CAG vs MoD: it gets seamier and seamier

This time, the attack against the CAG is far more virulent, with rebuttals of CAG reports coming once every few days from the Raksha Mantralaya. The CAG has now decided to counter the attack with a deputy CAG taking the unprecedented step of writing directly to Defence Secretary Yogendra Narain complaining about the media onslaught.

The letter is understood to have pointed out how, instead of replying to specific queries sent by CAG before reports were published, the MoD instead chose to remain silent and control the damage by later releasing the information to the media. CAG sources say there is no reply yet from the defence secretary, and that another letter would soon shortly be sent by them to the Raksha Mantralaya.

The CAG verses MoD debate has raised an important question: how competent is the august body of auditors to find fault with government transactions, ranging, say, from Igla missiles imported by the Navy to misuse of funds for the Primary Education programme?

Several CAG officials whom The Indian Express spoke to say the question of accuracy of their recent findings will be answered at meetings of the PAC, which will shortly take up the controversial CAG report on Kargil deals and import of coffins from USA.

In a rare interview, the newly-appointed CAG, Vijendra N Kaul, pointed out that before they published any audit para, the concerned department or ministry gets three occasions to clarify its stand. 8216;8216;An audit para is finalised only when the auditor takes a consistent stand on a particular issue to which the concerned department or ministry has not been able to give a satisfactory reply. After this to go into the question of CAG8217;s experience and expertise looks like someone is running for cover,8217;8217; he told The Indian Express.

Kaul counters the issue of specialisation with the comment, 8216;8216;Admittedly we do not employ rocket scientists or micro-biologists. We are all auditors and this is the way national auditing bodies function in most developed countries.8217;8217; The CAG now employs 65,000 people in 105 8216;8216;field formations8217;8217;.

In the order of precedence, the CAG enjoys a rank at par with the Cabinet Secretary and Attorney General. As Kaul points out, auditors who handle subjects like defence, railways and commercial audits work on the specialised areas from the time of joining till retirement. On an average, CAG publishes 80 reports every year, including some special audits.

Broadly speaking the audits can be divided into three categories: a certification of accounts; a look at transaction deals and an analysis of value for money spent by the union and state governments.

Over the past few years, the CAG has been hiring services of private consultants and surveyors. This was done, for example, for CAG8217;s special audit of food grains when they hired a private company of surveyors. And as Deputy CAG S. Lakshminarayanan points out, the help of senior retired defence personnel is now taken before finalising major defence reports.

For the report on the army8217;s inventory, for instance, CAG employed Lt Gen D V Kalra Retd and for the Naval inventory, it took the guidance of Vice Admiral A Britto Retd. As consultants, these officials work with CAG auditors for a few months and their inputs, CAG sources say, are valuable while tackling questions on the need to purchase or over-pricing of defence equipment.

CAG officials claim that while they do not want to join issue with the MoD on the spate of 8216;8216;rejoinders8217;8217;, they were clear all the facts and figures reproduced in the audit paras were compiled from ministry records. While audit paras on minor defence purchases were picked on a random sample basis, they examined files of all major purchase deals. There are presently around 100 CAG employees working on audits in South Block since that prevented secret purchase files being taken out of the ministry. Once the final audit paras are ready, the ministry is given around three months to file reply, only after which the report is finalised.

Lakshminarayanan says as the defence unit8217;s head, he doesn8217;t find any dramatic changes in the ministry8217;s purchase pattern over the years. 8216;8216;We prepare our audits on the basis of parameters and scales set by the ministry itself but find that similar lapses and infringements are taking place every year. Our recent reports reflect the delays in supply and over-stocking of equipment.8217;8217;

According to Vijay Kumar, Deputy CAG handling commercial audits, they also find the same errors being repeated by various government departments and the 364 PSUs they audited. 8216;8216;The CAG can8217;t measure the impact of its audits. What8217;s evident is that corrective measures are not taken in time. The accountability framework is missing in the country.8217;8217;