Auditor General of Pakistan invites PM’s anger

ISLAMABAD: Prime Minister, Imran Khan has expressed his dissatisfaction over the Auditor General of Pakistan’s performance after Prime Minister's Inspection Commission found “massive corruption” in the organisation, well-informed sources told Business Recorder.

Prime Minister expressed his displeasure about the organisation, at a meeting of Federal Cabinet held on January 12, 2021 when a Bill for new legislation titled "the Auditor General's (Functions, Powers and Terms and Condition of Service) Act, 2020 and Repeal of the Auditor General's (Functions, Powers and Terms and Conditions of Service) Ordinance, 2001' came under discussion.

The Finance Division briefed the Cabinet that considering the pivotal role of the Constitutional Office of the Auditor General of Pakistan (AGP) in accountability, transparency and overall governance in the country the Federal Cabinet directed Dr. Ishrat Hussain, Advisor to the Prime Minister for Institutional Reforms and Austerity, to submit proposals for strengthening and re-organizing the office of the Auditor General of Pakistan.

In order to develop these proposals, Dr. Ishrat Hussain held a series of meetings with the senior management of the AGP and the Controller General of Accounts (CGA) during May-Aug 2019 to draft proposals for submission before the Cabinet. The Advisor to the Prime Minister for Institutional Reforms and Austerity sent a report to Advisor to the Prime Minister on Finance and Revenue mentioning therein the following six pillars of the reform package: (i) Strengthening the office of the Auditor-General of Pakistan by ensuring its autonomy and independence; (ii) strengthening the competence and professionalism in the officers and staff of the AGP Office;(iii) shift from present audit para intensive audit approach to sectoral and thematic specialization among the audit staff in critical emerging areas such as Information Systems Audit, Debt Audit, Forensic Audit etc;(iv) automation and business process re-engineering by introducing Audit Management Information System (AMIS) for improved financial disclosures and transparency; (v) developing a new Performance Management System linking increments and awards with performance outcomes and; (vi) effective audit follow up.

It was noted that the importance of office of AGP cannot be over-emphasized considering its role in ensuring good governance and accountability. Articles 168 to 171 of the Constitution of of Pakistan inter-alia, authorize the Auditor General of Pakistan to conduct audit of accounts of the Federal and Provincial Governments and the accounts of any authority or body established by, or under the control of the Federal or Provincial Governments.

The Auditor General of Pakistan has continued to perform such functions under President's Order 21 of 1973. The Federal Government, in 2001, promulgated the Auditor General's (Functions, Powers, and Terms and Conditions of Service) Ordinance No. XXIII of 2001.

Article 170 (2) of the Constitution Pakistan which was added to it through the 18th Amendment, enhances the mandate and role of the Auditor General of Pakistan by empowering him to audit any agency controlled or established by the Federal and Provincial Government. In order to comply with the said provision of the Constitution, amendment in the AGP Ordinance, 2001 is required. Further, six (06) pillars of the reform package, identified by the Advisor to the Prime Minister for Institutional Reforms and Austerity in his report also warrant amendments in the existing Ordinance. In this background, Auditor General of Pakistan had proposed a new legislation titled "The Auditor General's (Functions, Powers and Terms and Conditions of Service) Act, 2020", which would repeal existing Ordinance of 2001 in order to remove ambiguities and hindrances for ensuring transparency and accountability through independence of audit as well as effective functioning of the Department of Auditor General of Pakistan in the light of international best practices. The Draft AGP's Act, 2020 was extensively deliberated in the Finance Division with representation from Department of Auditor General of Pakistan, Establishment Division and Cabinet Division. Accordingly, draft of AGP's Act, 2020 finalized by the Finance Division was sent to Law Division for vetting. Law Division, however, returned the draft Act un-vetted with an advice to seek, in principle the approval of the Federal Cabinet, as required under sub-rule (1) of rule 27 of the Rules of Business, 1973 since the proposed Act is a new legislation seeking repeal of the existing Ordinance of 2001.

In terms of Rule-16(l)(a) & (b) of Rules of Business 1973, proposals for legislations, promulgation and revocation of Ordinances, are required to be brought before the Cabinet.

The Finance Division sought, in principle, approval of the Federal Cabinet to proceed further, as per law/rules, for submitting a Bill for new legislation titled "the Auditor General's (Functions, Powers and Terms and Conditions of Service) Act, 2020" and repeal of "the Auditor General's (Functions, Powers and Terms and Conditions of Service) Ordinance, 2001".

During a discussion, the Prime Minister enquired about the automation of AGPR to curtail human interface, as massive financial corruption had been reported in the department by the Prime Minister's Inspection Commission. He was informed that the system of electronic payments was being introduced and already some of the Ministries/Divisions had switched to the new arrangement. It was pointed out that increased focus on performance audit by AGP, as part of the six indicative pillars, may be beyond its Constitutional mandate and the capacity of the organization. It was suggested that this issue may be examined from a Constitutional viewpoint. It was further emphasized that the role/ mandate of the Auditor General must be strengthened within the Constitutional provisions as stipulated in Article 169.

Copyright Business Recorder, 2021