Shedding the shackles of foreign domination, India awoke to “life and freedom” on August 15, 1947. On January 26, 1950, the Constitution of India came into effect. Thus ensued our democratic journey, emphasising the principles of individual rights, equality, accessibility, rule of law, separation of powers, universal suffrage and public participation. Today, India stands as the world’s largest democracy, with a vibrant political landscape, a diverse society, and ongoing efforts to overcome various socio-economic challenges.
The Comptroller and Auditor General of India (CAG) plays a crucial role in this democratic framework by ensuring transparency, accountability, and financial integrity in government’s functioning. CAG helps maintain the separation of powers between legislature and executive by ensuring that the government’s financial activities align with legislative intentions. Through its audit findings and recommendations, the CAG promotes good governance practices and helps governments streamline their operations, reduce inefficiencies and adhere to financial discipline. As India’s democracy matures, the CAG’s role becomes even more vital in promoting good governance and safeguarding the people’s interests.
Democracy, was defined by Abraham Lincoln during the 1863 Gettysburg address, as “government of the people, by the people and for the people”. These words have, in recent times, described the United Nations 2030 Agenda for Sustainable Development, a blueprint comprising 17 goals for mankind and the planet’s wellbeing. Auditing the achievements of sustainable development goals is integrated in all our audit work. In fact, internationally, as a member of the UN Board of Auditors, CAG of India took up the audit of SDGs as a cross-cutting theme in the UN Audit in 2017.
By placing the Indian citizen at the centre for implementation of government programmes and as ultimate beneficiaries, there is an onerous expectation of the CAG to assess the preparedness and planning, as well as to monitor and recommend corrective actions for realisation of these economic, social and environmental aspirations. To effectively discharge this responsibility, it is important for audit to actively work in tandem with citizens, appreciating their concerns and feedback.
Citizen engagement guides audit in identifying high-risk areas of possible mismanagement and inefficiencies in governance, thereby improving focus and effectiveness. In India’s federal, multiparty democracy with both Union and state governments responsible for implementation of numerous schemes, projects and programmes, enhancing engagement with stakeholders is imperative for audit. This need is further heightened with the paradigm shift in the government delivery system, using Direct Benefit Transfers for flow of funds, and ensuring accurate targeting of beneficiaries.
Leveraging technology and digital solutions make audit’s citizen engagement more effective and scalable. With increasing mobile density, smartphone applications may be used to solicit society’s suggestions. Digital reports with interactive data visualisation tools lead to better understanding and appreciation of our audit products. Deployment of 5G connectivity will transform governance. We need to harness the potential of these new technologies in our stakeholders and citizen engagement as well as overall audit strategies to make processes more efficient and effective.
Our framework for engagement with citizens at various stages of audit encompasses an Audit Advisory Board, including external domain experts, stakeholders’ meetings workshops, beneficiary surveys during audits, using the results of social audit to aid CAG’s audit, and of course, laying of audit reports in Parliament, state legislature and also uploading them on our website for information of citizens.
Social audit is an interesting tool for facilitating citizen oversight. The Parliament passed the National Rural Employment Guarantee Act, whereby Gram Sabhas were required to conduct regular social audits of all projects taken up under the scheme within the Gram Panchayat. The Ministry of Rural Development in consultation with the C&AG office notified the Mahatma Gandhi National Rural Employment Audit of Scheme Rules in 2011. The rules envisaged social audit units in each state as well as the audit process for social audit and follow-up action. The ambit of social audit has been significantly enlarged since.
The 73rd and 74th Constitutional amendments marked a quantum leap in India’s democratic set up, as they created tiers of self-governance below the level of states. The structured origins of local governance in India can be traced to the “Janpadi and Pancha” system. Fast forwarding to independent India, the 1958 Balwant Rai Mehta Committee recommendations laid the foundations for a three-tier structure for rural self-governance, culminating in the 73rd and 74th amendments.
Empowering PRIs and urban local bodies and municipalities, envisions people’s participation in the process of planning, decision-making, implementation and delivery of a set of functions to be devolved to local governments by state legislatures. These local bodies are further empowered with the Finance Commission’s direct flow of funds. Also, these local bodies not only implement the schemes of both Union government and state governments, but ensure transparency and visibility as grassroot participation is envisaged.
The primary audit of the accounts of local governments and issue of audit certificates is done by local fund auditors designated by state governments. Hand holding by the CAG to improve local governance, and, hence, strengthen democracy, includes capacity building of state local fund auditors in Audit Planning and Audit Methodologies, through Technical Guidance and Support (TGS) as recommended by the 11th Finance Commission. Over the years, CAG has issued numerous manuals/ guidance, forming the bedrock of auditing and accounting by local governments. Annual Technical Inspection Reports (ATIR) are issued by CAG’s state audit offices entrusted with TGS. The primary focus of CAG’s local government audit is an assessment of how well the delivery of the services pertaining to devolved functions have reached the last mile or the grassroots, through the efforts of the local governments.
Responding to the dearth of competent accountants willing to work in local governments, especially in the lower tiers located in remote places, CAG in collaboration with the Institute of Chartered Accountants of India has envisaged a set of online courses to create a pool of accountants intended to be available at local level, competent to prepare urban and rural local government accounts. Registration for these courses will commence on November 16, 2023, on Audit Diwas. Educational qualifications for eligibility have been prescribed at such level that these certified/ qualified accountants should be available for service on periodic contracts at reasonable cost to local bodies.
Carrying forward this recognition of local self-governance as the true manifestation of democracy and the CAG’s responsibility for ensuring accountability, an international centre for local governance has been envisaged. This will serve as a centre of excellence for capacity building of local government auditors, both nationally and internationally; and will serve as a knowledge centre and think-tank, addressing capacity building for stakeholders at grass-roots level across the nation.
To conclude, democracy’s vitality lies in its unique synergy of accountability and citizen engagement. As we navigate the complex landscape of modern governance, it becomes evident that for democracy to thrive, accountability mechanisms must be robust, and citizen engagement must be active and informed. While the CAG catalyses good governance, transparency and accountability, the responsibility to nurture and protect democratic principles falls not only on our institutions but on every citizen. It is then that the interplay of these elements fosters a mature democracy of the people, by the people, for the people.
The writer is Comptroller and Auditor General of India
By placing the Indian citizen at the centre-stage for implementation of government programmes and as ultimate beneficiaries, there is an onerous expectation of the CAG to assess the preparedness and planning, as well as to monitor and recommend corrective actions for realisation of these economic, social and environmental aspirations. (Illustration by C R Sasikumar) 
Share
