CAG seeks Centre's consent to widen scope of audit

Rahul Wadke Mumbai | Updated on February 07, 2011

In a move to cast a wider net, the Comptroller and Auditor General of India (CAG) has written to the Centre seeking to bring non-governmental organisations (NGOs), public-private partnership (PPP) projects and the District Rural Development Agency (DRDA) under its purview.

A senior CAG official, on condition of anonymity, told Business Line that some NGOs get funding from the Government and therefore, they should be open to audit by the CAG.

“The Government knows nothing about their fund utilisation yet they continue to get money from the government coffers. Plus they get money from foreign sources, whose identity is nebulous,” the official said.

State Govt opinion

In a related development, the Finance Ministry has also written to all State governments seeking their opinion about the kind of additional powers that could be given to the CAG.

According to media reports, in November 2010, the CAG in its audit report on the Ministry of Environment and Forest, had indicated there were some irregularities in the process of giving grants by the Ministry to the NGOs.

The CAG also wants to audit of projects which are being built on the PPP model . In these projects, the Government's equity is less that 49 per cent. But if the value of land provided by the Government for the project is added, then it can shoot up to as high as 80 per cent in some projects. Governments have little insight into the financial details of these projects, as they are implemented by private companies, the official explained.


“In many infrastructure projects, private companies increase user charges, but the logic behind the increase is never shared with the Government. The new powers will help in unravelling the reasons behind the hike,” the official said.

Another significant step is the CAG's move to audit the District Rural Development Agency (DRDA), a State government body present in all districts.

The financial dealings of the DRDA have always been outside the purview of CAG audit, as DRDA is registered as a society under the Indian Societies Registration Act of 1860. Now, the CAG is keen on auditing the books of DRDAs as very large sums of money for rural development are sent to them, the official added.

Published on February 07, 2011

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