State keeps spending, but accountability loop never closes

Sketch: TBS

Audit objections worth Tk31 lakh crore, accumulated since independence, remain unresolved, more than three and a half times the proposed budget. How did such a mountain build up?

The Constitution created the Office of the Comptroller and Auditor General as an independent body, sitting apart from the executive, the legislature and the judiciary, precisely to check whether public money is spent lawfully, for the purpose Parliament granted, and with value for money. 

When India's Constitution was framed, and we borrowed much of ours from it, Ambedkar called this office probably the most important in the whole document, and insisted it be as independent as the judiciary. 

But the office's effectiveness depends entirely on a functioning Parliament, and in particular on the Public Accounts Committee. For long stretches, our Parliament has been absent or dysfunctional; the committee has often not existed, or has not been equipped to act. 

The auditor does his work and submits his reports, but the chain that is meant to act on them is broken. So the objections simply pile up, decade after decade.

In Britain and India, the Public Accounts Committee is chaired by the opposition, by convention. Why does that matter, and what happens when, as here, the ruling party always holds the chair?

The committee is the principal forum where the executive answers for its irregularities, so it is given to the opposition, so that the scrutiny is real. No law requires it, but nobody breaks the convention. In Bangladesh it has almost always been chaired by a member of the governing party. 

The committee has no properly resourced secretariat, its members are not always carefully chosen, and even when it makes recommendations, the executive does not comply. In Britain, the Treasury must report back to Parliament every three months on what it has done about each recommendation. 

We once had a cell in the Finance Ministry to coordinate that; it no longer exists. The feedback loop is simply absent.

Let's strip away the technical language. When an audit objection is raised and never settled, what does it actually mean for the ordinary taxpayer?

Public finance rests on a social contract: people pay tax, and the state is morally, constitutionally and legally bound to spend it on their welfare, lawfully, and as a prudent person would spend his own money. An unsettled objection means one of those conditions was not met. 

The picture it paints is clear enough. Where the money is wasted, it is money that could have gone to education, to health, to building human capital. Spent properly, we would have less budget and more public service. What we have instead is the opposite: more budget, and less public service.

You were Comptroller and Auditor General from 2018 to 2023. From that vantage point, what kinds of irregularity recur in our public spending?

Recall the Rooppur pillow scandal. The audit report found corruption at every step of a Tk169 crore procurement for a single residential building: each pillow billed at Tk5,957, with a further Tk760 to carry each one up to the room; a comforter priced at Tk16,800 against a market rate of Tk4,000 to Tk13,000. That is not an isolated case. 

Money is drawn without any procurement at all, the paperwork manufactured afterwards. Engineering departments collect bills for roads and bridges that were never built. A contract is sub-let three and four times, 20% lost at each hand. The villagers put it plainly: of every Tk100 sent, Tk40 or Tk50 arrive.

Illustration: TBS

If the problem is structural, what is the structural fix?

Bring the budget closer to the people. At present the central budget covers everything, down to a bridge in a village, with no bottom-up planning; local government, which the Constitution provides for, is effectively absent from it. 

The central budget should be thinner, confined to genuinely national matters such as inter-district highways, defence and foreign affairs, and the rest should pass to local government as grants on a transparent, indicator basis, more to the poorer areas. 

With it must go what I call the three Fs: finance, function and functionary. The local government must control its own budget, decide on its own schools and clinics through local consultation, and employ its own staff, rather than have them posted in by a distant ministry. The waste otherwise is plain. 

A hospital is built under the development budget over five years; the doctors and technicians to run it come from the revenue budget, which can take another five. 

So the building stands, but the service it was meant to deliver never arrives, and even the structure is wasted.

You have written that a recent ordinance threatens the independence of your former office. What is the concern?

The Constitution is unambiguous: the Auditor General is subject to the direction of no person or authority. Nobody is his boss; his boss is his conscience and the Constitution. 

Yet the Public Audit Act framed under the interim government gives him rule-making power only with the prior approval of the government, and contemplates his entering into agreements under government sanction. 

That is plainly unconstitutional; it places the watchdog back under the very executive it is meant to audit. I said so in a newspaper article, and I told the advisers directly that it could not be done. As best I can tell, the gazette was rushed through overnight soon afterwards.

Parliament recently passed a Tk56,000 crore supplementary budget for money already spent. Is that the accountability working, or a symptom of the same problem?

It is a symptom. A supplementary budget, properly understood, is for future expenditure that Parliament sanctions in advance. When the money has already been overspent, that is not a supplementary but an excess budget, and an excess budget must be scrutinised by the Public Accounts Committee before Parliament approves it; even a single crore overspent requires that. 

In our entire history since independence, that scrutiny has never once happened; the spending is simply regularised after the fact. 

Until Parliament, the committee and the audit office are all made to function together, the loop will never close, and the mountain will only grow.