Audit Bill gazetted but long way before Parliamentary sanction

The politically-beleaguered government is facing another challenge of establishing the office of the national audit office and the Sri Lanka state audit service; to specify the role of the auditor general over public finance and to make provision for matters connected to it, official sources said.

Minister of Lands and Parliamentary Reforms and the Chief Government whip Gayantha Karunatileka recently presented the National Audit Bill in Parliament.

The new bill will come up against strong opposition in Parliament as it has diluted certain important provisions, political analysts said.

If the National Audit Bill is not passed urgently by Parliament, incorporating strong deterrent oriented surcharge provisions along with further strengthening of the independence, professional capability and powers of the Auditor General, the establishment of an Audit Commission Office and the Sri Lanka State Audit Service will be further delayed, a senior government official said.

Several provisions included in the original bill which was to be enacted in Parliament by March 19, 2015 had to be changed due to pressure exerted by top officials of ministries and parliamentarians.

Amendments to the bill were approved by the Cabinet last October, removing the provisions in the bill, which allow the Auditor General to impose personal surcharges on public officials for financial misappropriation.

According to amended provisions, the powers to recover monies related to any fraud, negligence, misappropriation or corruption, have been vested in the Chief Accounting Officers (CAOs - e.g. Secretary to a Ministry or Department Head) instead of the Auditor General.

The new bill will vest vast discretionary powers in CAOs in determining the final surcharge.

Persons subject to an inquiry by the Auditor General are entitled to nominate others to appear on their behalf in accordance with the provisions of the new bill.

Furthermore, in the event that the CAOs themselves are subject to an inquiry, powers of imposing a surcharge have been vested in the President as the appointing authority.

However, if the President decides to impose a surcharge, the Bill does not provide a right of appeal to the CAO.

Although the Audit Service Commission investigates and reports on the amount of loss incurred and the individuals determined to have caused the loss, the CAO has the power to reduce the amount to be recovered, with no restriction and providing no justification, with the State not given an opportunity to appeal such action.

These amendments to the original bill have diluted the objective of strengthening accountability in public finance, analysts said.