The Public Accounts Committee — the PAC — is the oldest of India’s three financial parliamentary committees and the most powerful audit-scrutiny body Parliament has. Established in 1921 under the Government of India Act 1919, the Public Accounts Committee predates the Constitution itself. It survived the transition to independence, expanded in 1954 to include Rajya Sabha members, and today consists of 22 members — 15 from Lok Sabha and 7 from Rajya Sabha. The PAC’s mandate is narrow but deep: examine the audit reports of the Comptroller and Auditor General of India and report to Parliament whether public money has been spent legally, prudently, and for the purpose authorised.
For UPSC Polity, the Public Accounts Committee is the textbook case of legislative control over executive expenditure. It also illustrates a uniquely Indian convention: since 1967, the PAC chairman has come from the Opposition. This article walks through the origin, composition, functions, landmark inquiries, and reform debates around the Public Accounts Committee.
Origin: From 1921 to 1950
The Public Accounts Committee was set up in 1921 as part of the Montagu-Chelmsford reforms that introduced dyarchy. Its original role was to scrutinise the appropriation accounts and the audit reports of the Auditor General — to make sure the colonial executive spent only what the Central Legislative Assembly had voted, and on the purposes voted. The Finance Member of the Government chaired it.
After independence, the committee was continued under Article 105 and Article 118 of the Constitution and the Rules of Procedure of the Lok Sabha. In 1950, with the first Parliament, the PAC was reconstituted under Rule 308 of the Lok Sabha Rules. In 1954, Rajya Sabha members were added — bringing in the bicameral structure that survives today. The chair shifted from a government minister to a ruling-party MP, and then to an Opposition member from 1967 onwards.
Composition
The Public Accounts Committee has 22 members:
- 15 members elected by the Lok Sabha under the principle of proportional representation by the single transferable vote, from among its members.
- 7 members elected by the Rajya Sabha, by the same method.
- Tenure: one year, reconstituted every April.
- Chairman: appointed by the Speaker of Lok Sabha from among the Lok Sabha members of the committee.
- Ministers cannot be members — a deliberate firewall against executive influence over audit scrutiny.
- A member who later becomes a Minister automatically ceases to be on the PAC.
Opposition Chair Convention
Since 1967, by an unwritten convention introduced under Speaker Neelam Sanjiva Reddy, the PAC chairman is chosen from the Opposition. The logic is structural: the committee scrutinises government spending, so a ruling-party chair would create a conflict of interest. Past chairs include Bhagwant Singh Mann’s predecessors like Dr Murli Manohar Joshi, K.V. Thomas, and Adhir Ranjan Chowdhury. The convention is not in the Constitution; it survives because both sides find it useful.
Functions of the Public Accounts Committee
The PAC’s mandate, set out in Rule 308 of the Lok Sabha Rules, has four core functions:
1. Examine Appropriation Accounts and CAG Reports
This is the heart of the work. After the CAG audits central government accounts and tables reports, the PAC examines them. It investigates whether:
- Money shown in accounts as spent was authorised by Parliament’s appropriation acts.
- Expenditure conformed to the authority that governed it.
- Re-appropriations were within the rules.
- Disbursements were properly classified.
2. Examine Finance Accounts and Trading/Manufacturing Accounts
Beyond appropriation, the PAC examines the broader Finance Accounts of the Union, trading accounts, manufacturing accounts of government undertakings (where these are not covered by the Committee on Public Undertakings), and stores and stock accounts.
3. Examine Accounts of Autonomous Bodies
The PAC examines audit reports of autonomous bodies whose accounts are audited by the CAG — government-funded research councils, regulators, universities, and similar bodies.
4. Report Irregularities
When the PAC finds irregularities — losses, nugatory expenditure, infructuous spending, violations of financial propriety — it reports these to Parliament with recommendations for action. The committee can summon officials (typically the Secretary of the ministry concerned, not the Minister), examine witnesses, call for documents, and require explanations.
What the PAC Does NOT Do
This is as important as what it does. The Public Accounts Committee:
- Does not review policy — only execution. If the policy is wasteful, the PAC cannot say so; it can only check if the policy as approved was executed within rules.
- Does not look at expenditure that the CAG has not reported on. The PAC works downstream of audit.
- Does not summon ministers. By convention, ministers are not called to testify; only civil servants are.
- Does not bind the government. Its recommendations are recommendatory; government tables an Action Taken Report.
These limits are routinely flagged. The Murasoli Maran Committee (1993) had suggested several reforms — including extending the PAC’s reach to policy execution and giving it research support — but most recommendations have not been implemented.
Landmark PAC Inquiries
The PAC’s authority comes from a long history of consequential inquiries:
- Bofors howitzer payments (late 1980s) — examined CAG findings on the kickback allegations.
- 2G spectrum allocation (2010–11) — examined the CAG’s report that estimated a presumptive loss of ₹1.76 lakh crore. Politically explosive; the PAC report was disputed and not adopted by all members.
- Coal block allocations (2014) — examined CAG findings of windfall gains to private allottees.
- Commonwealth Games 2010 (CWG) expenditure — examined irregularities in stadium contracts and broadcasting deals.
- Defence procurements — periodic examinations of CAG reports on Rafale, AgustaWestland, Tatra trucks.
- Air India and PSU losses — examined audit findings on disinvestment and operational losses.
The 2G and coal inquiries are the most cited in UPSC material because they connected audit, judicial review (the Supreme Court cancellation of licences and coal blocks), and political fallout in a single chain.
Relationship with CAG
The PAC and the CAG are institutional twins. The CAG audits; the PAC scrutinises the audit. Without CAG reports, the PAC has nothing to examine. The Secretary to the CAG’s office briefs the PAC, and the CAG itself attends meetings. This is why the Comptroller and Auditor General is sometimes described as the “friend, philosopher, and guide” of the Public Accounts Committee.
Comparison with Other Financial Committees
| Feature | PAC | Estimates Committee | COPU |
|---|---|---|---|
| Set up | 1921 | 1950 | 1964 |
| Members | 22 (15+7) | 30 (LS only) | 22 (15+7) |
| Focus | Post-audit | Pre-audit (estimates) | PSU performance |
| Chair | Opposition (convention) | Ruling | Mixed |
| Reviews policy? | No | Suggests economies | Examines management |
All three are part of the broader Parliamentary Committees in India system, but the PAC is the only one that works on closed accounts and audited expenditure.
Reform Debate
The Public Accounts Committee is widely respected but its limits are real. The Murasoli Maran reforms, the NCRWC (2002), and PRS Legislative Research studies have all flagged:
- Time lag: PAC examines reports often two or three years after the events.
- Limited reach: cannot review policy, only execution.
- No enforcement: government can ignore recommendations.
- Witness limits: cannot call ministers, even for policy-execution questions.
- Support deficit: no dedicated research wing; relies on Lok Sabha Secretariat.
Suggested reforms include: a statutory backing for action on PAC reports, a dedicated audit-research cell, mandatory tabling of Action Taken Reports within six months, and expanding the PAC’s remit to performance audit. None have been legislated.
Recent Trends
In the 17th Lok Sabha, the PAC’s pace of work slowed because of pandemic disruptions and shorter sessions. Several CAG reports — particularly on defence and oil sector receipts — were tabled but not fully examined within the committee’s tenure. Reconstitution every April means inquiries often roll over to a new committee with new members, weakening continuity. The 18th Lok Sabha PAC, reconstituted in 2024, has prioritised pending CAG reports on infrastructure and PSU disinvestment.
PAC vs Comparable Bodies in Other Countries
The Indian Public Accounts Committee is modelled on the British PAC, set up at Westminster in 1861 under Gladstone. Most Commonwealth countries (the UK, Canada, Australia, New Zealand, South Africa) have similar bodies. The Indian PAC differs from the British in three ways: (i) bicameral membership (UK PAC is Commons-only), (ii) the strong Opposition-chair convention since 1967, and (iii) the closer working relationship with a constitutional CAG (the UK Comptroller and Auditor General is a statutory officer). The US has no direct equivalent — its Government Accountability Office (GAO) reports to Congress as a whole, and individual standing committees do PAC-style audit scrutiny.
How the PAC Examines a CAG Report
A typical PAC examination follows a pattern. The CAG tables a report in both Houses. The PAC selects audit paragraphs from the report for detailed examination, prioritising those with high financial stakes, systemic issues, or recurring irregularities. The committee then calls the Secretary of the concerned ministry and senior officials to give evidence in camera. Written replies, supplementary questions, and follow-up sessions can stretch over months. The committee then drafts a report with findings and recommendations, which is presented to the Speaker and laid on the Table of both Houses. The government must table an Action Taken Report within six months, indicating which recommendations are accepted, modified, or rejected.
Audit paragraphs that the PAC cannot examine within its one-year term are carried over to the next committee — which is why the backlog of unexamined CAG findings has become a structural concern.
Frequently Asked Questions
When was the Public Accounts Committee established?
The Public Accounts Committee was established in 1921 under the Government of India Act 1919, as part of the Montagu-Chelmsford reforms. It is the oldest parliamentary committee in India.
How many members are in the PAC?
The Public Accounts Committee has 22 members — 15 from Lok Sabha and 7 from Rajya Sabha, all elected by their respective Houses through proportional representation by single transferable vote.
Who chairs the Public Accounts Committee?
The chairman is appointed by the Speaker of Lok Sabha from among the Lok Sabha members of the committee. By convention since 1967, the chair has been from the Opposition.
Can the PAC review government policy?
No. The Public Accounts Committee examines whether money was spent as authorised — not whether the policy itself was sound. Policy review is outside its remit; it can only look at execution and audit findings.
What is the relationship between the PAC and the CAG?
The CAG audits government accounts and tables reports in Parliament; the PAC then examines those reports. Without CAG reports, the PAC has no material to scrutinise. The CAG is the PAC’s primary source of evidence.
Are PAC recommendations binding on the government?
No. The PAC’s recommendations are advisory. The government is expected to table an Action Taken Report indicating which recommendations have been accepted, partially accepted, or rejected.
What was the Murasoli Maran reform suggestion?
Murasoli Maran, as chairman of a 1993 committee, suggested expanding the PAC’s reach to policy execution, giving it research staff, and allowing it to examine ministers. Most of these suggestions have not been implemented.
Can ministers be summoned by the PAC?
By convention, no. Only civil servants — typically the Secretary of the ministry concerned — are called as witnesses. This convention insulates ministers from individual cross-examination on audit findings.
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