Forest Services
Introduction: Parliamentary Committees and Fiscal Oversight
Parliamentary Standing Committees (PSCs) in India are permanent bodies constituted under Article 105 and Article 118 of the Constitution. They function throughout the year to scrutinize government functioning, especially fiscal governance. Key financial committees include the Public Accounts Committee (PAC), Estimates Committee, and Committee on Public Undertakings, constituted under constitutional provisions and Lok Sabha Rules (Rules 308-312, 310, 310A). These committees enable detailed, continuous, and non-partisan examination of government expenditure, supplementing parliamentary debates which are often limited in time and detail.
UPSC Relevance
- GS Paper 2: Parliament and its Committees, Accountability and Transparency in Governance
- Essay: Role of Parliamentary Committees in strengthening democratic oversight
- Mains: Questions on fiscal oversight mechanisms and their effectiveness
Constitutional and Legal Framework Governing Parliamentary Committees
The Constitution under Article 105(5) and Article 118(3) mandates the formation of the Public Accounts Committee to examine audit reports of the Comptroller and Auditor General (CAG). The Estimates Committee and Committee on Public Undertakings are constituted under the Rules of Procedure and Conduct of Business in Lok Sabha (Rules 310 and 310A respectively). The Department-Related Standing Committees (DRSCs) are governed by Rules 308 to 312 and cover 24 ministries, including the Parliamentary Standing Committee on Finance, which scrutinizes the Ministry of Finance and related departments.
- PSCs have a statutory mandate to examine Demands for Grants, Bills, and policy issues related to ministries.
- They submit reports to Parliament, which are tabled and form the basis for parliamentary discussions.
- Standing Committees’ reports are not binding but carry significant moral and political weight.
Economic Significance of Parliamentary Fiscal Oversight
The Union Budget 2023-24 allocated over ₹1.1 lakh crore to NITI Aayog and related planning bodies. However, the Parliamentary Standing Committee on Finance (PSC-Finance) reported fund utilization below 36% in FY24 and FY25, indicating severe underutilisation and poor financial management. This underperformance risks delaying developmental projects critical to sustaining India’s GDP growth, which was 7% in FY23 (Economic Survey 2024). The PAC audits government expenditure exceeding ₹150 lakh crore annually, highlighting the scale of fiscal oversight required.
- Low fund utilisation signals inefficiencies in execution and monitoring of government schemes.
- Delayed projects affect infrastructure development, employment generation, and overall economic growth.
- Estimates Committee reviews budget estimates exceeding ₹150 lakh crore, recommending economies and efficiency improvements.
Key Parliamentary Committees Involved in Fiscal Governance
| Committee | Constitutional/Legal Basis | Primary Function | Scope |
|---|---|---|---|
| Public Accounts Committee (PAC) | Article 105(5), Article 118(3) | Examines CAG audit reports on government expenditure | All government departments and expenditures |
| Estimates Committee | Rule 310, Lok Sabha Rules | Reviews budget estimates and suggests economies | Union Budget estimates and expenditure plans |
| Committee on Public Undertakings | Rule 310A, Lok Sabha Rules | Examines performance of public sector undertakings | Public sector enterprises |
| Department-Related Standing Committees (DRSCs) | Rules 308-312, Lok Sabha Rules | Scrutinizes Demands for Grants, bills, and policies of ministries | 24 ministries including Finance, Planning, etc. |
Comparative Analysis: India vs UK Public Accounts Committees
The UK’s Public Accounts Committee, established under the House of Commons, wields stronger enforcement powers, including summoning officials and compelling evidence. It enjoys bipartisan consensus and active media engagement, which enhances public accountability and leads to a 15% higher recovery rate of misused funds compared to India (UK National Audit Office Report, 2023). In contrast, Indian PSCs often face delays in report submission, lack binding enforcement powers, and have limited public dissemination of findings.
| Feature | India | United Kingdom |
|---|---|---|
| Constitutional Basis | Articles 105, 118; Lok Sabha Rules | House of Commons Standing Orders |
| Enforcement Powers | Advisory; no binding enforcement | Can summon officials; binding recommendations |
| Public Engagement | Limited media coverage; reports not widely publicized | High media engagement; public hearings |
| Recovery of Misused Funds | Lower rate; limited follow-up | 15% higher recovery rate |
| Partisanship | Often partisan delays | Bipartisan consensus |
Challenges Limiting Effectiveness of Parliamentary Committees in India
- Delays in Report Submission: Committees often exceed deadlines, reducing the timeliness of oversight.
- Lack of Enforcement Powers: Recommendations are advisory; the executive is not legally bound to implement them.
- Limited Public Dissemination: Reports are not always widely publicized or debated, reducing public pressure on the executive.
- Political Partisanship: Committee functioning can be hampered by political bias, affecting non-partisan scrutiny.
- Resource Constraints: Limited research support and expert inputs restrict in-depth analysis.
Significance and Way Forward
- Strengthening enforcement mechanisms by linking committee recommendations to executive accountability can improve fiscal governance.
- Improving transparency through wider dissemination of committee reports and media engagement will enhance public scrutiny.
- Capacity building for committees via expert support and timely access to data will enable more rigorous analysis.
- Institutionalising bipartisan cooperation can reduce political delays and improve report quality.
- Leveraging technology for real-time monitoring of fund utilisation can assist committees in timely interventions.
- Department-Related Standing Committees are constituted under Article 105 of the Constitution.
- The Public Accounts Committee examines audit reports of the Comptroller and Auditor General.
- The Estimates Committee has binding powers to enforce its recommendations on the executive.
Which of the above statements is/are correct?
- PAC is constituted under the Rules of Procedure of Rajya Sabha.
- PAC examines the appropriation of funds granted by Parliament.
- PAC’s reports are binding on the government.
Which of the above statements is/are correct?
Jharkhand & JPSC Relevance
- JPSC Paper: Paper 2 – Indian Polity and Governance
- Jharkhand Angle: Effective fiscal oversight by Parliamentary Committees can improve fund utilisation for state development schemes in Jharkhand, which faces challenges in budget execution.
- Mains Pointer: Highlight the role of PSCs in ensuring accountability in planning and expenditure, linking it to Jharkhand’s developmental needs and fiscal management.
What is the constitutional basis for the Public Accounts Committee?
The Public Accounts Committee is constituted under Article 105(5) and Article 118(3) of the Constitution of India. It examines the audit reports of the Comptroller and Auditor General relating to government expenditure.
How do Department-Related Standing Committees differ from Financial Committees?
Department-Related Standing Committees examine Demands for Grants, bills, and policies of specific ministries, while Financial Committees (PAC, Estimates Committee, Committee on Public Undertakings) focus on audit reports, budget estimates, and public sector undertakings respectively.
Why is fund utilisation by NITI Aayog significant in fiscal governance?
Fund utilisation below 36% in FY24 and FY25, as reported by PSC-Finance, indicates inefficiency in executing planned schemes, risking delays in developmental projects and impacting overall economic growth.
What are the main challenges faced by Parliamentary Committees in India?
Challenges include delays in report submission, lack of binding enforcement powers, limited public dissemination, political partisanship, and resource constraints affecting detailed scrutiny.
How does the UK Public Accounts Committee differ from India’s PAC?
The UK PAC has stronger enforcement powers, bipartisan consensus, and greater media engagement, leading to higher recovery of misused funds compared to India’s PAC, which has advisory powers and limited public visibility.