UPSC IAS exam preparation - Ethics and Values - Lecture 18

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Probity in governance - Part 2

6.0 Improving Governance in India

It is commonly recognized that corruption, which has become a universal phenomenon, unless kept in check, can undermine the finest of systems. It eats into the very vitals of the civic society and directly vitiates the relationship between the citizen and the state, which in modern times must conform to the status of a welfare state. However, the common man feels that there is lack of political accountability - its criminalisation and 'compulsions' of coalition politics, and systemic weaknesses in corruption/grievance redressal machinery are the most important reasons for sustaining corruption in the country. Further, it is perceived more as a result of monstrous greed allowed sanction by corrupt politicians and a weak, apathetic and unaccountable government machinery - all these elements reinforcing each other. The existing anti-corruption institutions are also not very effective as they are under the control of the politicians, lacking real teeth and powers, and not having the strength of officers with impeccable integrity. Besides, these institutions face problems with regard to paucity of staff and non-filling up of the vacancies, etc.

6.1 Service delivery excellence

Improving Governance is a part of a development process. It is argued that corruption can be curbed by systematic changes in governance through introducing participation, transparency, accountability and probity in administration. The right to good governance is also considered as an essential part of the citizen's rights that one can expect from the government. Accordingly, a number of initiatives have been taken by the government to incorporate citizen's concerns as inputs in the formulation of policy as well as in the quality and reliability of services. These can be brought through various tools, including the Citizens' Charters, Right to Information, e-Governance, Report Cards and Social Audits. Besides, each department have now developed its public grievance redress mechanism by appointing a senior officer as Director of Grievances' with the powers to call for files/papers relating to grievance. The public can approach him/her for the redress of its grievances. He/she is supposed to be available on every Wednesday between 1000 and 1300 hours.

6.2 The Right to Information Act 2005

Another important measure which assists probity in governance is the RTI Act enacted in 2005. This act empowers the common man to know his entitlement to avail a particular public service, and redress the grievance, if any. It also includes the 'Right to be Heard and Consumer Education', i.e., educating the consumer about his rights. It is based on the rationale of "participatory, transparent and accountable governance". Under the Right to Information Act, public servants can also be questioned on their conduct and, thus, made them accountable.

6.3 Electronic governance or e-Governance

Electronic governance is to ensure better transparency and services to the public. It disseminates information through an efficient, speedy and transparent process to the public and other agencies, and performs government administration activities. e-Governance can effectively be introduced through -

Computerization of all the public dealing Departments, including the Police, Judiciary, transportation, and registration of properties.
Introduction of e-Procurement (preferably on the lines of KONEPS) in all public procurements and contracts
Introduction of 'Touch Screen System' showing pictures to avail particular service.
Replication of 'Lok Vani' software for redress of public grievances.
Strengthening the infrastructure of e-governance and enhancing the awareness about e-governance.

Thus, e-Governance is considered an effective tool of improving governance.

6.4 The Lokpal bill

Following are some important features of the Lokpal and Lokayuktas Bill, 2011, passed by Parliament.

Lokpal at the Centre and Lokayukta at the level of the states.
Lokpal will consist of a chairperson and a maximum of eight members, of which 50 per cent shall be judicial members.
50 per cent of members of Lokpal shall be from SC/ST/OBCs, minorities and women.

The selection of chairperson and members of Lokpal shall be through a selection committee consisting of Prime Minister, Speaker of Lok Sabha, Leader of Opposition in the Lok Sabha, Chief Justice of India or a sitting Supreme Court judge nominated by CJI, eminent jurist to be nominated by the President of India on the basis of recommendations of the first four members of the selection committee.

Prime Minister has been brought under the purview of the Lokpal.
Lokpal's jurisdiction will cover all categories of public servants.
All entities receiving donations from foreign source in the context of the Foreign Contribution Regulation Act (FCRA) in excess of Rs 10 lakh per year are brought under the jurisdiction of Lokpal.
Provides adequate protection for honest and upright public servants.
Lokpal will have power of superintendence and direction over any investigation agency including CBI for cases referred to them by Lokpal.
A high powered committee chaired by the Prime Minister will recommend selection of the Director, CBI.
Directorate of Prosecution headed by a Director of Prosecution under the overall control of Director.
The appointment of the Director of Prosecution, CBI on the recommendation of the Central Vigilance Commission.
Transfer of officers of CBI investigating cases referred by Lokpal with the approval of Lokpal.
The bill also incorporates provisions for attachment and confiscation of property acquired by corrupt means, even while prosecution is pending.
The bill lays down clear time lines for preliminary enquiry and investigation and trial and towards this end, the bill provides for setting up of special courts.
A mandate for setting up of the institution of Lokayukta through enactment of a law by the State Legislature within a period of 365 days from the date of commencement of the Act.

7.0 Role of the Comproller and auditor general (cag)

The current Constitutional responsibility of the CAG is to provide Parliament and, through it, to the citizens, independent assurance on the way in which the government has used and accounted for funds voted by Parliament and on the examination of the tax system. The CAG's mission statement reads: "Mandated by the Constitution of India, we promote accountability, transparency, and good governance through high quality auditing and accounting, and provide independent assurance to our stakeholders, the Legislature, the Executive and the Public, that public funds are being used efficiently and for the intended purposes."

Public financial management must be regarded as an integrated system, as weakness in one part can have an adverse impact on the functioning of the other aspects. Various reports of the CAG of India have played an important role in the ongoing debates on weak governance and corruption in the country. CAG's reports on the 2G spectrum allocation; fertilizer subsidies; schemes under Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), and others, have lent much needed substance, and quantitative basis to these debates.

7.1 Steps to make the CAG more effective

To enable the CAG to pursue its role in India's PFM with greater effectiveness, there are several measures which merit consideration.

CAG is an external audit institution which follows international benchmarks. It can play its role better if internal audit functions of the covered government organisations are strengthened. This is the responsibility of the executive branch at all levels of government. If the internal auditing function is strengthened, considerable efficiencies can potentially be attained at a much earlier date in the policy cycle. This will also help reduce over reliance on the CAG. The executive branch should be required to be transparent and accountable about the measures which are designed to strengthen internal auditing. Establishing internal controls and ensuring proper organisation in autonomous government agencies such as universities, port trusts, and organising committees of events such as the 19th Commonwealth Games could well reduce the auditing burden of the CAG, strengthening public finances.

The current CAG Act enacted in 1971 requires modifications. Currently, only the government agencies, and bodies substantially financed from the Consolidated Fund are included within the purview of the CAG. However, changing the focus of the CAG Act from funding to governance, needs to be considered. The current CAG Act creates ambiguity concerning the auditing requirements of certain urban and local bodies, Development Authorities, Special Purpose Vehicles (SPVs), and those involving Public Private Partnerships (PPPs). As India becomes increasingly urbanised, and as the role of Development Authorities and PPPs among others, increases, their inclusion in the CAG Act to ensure that significant proportion of the expenditure does not escape auditing requirements merits serious debate. There is provision under section 619(4) of the Companies Act' for private auditing firms to undertake the audit function of certain public sector organisations, such as the PSUs. However, these audits are supplemented by a CAG audit; and the performance audit is undertaken by the CAG. Whether the key infrastructure organisations such as power and water utilities, even if privately owned, be subject to the above section of the Companies' Act is an issue requiring further reflection and debate. The CAG sent specific proposals for amendments to the Act in 2010. These were in areas concerning the speed at which government departments respond to audit requests, mandatory disclosure of final audit reports, and clarifications on the CAG's powers to audit new forms of government activity and currently uncovered organisations. These will include PPPs, urban development bodies, and SPVs whose activities involve government expenditure or may give rise to contingent fiscal liabilities.
The audits undertaken by the CAG are classified as either regulatory or performance audits. However, while assessing 'performance' or VFM and in particular, when judging 'effectiveness' of a government programme, the CAG will have to be mindful of the thin line of difference between passing an opinion on policy implementation and on policy making.
The arrangements for the CAG to play an advisory role when a large programme or a scheme is being designed or implemented, also merit debate and consideration. As an example, the ambitious and expensive Aadhaar programme being implemented by the Unique Identification Authority of India (http://www.uidai.gov.in) led by its Chairman Nandan Nilekani, can lend itself to CAG's advisory role. The danger of such an advisory role, however, is that the concerned public sector department might hold the CAG responsible for decision making. Therefore, a possible ex-ante advisory role of the CAG's office should include suggesting measurable indicators or targets to judge a programme's success or failure, hence making it more 'auditable' and reducing disputes between the executive, ministers, and the CAG's office that may arise at the time of audit.
The CAG's work is often constrained by poor quality of data, and limited data management and data mining capabilities of the government organisations. Data limitations are particularly crucial in the case of VFM audits because if data is missing on inputs and cost of procurement, or if data is not provided in a timely manner, auditors will be unable to express an opinion on efficiency and effectiveness of the policies and programmes. Hence, it is of utmost importance that the CAG auditors exercise adequate due diligence in accepting the accuracy, integrity, and completeness of such data before using them for analysis. This needs to be clearly brought out in CAG's report at the beginning.
The role of the Public Accounts Committee (PAC) and the Committee on Public Sector Undertakings (PSUs) which are representatives of the legislature and question the executive based on audit reports submitted to them by CAG, also need to be strengthened and made more active with particular emphasis on ensuring accountability. That no one has been held responsible for the current state of affairs at Air India, and at the oil PSUs strongly suggests the need for this, with emphasis on answerability. This is crucial because in the Westminster audit model adopted in India, the CAG cannot impose its recommendations on the executive. In other words, the ultimate impact of the CAG's work depends on the keenness of the legislature to participate and engage with the findings and recommendations of audit reports, fix responsibility and take punitive action. Indifference to such recommendations of the PAC should be treated as 'legislative contempt', much the same as 'judicial contempt'. Time has probably come for such a reform.
The CAG has an important role at the state level as well. In 1976, the CAG was relieved of the responsibility of keeping the accounts of the union government but not of the state governments. This implies that the accounts of the states continue to be compiled by the State Accountants General (SAG) under the CAG. In 2009-10, states accounted for more than half the expenditure of the central and state governments combined.

This suggests an urgent need to revamp the role of PACs of the state legislatures. Their deliberations should be made public, and perhaps be considered for live telecast to assist in wider dissemination and public accountability. It might also be suggested that the SAGs be given legal status to strengthen their position and reduce the legal burden of the CAG. The states can more over benefit from CAG's expertise by involving them in an advisory role at earlier stages of policy and programme.

8.0 2nd ARC AND ITS RECOMMENDATIONS

The 2nd Administrative Reforms Commission was constituted on 5th August, 2005 with the mandate to suggest measures to achieve a proactive, responsive, accountable , sustainable and efficient administration for the country at all levels of the government. The domain of the Commission's suggestions was very wide and included:

(i) Organisational structure of the Government of India (ii) Ethics in governance (iii) Refurbishing of Personnel Administration (iv) Strengthening of Financial Management Systems (v) Steps to ensure effective administration at the State level (vi) Steps to ensure effective District Administration (vii) Local Self-Government/Panchayati Raj Institutions (viii) Social Capital, Trust and Participative public service delivery (ix) Citizen-centric administration (x) Promoting e-governance (xi) Issues of Federal Polity (xii) Crisis Management (xiii) Public Order.

The Commission has presented 15 reports to the Government so far. The 4th report of this Commission title Ethics in Governance made some crucial recommendations regarding regulating the conduct of civil servants. The crucial recommendations were:

The issue of disqualification of members on the grounds of defection should be decided by the President/Governor on the advice of the Election Commission
The Constitution should be amended to ensure that if one or more parties in a coalition with a common programme mandated by the electorate either explicitly before the elections or implicitly while forming the government, realign midstream with one or more parties outside the coalition, then Members of that party or parties shall have to seek a fresh mandate from the electorate.
Public Service Values' towards which all public servants should aspire, should be defined and made applicable to all tiers of Government and parastatal organizations. Any transgression of these values should be treated as misconduct, inviting punishment.
Conflict of interest should be comprehensively covered in the Code of Ethics and in the Code of Conduct for officers. Also, serving officials should not be nominated on the Boards of Public undertakings. This will, however,not apply to non-profit public institutions and advisory bodies.
A comprehensive and enforceable Code of Conduct should be prescribed for all professions, with statutory backing
Prior sanction should not be necessary for prosecuting a public servant who has been trapped red-handed or in cases of possessing assets disproportionate to the known sources of income.
The Prevention of Corruption Act should be amended to ensure that sanctioning authorities are not summoned and instead the documents can be obtained and produced before the courts by the appropriate authority.
The Presiding Officer of a House of Legislature should be designated as the sanctioning authority for MPs and MLAs respectively.
The requirement of prior sanction for prosecution now applicable to serving public servants should also apply to retired public servants for acts performed while in service.
All cases where the Government of India is empowered to grant sanction for prosecution, this power should be delegated to an Empowered Committee comprising the Central Vigilance Commissioner and the Departmental Secretary to Government. In case of a difference of opinion between the two, the matter could be resolved by placing it before the full Central Vigilance Commission. In case, sanction is required against a Secretary to Government, then the Empowered Committee would comprise the Cabinet Secretary and the Central Vigilance Commissioner.
Similar arrangements may also be made at the State level. In all cases the order granting sanction for prosecution or otherwise shall be issued within two months. In case of refusal, the reasons for refusal should be placed before the respective legislature annually.
In addition to the penalty in criminal cases, the law should provide that public servants who cause loss to the state or citizens by their corrupt acts should be made liable to make good the loss caused and, in addition, be liable for damages. This could be done by inserting a chapter in the Prevention of Corruption Act.
All government offices having public interface should undertake a review of their activities and list out those which involve use of discretion. In all such activities, attempt should be made to eliminate discretion. Where it is not possible to do so, well-defined regulations should attempt to 'bound' the discretion. Ministries and Departments should be asked to coordinate this task in their organizations/offices and complete it within one year.
Decision-making on important matters should be assigned to a committee rather than individuals. Care has to be exercised, however, that this practice is not resorted to when prompt decisions are required.
State Governments should take steps on similar lines, especially in local bodies and authorities, which have maximum 'public contact'.

Economic prosperity for Indians is not an option, it is a necessity. Economic empowerment and thereby emerging a superpower can be possible if growth is founded on good governance. Such growth is sustainable only if it is premised on an ethical code of governance. When the story of India is written, it should be written that governance was the solution and not the problem wherein the State was the facilitator and not the predator. These edicts in our governance structure have to be an essential ingredient as too much is at stake and for too many people.