There is hardly any topic that has attracted a greater degree of debate in this country than that of corruption and accountability. However, all that clamour seems to have only benefited in rationalisation of military takeovers and creation of organisations like the National Accountability Bureau (NAB) that have further destroyed the system of accountability. It is high time an independent cost-benefit and impact analysis of NAB was carried out for a necessary restructuring to make it more productive as a specialised anti-corruption investigation agency.
There are multiple accountability institutions, starting from NAB, FIA, police, anti-corruption departments to the department of the Auditor General of Pakistan (AGP), yet none of these institutions inspire confidence with respect to proper use of public resources and safeguarding public interest. The performance of FIA and anti-corruption departments has over the years been dismal owing to excessive politicisation, lack of professionalism and ineffective oversight. The creation of NAB was aimed at addressing such gaps, especially eradication of white-collar crime and corruption by public office holders, but its outcomes have been quite the opposite. Instead of reducing rampant corruption, it has paralysed the decision-making process that is costing the nation hundreds of billions.
Based on over 35 years in the accountancy profession and public service, including extensive experience of working with federal and provincial governments and most of the major public sector institutions, it is my considered view that the solution to improving Pakistan’s governance is one of the critical imperatives for bringing positive change. One key element that needs the greatest attention is reform of the accountability system. This requires major improvements in the institutions of accountability that are already enshrined in the constitutional and legal framework. These include the department of the Auditor General of Pakistan (AGP), mandated under the Constitution for audit of accounts and operations of the federal, provincial and local governments; the Controller General of Accounts (CGA), responsible for accounting and financial controls of the federal and provincial governments; and the Public Accounts Committees (PACs) of the national and provincial assemblies, which are responsible to exercise effective oversight over these institutions of basic accountability on behalf of parliament and provincial assemblies.
In this article, I discuss the role, current status and material weaknesses in the oversight functions of Public Accounts Committees (PACs), which are the most important forums responsible for accountability in a Parliamentary system of governance. In subsequent articles, I will provide recommendations to strengthen the effectiveness of PACs, AGP and CGA, who together are responsible for accounting, internal control systems and audit of the federal and provincial governments, and are key instruments in the oversight of accountability. Obviously, comprehensive reforms in all these institutions will be required to transform the accountability system.
In the parliamentary system of governance that we inherited from the British, there are four major roles that our Parliament (National Assembly and Senate) performs at the federal level, and the provincial assemblies perform at the provincial level. The first is legislation – making laws under which the business of the state is carried out. The second is appointing the executive by electing the leader of the house /prime minister — who selects his/her cabinet which exercises executive authority under the Constitution. The third is authorising the annual budget proposed by the executive — which includes imposition of taxes to raise resources and authorising the expenditure that the executive can incur for the benefit of citizens. The fourth is accountability — holding the executive accountable for money raised and spent compared to the budget that was sanctioned and outcomes achieved. This fourth function of accountability that is largely exercised through the PACs unfortunately remains one of the weakest, due to which the country has not progressed, as there is virtually no accountability for outcomes.
The concept of the Public Accounts Committee, a special standing committee of Parliament, exists in almost all Commonwealth countries. It originated from the House of Commons in Britain in the 1860s when William Gladstone was chancellor of the exchequer, and later was adopted in most of the colonies. This committee performs almost the same functions as a Board Audit Committee does in the case of large corporations. In fact, in Australia, it is also called the ‘Joint Committee of Public Accounts and Audit of the Parliament’.
Like other Commonwealth countries, parliamentary oversight and the accountability function is performed by the PAC, which is formed under the Rules of Procedure of the National Assembly. It performs its functions mainly through examination of the reports on the accounts and the operations of the federation submitted by the AGP. Since 2008, the PAC has been led by the leader of the opposition.
While the PAC has existed during most of Pakistan’s history, it has remained ineffective and dysfunctional as, like most other forums, it has become highly politicised — its members being more concerned about the accountability of opponents rather than taking a holistic approach to addressing weaknesses in the internal control system, taking timely corrective actions on reported irregularities/corruption and fraud and advising actions based on understanding of the underlying causes of recurring errors and irregularities to safeguard the interest of citizens. Due to its outdated processes, the poor quality of audit reports, lack of capacity and legal mandate for the PACs to make their directions binding on the governments and the AGP, and absence of its role in the appointment of the AGP, there has been virtually no improvement in outcomes for the citizens.
Decades of oversight of the AGP and its reports by PACs has not resulted in any significant improvement in the effectiveness of audit methodology and reporting. Owing to lack of adequate knowledge and capacity, the PACs have not been able to provide required guidance to the AGP for adoption of modern technology and auditing standards that could have helped enhance the value of audits for the governments. The extent of paralysis of the PACs’ oversight over the AGP’s reporting can also be reckoned from the pendency of the AGP’s reports as follows: National Assembly 10 years, Punjab Assembly 10 years, Khyber Pakhtunkhwa Assembly 12 years, Sindh Assembly 22 years and Balochistan Assembly 28 years.
The writer is a former managing partner of a leading professional services firm and has done extensive work on governance in the public and private sectors.