Don’t Undermine The CAG

There’s an old Chinese saying “when the finger points at the moon, the foolish looks at the finger.”

Some from the Government - the executive - have attempted a not so credible attempt at portraying the Supreme Court and the CAG – the two institutions that have spotlighted the recent scams within Government – as having tread on the turf of the Executive. The argument is that there is enough oversight of the Executive by the Parliament through Question Hours and Debates. And on the face of it, this seems like a reasonable proposition.

Parliament’s oversight of the Government or executive is very weak. The executive can get away with the malfeasance big and small - with very little opposition from the Parliament – because of the very nature of Parliamentary democracy which gives the executive the majority in Parliament, and hence, the ability to ignore any opposition. Further, any effort of oversight by the opposition, however ineffective, can only occur with the help of reports of constitutional authorities like CAG. No Member of Parliament or Political party tasked with the responsibility of oversight can function without reports and conclusions of the CAG and other consitutional bodies. To imply the CAG must do only accounting is as ridiculous as suggesting that a statutory auditor should restrict itself to just accounting the numbers. The last auditor that did that was the Satyam Auditors who now find themselves in jail accused of aiding and abetting the fraud.

The fundamental truth of our constitutional democracy is that – and this is obvious from any reading of the Constitution and speeches in the Constituent Assembly debates - our Constitution does not provide unfettered power of decision making on any institution, including the Executive, and relies on a system of checks and balances. CAG and judiciary are part of that system of checks and balances. To quote Dr. Ambedkar “I am of the opinion that this office (CAG) is probably the most important officer in the Constitution of India”.

The argument of a consitutional crisis caused by accountability demanded by the CAG and Supreme Court from a Council of Ministers is an obvious smokescreen.Mercifully, our Constitution is clear enough to deliver us from the evil of an imaginary constitutional crisis.

Since a senior Cabinet Minister imagines determining ‘policies’ as his exclusive domain, it helps to ask: what, precisely, are policies? The term ‘policy’ usually implies some long-term purpose in a broad subject field (e.g. nationalisation or privatisation of coal mining), not a series of ad-hoc decisions. Sometimes, however, we conceive of policy not so much as actively purpose-oriented, but rather as a fairly cohesive set of responses to a problem that has arisen (eg. competitive bidding for any procurement).

The existing judgements of courts and the opinions of constitutional authorities have to necessarily be taken into account by the Council of Ministers and by private members while framing or formulating such policies as law.

The Council of Ministers, by themselves, can only decide on matters under the delegated authority of policies that are law, in limited fields of their application. Example: FDI in multi-brand retail has been allowed recently by them through the Foreign Investment Promotion Board, under authority delegated by company law and of the law governing the RBI.

The arguments like whether or not a particular natural resource is to be auctioned is not for the CAG to decide. Is it anybody’s case that CAG should decide policy? No. The right question would be to ask whether CAG can evaluate the consequences of Government policy. Yes, he can and should, as he has been doing since the PAC of the 2nd Lok Sabha requested him to undertake performance audit, and especially when the systems-based audit of revenues began in the 1960s which, on the recommendations of the PAC, helped Ministry of Finance to move amendments to Acts, rules and procedures. Let’s not forget if the CAG doesn’t do this job, there will be no body – constitutional or otherwise - evaluating the impact and consequences of Government policies and decisions. Maybe the future Lokpal would.

At a time when the Prime Minister himself characterizes as difficult financial times with our fiscal deficit threatening to downgrade our economy – for a minister to say “Governments are not in the business of maximising revenues. Instead of filling its own pockets, it is obliged, in a welfare state, to fill the pockets of the aamadmi” – especially when actions of the welfare state that are being questioned are making Crores of Rupees of profits for a few Crony capitalists and friends of the Government. As Raghuram Rajan, the new Chief Economic Advisor to the Government, has himself written – almost all of the billionaires created in India have created their wealth ‘because of their proximity to politics and politicians’. At the same time, asking the aamadmi to bear the burden of this weakening financial situation of the country, defies any logic – political or otherwise.

These scams of recent times must make for change in the way we make our Governments function - despite all the efforts to sweep it under the carpet. If it wasn’t for the CAG and the Supreme Court, these cases would never have seen the light of the day and would have disappeared from the public discourse and memory, as another senior minister in the Government has predicted. To constitutional bodies like the CAG and Judiciary, I remind them of the words of the great Dr. Radhakrishnan “Do not shrink from the truth for fear of offending men in high places.”