any consitutional body they want to clip its power by making it multi member body,when they felt former election commissinor T.N.Seshan was inconvenient to the ruling party they made it multi-member party.
they are very selfish fellows,no regard to any constitutional body.

from:  l.smohandoss
Posted on: Nov 16, 2012 at 22:27 IST

Why exactly we require multi member CAG body ? Rather we have to infuse
more transparency and modern tools of data administration for every
government program at various levels of implementation.Our IT companies
are world's pride and their support being admired heavily for the successful conduct of MNC's, why we still hesitate to consult them in
straightening our basic institutions like CAG. If this is what the
government wants then we should applause the timely action...

from:  sameer.m.s
Posted on: Nov 16, 2012 at 19:17 IST

The Congress has become more restless with more and more scams brought
out by CAG. In as much as 2014 is fast approaching, they carry the
apprehension in their minds. It is simple to understand why they want
the CAG is multi member body because one or two may dance to their tunes
just like the CEC. Make the CEC as a single member body. The country
will have clean legislators and parliamentarians.

from:  Kannan
Posted on: Nov 16, 2012 at 19:14 IST

Mr Iyer, thanks for the article... after a long time I have read some thing that has given me such a level of satisfaction....

from:  shekhar
Posted on: Nov 16, 2012 at 19:03 IST

I have a feeling if the Union Govt does decide to make an amendment to change the CAG into a multi-member body, it won't face any difficulties. For all the hue & cry BJP makes, you can be sure it won't oppose any such amendment. Its a tragedy that the prinicipal national parties of our country don't have any priniciples.

from:  shailendra rai
Posted on: Nov 16, 2012 at 18:14 IST

Why not make the post of PM also a committee of 3 members? There is no
end to argument single member or multiple member institution is better!!

from:  Ram
Posted on: Nov 16, 2012 at 17:47 IST

an excellent article....with great humility i think we should add some even larger questions to those already mentioned by the writer:

1. Does making some thing a constitutional body increase its autonomy and effective functioning??
- given the blatant disregard for both the PAC and the CAG itself, there have been instances where many have come out openly in the media criticizing the reports of the CAG and even when the matter is being considered by the PAC.

2 Doesn't this amount to contempt of CAG (denigrating his office) and also contempt of parliament(as the matter is under the consideration of the PAC) ??

3. Given the fact that CAG is only an instrument of parliamentary democracy ensuring the exercise of financial accountability of executive to the parliament. so isnt the PAC or the parliament responsible to clarify the allegations on the CAG(which is an instrument of parliament) as soon as possible before

Posted on: Nov 16, 2012 at 17:44 IST

What is actually meant by Multi Member and a Single Member body.

I would like to know what is difference in Single Member and Multimember
bodies. Does the difference exists in Centre only and Central and state
Govts involvement or .. ? I don't understand clearly, can anyone please

from:  Arjun
Posted on: Nov 16, 2012 at 16:30 IST

The tragedy of India today is the coalition stitched by the ruling party
to support its divide and rule policy. It is using CBI and other central
institutions to threaten opposition leaders to gather support for its
continuation in chair. This has been the practice of all parties. CAG
must be untouched. Public protests must start right now. So that
opposition parties will get the signals to stop the multi-member CAG
bill in parliament.

from:  Prof.A.Prabaharan
Posted on: Nov 16, 2012 at 16:18 IST

The article by Ramaswamy Iyer was highly informative and introspective
regarding, making CAG a multimember body.Specially, his three
questions to constitutional experts are worth mentioned. An ordinary citizen looking at article 148(3)[[which includes"Provided that neither the salary of a Comptroller and Auditor General nor his rights in respect of leave of absence, pension or age of retirement shall be varied to his disadvantage after his
appointment"]] wonders why there was an inclusion of such a clause in the constitution.It clearly showcases the labour taken by our founding fathers of constitution to face any adverse situation in future , but to held the constitutional position of CAG high and respectable. No doubt ,Constitution of India proves to be a living document even after so long years .Political class should not
try muzzle the provisions to suit their ulterior motives.

Posted on: Nov 16, 2012 at 15:43 IST

The inaugural speech of New Chinese leader Mr. Xi Jinping confirms that both China and India are facing pressing issues like social unrest, environmental degradation and corruption at
high levels. But there, the new leaders have clearly understood the
causes and assuring to take remedial steps. But in India, unfortunately,
it is not so, why?

Posted on: Nov 16, 2012 at 13:54 IST

Apropos the frequent comments by politicians that the CAG's remit is income and expenditure and not "policy", it needs to be emphasized that Income and Expenditure are as much an expression of "Policy" as they are vehicles of Government profligacy and corruption. These elements are an indivisible manifestation of "Government"

from:  S. Suchindranath Aiyer
Posted on: Nov 16, 2012 at 11:00 IST

Author is right in saying that there is no enabling provision in the Indian Constitution under which CAG would be made a multimember body and conversion would require constitutnal ammendment.There is really no need for conversion as drafters of constitution were 'men of noble vision'and their niceties cannot be questioned.Though in a democracy any new improvement needs to be discussed and debated but CAG is doing good work singly and timing of conversion is questionable.It is said that conversion would strengthen CAG as there would be proper exercise of an idea because of clash of ideas in multimember CAG leading to a unanimous decision.But report of CAG is otherwise not final also as PAC has final say in it and,therefore,there is no need of preunanimity.

from:  Shayesta Nazir
Posted on: Nov 16, 2012 at 10:49 IST

The Shunglu report was intended as a safety valve. India, over sixty
five years, has been stripped of most of the competence and integrity
to attempt any meaningful governance. The little that threatens the
men and women of straw who have risen to rule are being curbed in
manifold ways. The "troika" system that was put in place to ensure
that Election Commission would remain a tame hand maiden of the powers
that be (try to get a "Voter's ID Card") after Mr. Seshan enforced
free and fair elections in India. One swallow does not a Summer make,
hence the suggestion of a Triumvirate of Comptroller and Auditor
Generals. What might well be on the cards is a hydra headed RBI which
can be encouraged to turn a blind eye to inflation (that is stoked by
Govt profligacy and corruption) and cut interest rates and reserve
ratios at the behest of India's ruling (looting) elites.

from:  S. Suchindranath Aiyer
Posted on: Nov 16, 2012 at 10:48 IST

CAG is the constitutional authority and it should have full powers to
look into all aspects of government transactions. Any proposal to
reduce operational freedom of this authority or weaken its powers must
be straight away rejected. Any change in provisions relating to
appointment of this authority must be widely debated before they are
considered by the Parliament.
One major concern with regard to the government administration, of
all the Central, State and local self governments, is lack of
transparency in government expenditure and revenue. Citizens wish to
know more about the way in which the expenditure is incurred but have
no way to find out how much of the expenditure is just wasteful.
Citizens must be in a position to curb this waste. Therefore, it is
the right time to strengthen the CAG with modern tools of data
management and is able to catch the guilty at the initial stage, when
the losses to the exchequer can be minimized, it would be the right
step forward.

from:  Narendra M Apte
Posted on: Nov 16, 2012 at 08:43 IST

Simply unbiased and impeccable write-up.

from:  Vyas K Susarla
Posted on: Nov 16, 2012 at 08:17 IST

Really nice article which makes you think if there is any scope of
speaking the truth in the country. This move by the "Congress"
government is just another attempt to bring an efficient and honest CAG
within the folds of rest of the corrupted machinery.

from:  Nishant Kumar
Posted on: Nov 16, 2012 at 07:49 IST

yes , gov. (congress party) wants to cut the wing of CAG bcoz CAG opened
their secret of corruption............

Posted on: Nov 16, 2012 at 07:30 IST

It is difficult to escape the impression from the manner in which a Minister, known
for his 'freedom of speech' spoke about this multi-headed CAG and retracted the
statement that it is a well-concerted kite-flying to scotch any public opinion for
reverting to the earlier practice of appointing IAAS men to this post.

from:  Soundararajan Srinivasa
Posted on: Nov 16, 2012 at 07:29 IST

Mr. Iyer deserves to be congratulated for an excellent article on a very contentious issue. Seshan's greatest contribution was to make the EC as well as the public realise the vast powers that the makers of the Constitution had bestowed on the EC in their profound wisdom. Prior to Seshan nobody knew that EC existed and after Seshan nobody has missed Ec at the time of elections. RTI has provided further ammunition in the hands of social activists. The present CAG has aroused the people of India regarding the possible wrong doings of the government of the day. People expect the government to set things right and establish good
governance. As Mr. Iyer says, multi member CAG may not after all be harmful to the Republic, but can a minority government which survives on daily basis through political machinations have the temerity to talk of constitutional
amendments without raising the needle of suspicion. Only time will tell as to which way the needle will swing.

from:  velamur
Posted on: Nov 16, 2012 at 03:07 IST

To answer the three questions posed from a purely legal point of
1. The point of the amending power in the Constitution was to enable Parliament, if the need arose, to amend parts of the Constitution and not necessarily be bound by the Constitutional choices made at inception. However, the SC has made an exception to this principle by stating that the "Basic Features" of the Constitution cannot be amended out of existence. The structure of the CAG is not one such feature.
2. Assuming an amendment is brought about on the lines suggested,
the present incumbent would continue as one of the CAGs, giving
Parliament (or any other body) the power to nominate two or more
such CAGs. I don't see why the present incumbent would be removed
automatically by changing the nature of the body.
3. Art 368(2) exists to protect certain federal features of the
Constitution from being tampered with by Parliament. The CAG is
not one of them. Politically advisable, but not legally

from:  Alok
Posted on: Nov 16, 2012 at 01:01 IST
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