Competent, Empowered Auditor General

2018-01-28

What Sri Lanka needs is teeth to prosecute white collar crime/criminals in Government if such empowerment is lacking in law.

It's nice to have various reports, official or otherwise, highlighting financial irregularities and waste in Government and in Government institutions. But if such findings are confined to reports only, those by itself are a waste of public funds, especially with respect to official reports in particular.
The country's 219-year-old Auditor General's (AG's) Department, year-in-year out publishes audit reports in respect of the financial performances of various Government bodies, as the Government auditor.

The AG, acting as the devil's advocate relating to public finance, goes through the financial reports of various Government bodies, covering departments, boards, corporations and such like and gives his opinion in respect of expenditure incurred by these institutions.

Being it his duty to highlight any irregularities and/or questionable expenditure pertaining to such accounts, the AG discharges those responsibilities. Government accounts, in this instance, the historical performances of such institutions, are expected to be prepared annually.

It is in respect of such annual accounts that the AG gives his opinion.

The AG maybe considered as being the first line of defence to check any financial irregularities in State institutions. The other being the Committee on Public Enterprises (COPE) and/or Committee on Public Accounts (COPA), two Parliamentary oversight committees on public finance, seemingly having more teeth than the AG as COPE and COPA members comprise the country's lawmakers.
But the reality is that neither the AG nor COPA or COPE has powers to ensure that their opinions and/or recommendations are implemented. Implementation is in the hands of the Government in power.

Therefore, if a Government so wishes, it can simply wait, doing nothing over the recommendations made. This brings into question the validity of the AG, COPE and COPA.

If the AG, COPE and COPA lack teeth, having such bodies in place, coupled with the reams and reams of reports they annually prepare, are also a waste of public funds and time.

For the AG, COPE and COPA to be valid, those bodies need to have teeth. COPE and COPA may comprise a mix of Opposition and Government lawmakers, thereby ensuring to an extent, if not more, the impartiality of the findings of such Parliamentary oversight committees, though implementation may be another matter.

Meanwhile, the AG functions as a public servant, where his rights, in the first line of defence, are protected by the Public Service Commission and if that fails, by Court. However, the AG, being a mere mortal, may also be prone to err.

His findings, vis-à-vis the accounts of State institutions, may also be prone to error. Therefore, there may be a need to strengthen the professionalism of the Auditor General's Department, while ensuring its independence.

One of the biggest challenges that the Government may face if it's keen on strengthening the AG, is to attract professionals to serve in this Department. For that, two ingredients will have to be fulfilled. Those are to lure professionals by offering them attractive salaries and the other, to ensure their independence.

While luring professionals by offering them higher salaries and at the same time ensuring the independence of the AG go hand in hand, the third most important ingredient needed, after the first two are fulfilled, is to act upon the recommendations given by the AG.

The combination of all of these three ingredients will make a functional AG, fulfilling the aspirations of the taxpayer. It's hoped that the proposed Audit Bill will take all of these three matters into consideration.

To attract the best of talent, remuneration on par with those offered by private audit companies will have to be made. That may be challenging because the Government since 1978 has been running continuous budget deficits.

The planned uplift in revenue by computerizing revenue collection starting with Customs, the island's largest revenue collector, if implemented, may be the beginning in finding the funds needed to make the AG professional, if the Government is serious in this endeavour.

Independence may be fortified by having an Audit Commission, functioning under the Constitutional Council, in place, which hopefully will transform the Auditor General's recommendations to implementation.