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Give muscle to this paper tiger

The CAG was set up to examine, and question, how India’s governments work. But it has no punitive powers, so report after report is ignored, rendering it little more than a paper-pushing monolith. What it needs is the power to fine errant officials for delays, raid offices and seize documents, writes Neelesh Misra.Empower the CAG

india Updated: Jul 24, 2009 01:00 IST
Neelesh Misra

Don’t let this big office mislead you,” says the silver-haired official, as he leans over to pick up his coffee. “When I want to get information, I often feel far powerless than the ordinary citizen.” Empower the CAG

Located by a busy New Delhi street, this is the headquarters of the Comptroller and Auditor General of India, the constitutional body that can audit virtually any government office it wants, ask anything it wants.

Well, not quite.

It could have been truly the people’s voice, standing up to the government and fighting inefficiency and corruption. But the powerful Comptroller and Auditor General of India — which has the world’s largest auditing job — is not so powerful after all.

It is a toothless tiger.

Its mandate and access appear sweeping, but its audit findings are mostly ignored, and government offices often stonewall, delay or just don’t reply to its questions.

So we suggest a wide range of new powers for the CAG to make India's democracy work better.

Every year, the CAG meticulously finds faults — and sometimes bright spots — in the way governments do their work. Here are some of the recent findings:

n Government figures for the National Rural Employment Guarantee Act programme cannot be relied upon as record maintenance at the village level is poor.

n The Department of Atomic Energy did little to mine identified reserves of uranium over the past two decades though India has enough to run all its nuclear power reactors for four decades.

n Despite the telecom boom and massive funds, the Department of Technology did little to expand phone networks in India’s villages. In many states, one person in a hundred has a telephone, even now.

n The tourism ministry released

Rs 1,500 crore between 2002 and 2007 to the states to develop tourism infrastructure, but did little monitoring to prevent the money from being misspent.

n The Coffee Board, run by the commerce ministry, has done little to increase coffee productivity — it released no new varieties in the past quarter century. Farmers had to rely on pre-1980, pest-prone varieties. Production fell by up to 31 per cent.

In 15 years, the CAG has brought 9,000 such audit findings before Parliament. In some 3,000 such cases, the auditor didn’t get any response at all.

In most other cases, the response is dismissive or tardy — although, under the law, the government is required to respond within four months with an action-taken report.

That seems totally out of place in a nation that has given its citizens unprecedented transparency with the Right to Information Act, the world's largest information-seeking network, spanning every layer of government from the Prime Minister’s Office to that of the village headman.

"We don’t have access to information," said a senior CAG official, who spoke on condition of anonymity as he is not authorised to talk to the media. "Legally we do, but there are no penal provisions. So if they (government offices) don’t give us information, we have no way of forcing them to."

So we propose the CAG be given far more muscle — judicial powers, the power to impose punitive damages, and enlarge its role in new, emerging areas. This is not radical or unheard of. Most prominent nations have given their auditors far more powers than India has.

“Yes, the CAG could do with more powers, in the overall interests of the nation,” says former chief election commissioner J.M. Lyngdoh. “Making CAG more powerful and giving it new tools to adapt to the modern times will only help improve its efficiency and efficacy.”

Such powers would make the CAG an ombudsman working on behalf of the citizen, rather than just a paper-pushing monolith.

So the government should bring an amendment to the 1971 law under which the organisation was created, and give the CAG judicial powers to summon and take punitive action against offenders who fail to give it information within a deadline, say 15 days.

It should be empowered to deduct money from the salaries and wealth of corrupt and slothful officials, and raid offices and seize documents that otherwise often go missing. Even the Central Information Commission is empowered to impose penalties, and has semi-judicial powers.

We also suggest that the government expand the CAG’s jurisdiction to include public-private partnership projects, the financial sector and non-governmental organisations handling taxpayer money.

It should also be permitted to access personal wealth details of officials found guilty under audits.

In a highways project, for example, the CAG can audit the National Highways Authority of India but not the contractor building the project. And while the CAG can fault an office for inflating expenses, it cannot currently track whether that money went into personal accounts.

“Public sector banks are not audited. What the heck, even the Reserve Bank of India is not audited,” said another official. “It’s time they were.”

(With inputs from Kumar Abishek)

Empower the CAG

The Problem

It could have been truly the people’s voice, standing up to the government and fighting inefficiency and corruption. But the Comptroller and Auditor-General (CAG) of India is a toothless tiger. Its mandate and access appear sweeping, but its audit findings are mostly ignored, and many government offices delay or just don’t reply to its questions.

HT’s Fix
1) Give the CAG more powers and more funding to substantially increase its staff strength, and increase its domain.

2) Amend the CAG Act of 1971 and give the auditor judicial powers to summon and take punitive action against officials if they refuse to or are unable to give it — within 15 days — the information it has asked for.

3) In keeping with the spirit of the Right to Information Act, give the CAG powers to deduct monies from officials’ salaries if its audits find them corrupt or willfully inefficient.

4) The CAG should receive funds to set up an office in every district.

5) Bring Public-Private Partnerships (PPPs) — including the accounts of private companies taking part in public projects — under the purview of the CAG.

6)Bring the financial sector — including the Reserve Bank of India, Securities and Exchange Board of India (SEBI) and nationalised banks — under the ambit of the CAG.

7)Non-governmental organisations handling taxpayer money in development projects should be audited by the CAG.

8) Enable the CAG to raid offices, seize suspicious documents and access information related to the personal wealth of officials — including bank accounts and details of property holdings — if they are found involved in wrongdoing.


New Zealand

The Auditor General can access documents of public entities at all times. It can examine anyone under oath under the Crimes Act of 1961 — and it can recover costs and expenses of evidence-gathering from the government officials it is investigating. The country's auditor can ask officials for personal information and even inspect bank accounts.


The Auditor General is an independent officer of the Parliament appointed by the Governor General and supported by the Australian National Audit Office. This office has extensive powers of access to government documents and information.

The US

The Auditor General in the Government Accounting Organization can institute action in any federal court for not obeying his authority.

South Africa

The Auditor General has unrestricted access to books and assets of the subject of the audit. Armed with a warrant from a judge, it can search homes and offices and order people to disclose information under oath. Those who obstruct the auditor’s work or provide false data can be jailed for up to a year.


The National Audit Office is a ministry under the leadership of the prime minister. It has the authority to access accounts of individuals or institutions and freeze accounts and related activities in the event of alleged corruption.

Government Speak: Vinod Rai

Experts Speak

Figure conscious

Related links:

Understanding CAG

Prevention of Delay in Discharge of Official Duties Act, 2005

Civil service reforms by Centre for Good Governance, Hyderabad. M. Satish, Knowledge Manager's report

Sixth Pay Commission Report

Veerappa Moily panel suggests drastic changes to make bureaucrats accountable

Case study: United Kingdom