Sambhav-2025

Approach Briefly introduce the Public Accounts Committee (PAC). Discuss the significance of the PAC as a financial watchdog. Highlight the Limitations and Challenges. Suggest reforms to enhance its effectiveness. Conclude suitably.

Introduction

The Public Accounts Committee (PAC) is one of the most crucial parliamentary committees, acting as a financial watchdog to ensure that executive spending aligns with legislative intent. Established in 1921 under the Government of India Act, 1919, the PAC examines reports of the Comptroller and Auditor General (CAG) and ensures accountability in public expenditure.

Body

Significance of the PAC as a Financial Watchdog :

• Examining CAG Reports: The PAC scrutinizes whether public funds are spent for the intended purposes as approved by Parliament.
  • 2G Spectrum Scam (2010): The PAC, based on the CAG report, revealed a loss of ₹1.76 lakh crore due to irregularities in spectrum allocation.
• Preventing Financial Irregularities: It investigates cases of wasteful, unauthorized, and extravagant spending.
  • Commonwealth Games Scam (2010): The PAC investigated misuse of funds and corruption, highlighting poor financial planning.
• Ensuring Compliance: It ensures that financial transactions comply with the rules and regulations set by Parliament.
  • Coal Block Allocation Scam (2012): The PAC helped uncover losses of ₹1.86 lakh crore due to non-transparent coal block allocations.
• Holding the Executive Accountable: Though the PAC does not have executive powers, it brings irregularities to public attention, compelling the government to act.
  • The Public Accounts Committee, with 22 members (15 from Lok Sabha and 7 from Rajya Sabha), functions as a non-partisan body, as the Chairperson is from the Opposition.
  • This ensures objectivity and neutrality in financial scrutiny.

Limitations and Challenges:

• Lack of Enforcement Power: The PAC can only make recommendations; it lacks the authority to enforce corrective actions.
• Government’s Non-Binding Response: The executive is not obligated to implement PAC’s suggestions, leading to delayed or inadequate actions.
• Limited Time and Resources: The PAC examines a vast number of CAG reports, but time constraints prevent in-depth scrutiny of all cases.
• Political Interference: While the PAC is supposed to function in a non-partisan manner, political differences sometimes dilute its effectiveness.

Measures to Strengthen the PAC:

• Making PAC Recommendations Binding: The government should be required to respond to PAC recommendations within a fixed timeframe.
• Increasing Transparency: PAC reports should be made more accessible to the public to ensure greater accountability.
• Providing More Technical Support: The PAC should have access to financial experts, forensic auditors, and independent analysts to enhance its scrutiny.
• Strengthening Follow-Up Mechanisms: A monitoring framework should be created to track the implementation of PAC recommendations.

Conclusion

As former CAG Vinod Rai stated, “Accountability mechanisms like the PAC must evolve continuously to keep pace with the complexities of governance.” By empowering the PAC, India can enhance public trust in governance, curb financial mismanagement, and promote transparency in public expenditure.