New Delhi, May 21: Why outgoing Comptroller and Auditor General Vinod Rai favours bringing all private-public partnerships (PPPs), Panchayti Raj Institutions and societies getting government funds within the ambit of the CAG?
The man, whose reports on 2G Spectrum and coal blocks have shaken the government, is retiring tomorrrow after five and half years in office.
His demand to widen the scope of CAG powers has a sound logic.
In a trillion dollar economy of India, 60 percent of government spending does not come under the scrutiny of the CAG. That is huge amount and not accounted.
Add to this the current fetish of governments for the PPP projects. The PPP model has become a favourite mode of executing big infrastructure projects worth millions of rupees and these projects are not audited by the CAG. This opens doors for corruption in the form of project cost over-runs and tardy execution of the project. Only special audits are done where the government makes a request, and this is rarely the case.
In infrastructure projects, private companies have a tendency to increase user charges, however, the reason or reasoning behind such increase are never disclosed. The increase is a stiff burden on consumers like airport user charges or highway toll.
"All PPPs, PRIs and ULBs (Urban Local Bodies), societies, etc should be brought under the CAG," Rai said in an interview to a news agency.
Asked whether NGOs taking government aid should be brought under the purview of CAG, he said, "That's right, the special societies."
Citing the example of National Rural Health Mission executed by societies getting hundred per cent funds from government, Rai said, the government had requested the CAG to do the audit and they did it. "But probably, it would be more advisable to bring it within the automatic legal mandate of the CAG."
Rai sought amendments to the CAG Act of 1971 to keep pace with the changes in governance. "The Act needs to be updated. For example, after the 74th and 75th amendments, came PRIs and ULBs institutions that have come into government's channels for delivery of schemes. Similarly, PPP models have been achieved. These all need to be covered under the CAG Act", he said.
In the interview, the CAG strongly defended the reports including on 2G spectrum allocation during his term that had triggered a number of controversies and bringing in the concept of presumptive loss in audit.
Rai also backed demands for a collegium type of selection for CAG though he was not very sure about the effectiveness of a multi-member body.
Targeted by those in government as exceeding the mandate by going into policy formulations, he makes it clear that by nature audit has an adversarial function and it cannot praise government policies.
Rai strongly defended the concept of presumptive loss in arriving at under-recoveries of the government in spectrum allocation and other matters. Rai also said that the concept of presumptive loss is used worldwide.
"The external audits we perform is post the event. So we are guided by hindsight only. That is usually the allegation and that is exactly how external audit functions", he said.
Rai said the audit found that there was some loss to the national exchequer in the policy of spectrum auction that was followed in 2008.
"Now the issue is the quantum of loss. Now in the quantum of loss we have given four figures. Nobody can say for definite what is the quantum of loss. "I pointed out that the quantum of loss, the figures that we had...the CBI is giving Rs 35,000 crore. We have given from Rs 66,000 crore to Rs 1.76 lakh crore. In fact one of our reports also has a figure of Rs 4.19 lakh crore."
"So what I said was whether it was anybody in the political executive or in the bureaucracy, we feel sorry if they feel that there has been no loss. We feel sorry for the country if anyone of these people feel that there is no loss to the exchequer."
Asked if ever the thought of quitting crossed his mind in the face of severe attacks over his reports, especially on 2G and coal allocations scams, he said, "never, never."
With PTI inputs