Relations of CAG and PAC
The CAG (Comptroller and Auditor General of India) is a constitutional body created under Article 148 of the Constitution while the Public Accounts Committee (PAC) is a standing committee of Parliament created under Government of India Act, 1919 coming into existence in 1921. The primary function of PAC is to examine the annual audit reports of CAG and submit its findings to the Parliament.
The CAG submits three audit reports – audit report on appropriation accounts, audit report on finance accounts, and audit report on public sector undertakings – to the President who causes them to be laid in the Lok Sabha. The PAC then examines these reports, that is to say, it examines the financial transactions of government ministries, departments and public sector enterprises on the basis of these reports. It does so not only from the legal point of view to discover technical irregularities but also from the point of view of economy, propriety, and prudence to discover instances of corruption, waste, loss, and inefficiency. The CAG assists the PAC in the examination of these reports. Thus, there is a close working relationship between CAG and PAC to secure the accountability of executive in the field of financial administration.
It would not be far from truth to say that until recently, the CAG was treated more or less as an appendage of the PAC. But the tenure of previous incumbent, Vinod Rai, witnessed the office of CAG asserting its authority above that of being a mere appendage and repeatedly bringing the government to book in the sphere of financial administration. The CAG brought out scathing audit reports on 2G spectrum allocation, commonwealth games and coal block allocation, and also targeted the politician-corporate nexus through these reports. He made the audit reports more accessible and understandable to the common man by publishing Noddy Books which are lucidly written, miniaturized versions of the massive audit reports on scams that were exposed by his office. He also appointed a media officer in 2010 to increase the interaction of CAG with media.
In fact, far from being an appendage to the Public Accounts Committee, the office of CAG has now become a household name which commands huge respect from the common public and is truly recognized by the public as one of the most important constitutional functionary, as also proclaimed by Dr. Babasaheb Ambedkar in the Constituent Assembly.
