O P I N I O N S

PERSPECTIVE

CAG: Fixing financial accountability
In the light of the controversy over the CAG report on the 2G Spectrum scam, Dharam Vir says that its reports are accurate, objective and constructive
THE arrest of former Union Telecommunications Minister A. Raja, his private secretary R.K. Chandolia and former Telecom Secretary Siddharth Behura has given a new twist to the 2G spectrum scandal. A clear exposition of India’s architecture of financial accountability of the executive to the legislature is necessary in the context of the debate on the Performance Audit Report of the Comptroller and Auditor General of India (CAG) on the Issue of Licences and Allocation of 2G Spectrum particularly with reference to the amount of presumptive loss which has been criticised as “utterly erroneous”.

OPED

Census: A gigantic exercise
Measuring our growth and planning for the future
by O.P. Sharma and Carl Haub
ON February 9, India will conduct its seventh census of population and housing since Independence. One of the largest statistical exercises in history of mankind, the census will count an Indian population of about 1.2 billion, living in six lakh villages and 7,750 towns.

On Record
‘Crux of food security lies in rainfed farming’
by Vibha Sharma
Founder of Gene Campaign Suman Sahai, recipient of the Padma Shri in the category of science and engineering, is an active voice on food security for the past many years. She is opposed to the UPA government’s Food Security Bill in the current form. Which is why, the announcement of the top government honour came as an "unexpected, but pleasant surprise" to her.

Profile
Khayyam: A Hindi film music prodigy
by Harihar Swarup
Mohammed Zahoor Khayyam Hashmi, recipient of this year’s Padma Bhushan award, evokes memories of soothing, tilting melodies of yesteryears, of the Golden Age of Movies in the late 1950s and 1960s. Since late 40s, the veteran composer has done films at his pace less than one film a year but oh, what songs he has given us!. This music prodigy has turned 84.

PERSPECTIVE

CAG: Fixing financial accountability
In the light of the controversy over the CAG report on the 2G Spectrum scam, Dharam Vir says that its reports are accurate, objective and constructive

THE arrest of former Union Telecommunications Minister A. Raja, his private secretary R.K. Chandolia and former Telecom Secretary Siddharth Behura has given a new twist to the 2G spectrum scandal.

A clear exposition of India’s architecture of financial accountability of the executive to the legislature is necessary in the context of the debate on the Performance Audit Report of the Comptroller and Auditor General of India (CAG) on the Issue of Licences and Allocation of 2G Spectrum particularly with reference to the amount of presumptive loss which has been criticised as “utterly erroneous”.

The financial supremacy of the legislature over the executive by way of requirement of mandatory ex ante legislative approval for raising of revenue and incurring of expenditure and post facto accountability for the use of public resources is one of the defining hallmarks of parliamentary democracy. Both these are prescribed in the Constitution of India.

The organisation of CAG which is currently celebrating the 150th year of its existence assists the legislature in securing the accountability of the executive to the legislature. Post-independence, the CAG is a constitutional authority (Articles 148-151 of the Constitution) on par with the members of the apex judiciary, with guaranteed terms and conditions of service and a fixed non-renewable tenure of office combined with estoppel on eligibility for any further appointment under the Government that ensure that he can function without fear or favour, without affection or ill will as enjoined by the oath of his office. Dr B.R. Ambedkar had described his position more onerous even that of the judiciary.

The duties and powers of the CAG have been prescribed by laws made by Parliament, i.e. the Comptroller and Auditor General’s (Duties, Powers and Conditions of Service) Act, 1971, that makes him responsible for the audit of the receipts, expenditure, assets and liabilities of the Union and the State Governments, the public sector undertakings, autonomous bodies and authorities and government-funded voluntary organisations subject to the fulfillment of the prescribed conditions.

The Act authorises him the unfettered right to inspect any office and to call for any information, documents and records that he may require for the performance of his duties.

The CAG’s Regulations on Audit and Accounts, 2007, framed under the Act and published in the Gazette of India for the guidance of government departments demystify the audit processes and procedures.

The self-defined mission of the CAG is to promote accountability, transparency and good governance and to provide assurance to the stakeholders that the public resources are being used efficiently and for the intended purposes.

Independence, objectivity, integrity, reliability, professional excellence, transparency and positive approach are the guiding core values of the CAG’s organisation that constitute the essential ethos of audit. Consistent with its mission and the core values, the CAG examines whether systems and procedures are in place that ensure effective control over public receipts, expenditure, assets and liabilities with sufficient safeguard against loss due to waste, mismanagement, errors, frauds and other irregularities; that promote probity and transparency in decision making; and that secure achievement of the intended outputs and outcomes.

The second aspect of the CAG’s examination is verification whether such systems and procedures are faithfully implemented, both in letter and in spirit. Embedded in this is an essential requirement of the examination of public transactions for compliance with the broad and general principles of financial propriety. This raises audit examination to an altogether higher level, to a scrutiny of government transactions for their propriety despite compliance with the prescribed systems and procedures.

The bar is further raised in performance audit which is an examination of the extent to which an entity, programme, scheme or activity operates economically, efficiently and effectively; that is with minimum use of resources, maximisation of output and achievement of the laid down objectives by way of outputs and outcomes.

The audit reports are prepared in a highly inter-active, participatory and transparent manner with full involvement of the executive at all levels including the Secretary to the Government. Before commencing detailed work of performance audit, the Principal Audit Officer, who leads the performance audit exercise, holds an entry conference with Government Secretary wherein the scope and coverage of audit, audit objectives and criteria, the proposed techniques of audit evidence collection, overall timeline and tentative time schedule are discussed.

Such close interaction with the executive is continued during inspection of the field offices and all information collected and audit comments developed are disclosed to and discussed with the executive authorities for their observations, comments and confirmation. The entire work is done in accordance with a carefully prepared audit plan.

An exit conference is also held with the Secretary when the draft audit report is ready. The Principal Audit Officer is required to give full consideration to the observations and comments of the Secretary during the exit conference while preparing the audit report.

The draft audit report is sent to the departmental Secretary by name (with a copy to the Secretary, Finance Ministry, also by name) for formal confirmation of facts and figures and for communicating the comments, explanations and observations of the government. Copies of all supporting evidence and documents are also provided to the government as a measure of transparency.

Where the government reply is not found acceptable, the same is incorporated in the audit report indicating the reasons for non-acceptance. The intention is that there should be no subsequent occasion to dispute the accuracy of the facts and figures in the audit report.

The CAG’s internal procedures prescribe meticulous multi-layered scrutiny of the audit report for delivery of a high quality output. According to the guiding principles of auditing standards observed by the CAG, the audit report should be complete, accurate, objective, convincing, clear, concise and constructive. The thumb rule is that each and every statement in the audit report should be backed by unimpeachable evidence; and each and every conclusion should flow from the statements so made.

Under Article 151 of the Constitution, the CAG’s audit reports are submitted to the President who causes them to be laid before both Houses of Parliament. The audit report becomes a public document thereafter.

The audit report automatically stands transmitted to Parliament’s Committee on Public Accounts (PAC) for follow up action. The committee is constituted under the Rules of Procedure and Conduct of Business in Lok Sabha framed by Parliament in terms of Article 118 of the Constitution. The directions issued by the Speaker of the Lok Sabha supplement the rules.

The institution of PAC has its parallel in the PAC in England introduced by Gladstone in 1861, which resolved the dilemma that had baffled Parliament for years “whether expenditure should be controlled by inexpert parliamentarians or expert non-parliamentarians.” In India, the PAC came into being with the advent of the reforms under the Government of India Act 1919. Originally presided over by the Finance Member of the Viceroy’s Executive Council and post-independence by a member of the ruling party, the PAC is now by convention chaired by a member of the Opposition.

The Constitution Review Commission had described the institution of PAC as the keystone of the arch of parliamentary control of public finances. The PAC can travel beyond what is included in the audit report; it can also take up matters on which there is no audit report. The PAC comprises of 22 members: Lok Sabha 15; Rajya Sabha seven; elected on the basis of proportionate representation and thus represent Parliament in miniature. The Chairman is appointed by the Lok Sabha Speaker.

The government departments are mandated to send suo motu action taken notes (ATNs) to the secretariat of the PAC on the audit reports after these are tabled in the legislature. The action taken note should inter alia state whether the facts and figures stated in the audit report are acceptable and if not, the reason why this was not pointed out at the stage of the draft report. A period of four months is prescribed for the submission of the suo motu action taken note.

The suo motu action note is vetted by the CAG’s organisation which has been authorised to categorise the ATNs as ‘Accepted’, ‘Partially accepted’ and ‘Not accepted’ for the information of the PAC with detailed briefs on “Not Accepted’ cases clearly indicating the reasons for non-acceptance as well as the points of difference.

The CAG’s organisation also supplies a list of important points when a case is taken up for detailed oral examination by the PAC.

The PAC enjoys the privileges of the House and has the power to summon departmental secretaries for oral evidence besides requisitioning government records for perusal and study. The CAG briefs the PAC and also renders assistance in the examination of witnesses. The CAG has been traditionally described as the friend, philosopher and guide of the PAC.

The PAC is also authorised to take evidence of experts on its own or on requests made. The proceedings of the PAC are not open to the press or the public; and while a verbatim record of the proceedings is kept, it is not in the public domain. This has often been justified on grounds of the need to ensure uninhibited expression of views by the government officers in their evidence before the PAC.

The directions issued by the Lok Sabha Speaker specifically prohibit a Minister being called before the PAC either to give evidence or for consultation. The PAC Chairman (and not the entire PAC) may, however, when considered necessary but after its deliberations are concluded, have an informal talk with a Minister, to apprise him of any matters of policy laid down by a Ministry with which the PAC does not fully agree; and any matters of secret and confidential nature which the PAC would not like to bring on record in its report. The PAC may reconsider its conclusions in the light of such talk but shall not otherwise pursue further any of the matters with the Minister.

The scope of the PAC interaction is thus extremely limited. Nevertheless, there has been one instance in the past when a Union Minister appeared before the PAC on his own request.

Recently in one case the Minister obtained an independent opinion on a paragraph in the CAG’s Audit Report on Procurement for Operation Vijay (Kargil) and forwarded to all members of Parliament including the members of the PAC. This was in the backdrop of the uproarious scenes witnessed in Parliament over the issues raised in the audit paragraph.

The PAC was agitated with some of the members describing it as a case of breach of privilege. The PAC adjourned for the day as a mark of protest.

Be that as it may, the aforesaid limitation of the PAC to summon the Minister for evidence flows from the underlying concept that it is essentially an instrument of accountability of the civil service which is supposedly exclusively responsible for policy implementation.

However, not merely is the dividing line between policy formulation and policy implementation rather thin, but also big-ticket transactions require approval of the Minister or even the Cabinet. The Secretary may also find himself in the awkward position of having to defend or explain a decision to which he may have been opposed.

The report of the PAC is unanimous and there shall be no minute of dissent. The report is presented to both Houses of Parliament. The government departments are required to inform the PAC of the action taken on its reports within six months. The PAC examines the government replies and may come up with further report, called Action Taken Reports if the action taken by the government is not considered satisfactory. The PAC may also table statements on action taken by the government, as prepared by the Ministry, on the recommendations contained in the Action Taken Report.

The effectiveness audit depends as an instrument of promoting good governance depends upon the follow up action taken on the CAG’s audit reports and the reports of the PAC. The recommendations of the PAC have tremendous persuasive value and have resulted in streamlining of government rules and procedures and even amendments being made to tax laws. About 60 per cent of the recommendations generally get accepted.

However, as observed by Mr N. D. Tewari, a former Chairman of the PAC, the recommendations of the PAC for fixing individual responsibility are generally not implemented faithfully with the bureaucracy tending to close ranks and defending even the most blatant acts of omission and commission. According to him, it should be made mandatory by an Act of Parliament or a general resolution of the House that whenever the PAC makes a recommendation for fixing individual responsibility, the matter should be forwarded to vigilance or independent agency of investigation to bring the guilty to book.

A Sub-Committee of the Conference of Chairmen of Public Accounts Committees, 1986, had suggested registration of audit paragraphs that prima facie establish loss of public funds as First Information Reports for investigation, with a statutory presumption in favour of the correctness of the audit paragraph. This has not been implemented so far.

The Second Administrative Reforms Commission has recommended an amendment to the Prevention of Corruption Act to provide for a special offence of “collusive bribery”, an offence being defined as collusive bribery if the outcome of the transaction leads to a loss to the state, public or public interest. If it is established that the interest of the state or public or public interest has suffered because of an act of the public servant, it shall be presumed that the public servant and the beneficiary of the decision have committed an act of collusive bribery. The recommendation has not been accepted by the government. “The cost … which the Assembly has had to incur during its three years’ existence is not too high when you take into consideration the factors going to constitute it. I understand that the expenses up to the end of November 22, 2010, come to Rs 6396729.”

This observation made by Dr Rajendra Prasad, President of the Constituent Assembly, on November 26, 1949, in his concluding remarks just before the Constituent Assembly proceeded to adopt the motion to pass the Constitution carried several messages. First, the amount of expenditure had been computed to the last rupee. Second, the expenditure had been computed almost real time. Third, there was an attempt to justify (perhaps even an apology for) the amount of expenditure and whether full value for money had been obtained for the taxpayers’ money.

Finally, this was a historic occasion. A newly independent India was getting ready to put its seal on the basic charter of its governance and polity, what one of the former members of the Constituent Assembly had described as the Nation’s self-wrought Charter of Liberty. And yet the President had found time to refer to the amount that had been spent in crafting the document.

Collectively, these messages betokened the abiding concern of the founding fathers for the economical, efficient and effective use of taxpayers’ money and nation’s resources and for public accountability. The founding fathers had set an example by suo motu holding themselves to account in the public eye. It’s time to recall all this in the current din of debate in the wake of the CAG’s audit report.n

The writer is a former Deputy Comptroller and Auditor-General of India

OPED

Census: A gigantic exercise
Measuring our growth and planning for the future
by O.P. Sharma and Carl Haub

ON February 9, India will conduct its seventh census of population and housing since Independence. One of the largest statistical exercises in history of mankind, the census will count an Indian population of about 1.2 billion, living in six lakh villages and 7,750 towns.

India is rapidly approaching the day when the population will surpass that of China to become the world’s largest. We project that that will most likely happen in 2027. The census of India is conducted under the proviso of the Census Act, 1948 and is a Central subject.

The census does much more, of course, than simply tally up a number for the total population, which is nonetheless a very interesting number. The census provides essential data on who we are, our ages, the condition of our housing, the extent to which our living standards have improved and much more information to measure our progress as a nation and to plan for the future.

Full cooperation from all of us will ensure a successful enterprise. Unlike other surveys, the basic information gathered by the census enumerators is absolutely confidential – not even accessible to courts of law.

The decennial population census is conducted in two phases. During the first phase house numbering and house listing is done. The second phase involves actual population count.

Last year, field operation for the first phase was completed for all the states and Union Territories. This “house listing” operation inventories all census houses and structures, along with landmarks and natural features, so that each census-taker (enumerator) can be assigned a clear, delimited area for which he is responsible.

Each enumerator in rural areas is assigned an area called an enumeration block (EB) with an expected 750 people while those in urban areas enumerate in EBs with an expected 500 population. The larger size for rural EB is simply because answers to economic questions and to questions on migration are usually shorter and simpler than in urban areas.

The second phase involving actual population count begins on February 9 and continues to February 28 except in snow-bound areas where this exercise has already been completed.

On the night of February 28– March 1, the houseless population – those living under bridges, on pavements, etc. – will be enumerated. The census reference date is 00.00 hours of March 1, the date to which the count is applied.

Since the enumerator visits and enumerates people in his block on different dates between February 9 and 28, it is possible that some deaths and births might have taken place after the enumeration of the household and February 28. The enumerator is required to update the records of enumeration as on 00.00 hours of March 1.

For this purpose, the enumerator makes a revisional round of his block between March 1 and 5 and update the filled-in schedules by deleting the details of those who died and add the particulars of those who were born.

No doubt, the census of India is the largest single administrative exercise in the world which can be accomplished only with the total support and cooperation of the people. The vast army of devoted, loyal and hard working enumerators and supervisors, who are paid small token honorarium to cover their out-of-pocket expenses, bear the brunt of the entire gigantic exercise.

The state governments and Union Territory administrations also fully cooperate in ensuring the successful conduct of the census.

Then, India produces the first census report in record time – normally before the end of March. No other country in the world makes available the preliminary population totals so fast. The figures, though officially pronounced preliminary, in reality, final figures released later differ only slightly. At the same time, population figures are also released for the states and Union Territories.

If projections hold true, Uttar Pradesh will reach 200 million, (if it were a country it would be fifth largest country in the world ahead of Brazil and behind Indonesia), the first time any state passed that lofty figure. Both Bihar and Maharashtra are likely to surpass 100 million.

A number of great significance is the sex ratio of the child population, ages 0-6. Under normal circumstances, this would be 950 girls to 1,000 boys since there are about 5 per cent more boys born than females worldwide.

In the 1991 Census, that figure was 945 – close to normal. But, in 2001, it had dropped to 927. If government programmes against the abortion of females have truly met with some success, we will hopefully see that number rise.

India, stand up and be counted!

O.P. Sharma is India Consultant, Population Reference Bureau, Washington-DC, stationed in New Delhi and Carl Haub is Senior Demographer in the same Bureau"

On Record
‘Crux of food security lies in rainfed farming’
by Vibha Sharma

Suman Sahai

Founder of Gene Campaign Suman Sahai, recipient of the Padma Shri in the category of science and engineering, is an active voice on food security for the past many years. She is opposed to the UPA government’s Food Security Bill in the current form. Which is why, the announcement of the top government honour came as an "unexpected, but pleasant surprise" to her.

She speaks to The Tribune on the Padma Shri and about the food security legislation.

A: It is an unexpected but a pleasant surprise. Gene Campaign has been critical of government policies but whenever we have done we have also tried to provide an alternative. Ours has not been a vicious, meaningless criticism. We disagreed only because we wanted a better situation for farmers and food security. It is a wonderful feeling to know that the government has the capacity to recognise constructive criticism. The award is in recognition of our contribution to agriculture and farmers’ and community rights.

A: The problem with the Bill is that it has skipped the first nine steps and jumped to the last one. A whole lot of people who have no idea about food security have taken over the agenda. Welfare is one part but if you do not ensure a proper atmosphere for farmers to grow more, how will you get that extra food for distribution?

Right now there is something drastically wrong with the farming sector. Half of the farming community wants to get out of it specifically because it is not remunerative. If farmers are not making enough money to be encouraged to stay in the business, it would be a ridiculously simple approach to come up with a binding legislation on food security.

How will you get that extra food from? There is no surplus grain in the international market. Food security equals food sovereignty. Otherwise you will always be vulnerable to external forces. You have to come up with a bigger vision and start from step number one, growing enough food. Solutions are not exactly rocket science. They are fairly obvious.

A: First, agriculture has to be made sustainable for the farmer. Then there has to be a well-defined water policy, including one groundwater extraction. There is also no need to give free water or electricity to farmers who are not looking for freebies. They are more than willing to pay for conveniences you provide if they are making money.

If the farmer does find farming remunerative he will give up the production. If you want to make the country food secure, bring the water to rainfed area. The crux of food security lies in rainfed agriculture.

I strongly recommend shifting subsidy in urea to sustainable agriculture in rainfed areas. Solutions are neither complex nor cost-intensive. They are very simple, practical solutions, something that should have been implemented yesterday. The food security legislation currently is more like propaganda: it does not reflect the genuine desire to solve food problem. It is not a sustainable legislation.

A: Move away from the current model of agriculture which has sucked out micronutrients of the soil without giving anything back in return. `A0As it is, the area is fairly arid and cultivating rice has just left a layer of concrete in places. Farmers should step back from this crazily intensive production system they have been following and improve the soil health.

Secondly, diversification does not mean growing kinnow. Rice and wheat have been taking away the same kind of nutrients. So, go back to oilseeds, pulses and other cereals. The soil has to be given an opportunity to recuperate. Pulses will put back some nutrients rice and wheat have been extracting. Also, reduce mechanisation.

Farmers must realise that while they are building the soil health their rates of profit will go down but agriculture in this region has to take rest and then start off differently.

Profile
Khayyam: A Hindi film music prodigy
by Harihar Swarup

Mohammed Zahoor Khayyam Hashmi

Mohammed Zahoor Khayyam Hashmi, recipient of this year’s Padma Bhushan award, evokes memories of soothing, tilting melodies of yesteryears, of the Golden Age of Movies in the late 1950s and 1960s. Since late 40s, the veteran composer has done films at his pace less than one film a year but oh, what songs he has given us!. This music prodigy has turned 84. Think of Footpath, Kabhi Kabhi, Umrao Jaan and Razia Sultan and Khayyam springs to one’s mind.

Khayyam has also been associated with mega serials such as Great Maratha, Dard and Jai Hanuman and many film albums. All his songs have the ability to evoke nostalgic memories in music lovers. Not surprisingly, Khayyam is a philosopher. He says he owes his success to God, his wife, singer Jagjit Kaur, a Sikh, and the blessings of his gurus Pandit Amarnath, Husnlal and Bhagatram.

Khayyam’s music, according to some critics, was unique and stylish. Some say it was ‘moody’. However, there is no denying of the fact that he composed music which found a permanent place in the heart of millions. It is perhaps because he composed music on his own terms and only for some movies that he composed music without any compromise.

Think of Shola Aur Shabnam, Razia Sultana and Umrao Jaan. Reports say that Khayyam was doing two films — Benares 1918: A Love Story and Yatra. He says that he chooses films for which he should compose and he has picked up these two films. Most of his fans think that the first film to bear Khayyam’s signature was the Dilip Kumar-Meena Kumari starrer, Footpath (1957). Very few know that Heer Ranjha (1948) was the maestro’s film because he was credited under the pseudonym “Sharmaji”. What made him do that? Because he felt his original name — Mohammed Zahoor Khayyam Hashmi — was too long. Later, he switched to more melodious ‘Khayyam’ with Footpath.

Khayyam was born as Sa’aadat Hussain in Rahom village of Nawanshahr district of undivided Punjab. As a boy he ran away to Delhi to learn music but was forced to return to complete his education. Khayyam then went to Lahore to learn music from famous Baba Chesti. He was never interested in studies and was always fascinated by Hindi cinema music. He was inclined to the music when he was very young.

Interestingly, he often escaped to the city for watching movies. Khayyam soon ran away to his uncle’s house in Delhi, in the hope of becoming an actor. His uncle enrolled him in a school, but when he saw his passion for films, he allowed him to learn music. In those days it was actually a step forward in realising his ambition. He got his training in music under Pandit Amar Nath.

Fate had something else in store for Khayyam. One day he had gone to meet G.A. Chesti, one of the foremost music directors from Pakistan. Young Khayyam, sung to him his composition. Impressed by the hidden talent in the young man, Chishti gave him an offer of joining him as an assistant. Khayyam assisted Chishti for six months and came to Ludhiana in 1943. He was only 18 then.

After a stint in the Army in World War II, Khayyam went to Bombay to fulfill his dream. He made his debut as Sharmaji of the Sharmaji-Varmaji composer duo with the movie Heer Raqnjha in 1948. He went solo after his co-composer Rahman Varma went to the newly created Pakistan post-Partition. One of his earliest breaks was in the film Biwi in which the song Akele Mein Wo Ghabrate To Honge sung by Mohammed Rafi. It was a huge hit.

He, however, gained greater recognition in the film Phir Subhah Hogi starring Raj Kapoor and Mala Sinha, in which songs written by Sahir Ludhanvi and sung by Mukesh and Asha Bhosle were set to tune by Khayyam. Notable among them were Woh Subha Kabhi To Aayogi, Assman Pe Hai Khauda Aur Zameen Pe Hum and Chin-o-Arab Humara. The film Shola Aur Shabnam established Khayy-am’s reputation as a great composer.

The Seventies saw Khayyam teaming up with Sahir once again to work in the Yash Chopra-directed Kabhi Kabhi. The songs were super hits and showed Khayyam’s versatility with super hits like Kabhi Kabhi Mere Dil Mein Khyal Ata Hai and Mein Pal Do Pal Ka Shayar Hun.

Khayyam is a prodigy of the Hindi film music. His house serves as a study in simplicity with relics of all religions and multi-religious ceremonies are part of his daily life. God, to him, is a single Power.