ISLAMABAD: The federal government is likely to replace existing Auditor General’s (Functions, Powers and Terms and Conditions of Service) Ordinance, 2001 with a new legislation, aimed at giving more independence to the Auditor General of Pakistan (AGP), well-informed sources told Business Recorder.
Sharing the details, sources said, considering the pivotal role of the constitutional office of the 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 reorganizing 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 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.
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 Pakistan, 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.
Auditor General of Pakistan continued to perform such functions under President’s Order 21 of 1973. The Federal Government, in 2001, promulgated Auditor General’s Functions, Powers, and Terms and Conditions of Service) Ordinance No. XXIII of 2001.
Article 170 (2) of the Constitution of Pakistan, added through 18th Amendment in the Constitution, 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.
Finance Ministry argues that in order to comply with the said provision of the Constitution, an amendment in AGP Ordinance 2001 is required. Further, six pillars of the reform package, identified by 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 has proposed a new legislation titled “The Auditor General’s (Functions, Powers and Terms and Conditions of Service) Act, 2020”, which will 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 Finance Division with representation from Department of Auditor General of Pakistan, Establishment Division and Cabinet Division. Accordingly, draft of the 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 approval of the Federal Cabinet, as required under sub-rule (1) of the Rules of Business, 1973 since the proposed Act is a new legislation, promulgation and revocation or Ordinance, are required to be brought before the Cabinet.
The Finance Ministry has sought approval, in principles 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 “the Auditor General’s (Functions, Powers and Terms and Conditions of Service) Act, 2001”.
Finance Ministry maintained that simultaneously, the office of AGP is required to continuously submit a progress report on the reform pillars to the Cabinet Committee on Institutional Reform so that the increased functional independence is used by the Auditor General to bring about substantial improvements in the process of audit.