October 6: The scams involving public money which have come to light recently show that the machinery for monitoring government spending has slipped into deep disarray.The fodder scam in Bihar involves all of Rs 950 crore. The bogus purchases of Ayurvedic medicines in Uttar Pradesh have resulted in the siphoning off of Rs 65 crore. Both these scandalous operations took place over several years and could not have been pulled off if the auditing of such expenditure had been thorough.Interestingly, both frauds were uncovered and received public attention because of prodding by the high courts in Uttar Pradesh and Bihar. If it weren't for this spotlight on them, these scams would have gone unreported as, most certainly, several others have.This is because they are but the surface symptoms of a chronic affliction which has resulted in the collapse of basic financial control and thrown procedures for auditing into wild disorder. The Constitutional mechanism for legislative monitoring of government finances has broken down. What is even more worrying is that nothing is being done to strengthen the mechanism and bring it to a state of alert. The Bihar fodder scam illustrates the point. Each state accountant-general publishes an annual review of the working of the government treasuries. The Bihar review was so badly in arrears that the accountant-general had to bring out a single review in August 1996, covering five years up to 1994-95. And this after the whole world had known for years that something was seriously wrong in the state of Bihar! The inspection of treasuries by the Comptroller and Auditor General of India lags behind in most states, particularly the bigger ones like Uttar Pradesh, Madhya Pradesh, Rajasthan and Orissa. The state Governments are undoubtedly the main culprits. But the CAG, which has been given independence and wide powers by the Constitution to enforce accountability in the Central and State governments cannot shirk its responsibility. The very preparation of the annual review of the Bhiar treasury, for instance is behind by five years. The situation is no better in Uttar Pradesh, where the Ayurveda scam has revealed the fraud perpetrated for only one year. Neither the CAG nor the CBI has bothered to find out if the racket was going on for many years in the past and who benefited from it. ``Gross irregularities involving astronomical sums stare you in the face in the published accounts submitted by most states. But the audit reports are published long after the occurrence of irregularities and the reports are not discussed by the public accounts committees of the legislatures for years.No wonder, India has become a nation of scams,'' says a former CAG on condition of anonymity. The backlog in auditing of their accounts gives the state governments plenty of leeway for manipulation. In any case, most of them do not take cursory audit objections seriously and the public accounts committees of the concerned state legislatures have little time to monitor what the executive has done to overcome the CAG's belated audit objections.A study reveals that the time lag between the submission of the CAG reports and their review by the state public accounts committees ranges from five years to over a decade in almost all major states.The price tax-payers have to pay for such gross dereliction of their constitutional and statutory obligation by the CAG and state PACs can be gauged from the simple fact that the state governments together spend about Rs 200,000 crore annually. A more effective regulatory audit by the CAG and its mammoth machinery of experts would not only result in timely detection and prevention of fraudulent withdrawals and fictitious expenditure but also check reckless spending by the politicians running the states as their personal estates.
