PACs ensure efficient use of public money: Om Birla

1. At a Glance

• The Public Accounts Committee (PAC) is the oldest parliamentary committee in India. It checks spending after the money has been spent, to see whether funds Parliament granted were used within the scope of the demand [2][3].
• Parliament and the State legislatures each have a PAC. Lok Sabha Speaker Om Birla described them as the bodies that make sure public money is used efficiently and for the right purposes [1].
• The PAC is how the CAG's audit reports turn into political accountability. It is a core part of legislative control over the executive (GS-II) [2][3].
• Current issues: chronic delays (reports pending for 15–20 years), the convention of an Opposition chairperson, and the use of AI and data analytics to examine audit data [1].

2. Why in the News

• 3 November 2026 (Tuesday): Om Birla opened a two-day conference of PAC chairpersons from 25 States, hosted by the Keralam Legislative Assembly in Thiruvananthapuram [1].
• Rajya Sabha Deputy Chairman Harivansh, Keralam CM V. D. Satheesan and PAC Chairman K. C. Venugopal were present [1].
• Birla raised three points [1]:
• Long-pending PAC reports, some pending for 15–20 years, which he said "has to be addressed."
• Technology, data analytics and artificial intelligence should be used to analyse large volumes of expenditure data.

• The convention of an Opposition member as PAC Chairperson shows the "maturity, inclusiveness and strength" of India's parliamentary democracy.

• The Keralam CM asked for a discussion on how PACs should treat CAG reports [1].

3. Background & Evolution

• 1921: The PAC was first set up after the Montagu-Chelmsford Reforms (Government of India Act, 1919) [2][3].
• 1921–1950: The Finance Member of the Executive Council chaired it, so the executive was effectively checking itself [2][3].
• After 1950: Once the Constitution came into force, the PAC came under the control of the Lok Sabha Speaker, and a chairperson appointed by the Speaker has led it since [2][3].
• 1967: A change in convention began the practice of appointing a member of the Opposition as Chairperson. This has continued since [2][3].
• Recent chairpersons: Adhir Ranjan Chowdhury (appointed 2019, reappointed 2021) [3]. K. C. Venugopal (Congress) is the current chairman [1][2].
• Related earlier bodies: The PAC is one of three Financial Committees, together with the Estimates Committee and the Committee on Public Undertakings (COPU). CAG field offices support both the PAC and COPU [3][4].

4. Core Static Facts

Parameter	Fact
Nature	Standing committee, oldest in Parliament (since 1921) [2][3]
Strength	Up to 22 members: up to 15 from Lok Sabha and up to 7 from Rajya Sabha [2][3]
Selection	Lok Sabha members are elected every year [2][3]
Bar on membership	Ministers cannot be members [2][3]
Chairperson	Appointed by the Speaker, by convention from the Opposition since 1967 [2][3]
Documents examined	Appropriation Accounts, Finance Accounts, CAG audit reports [2][3]
Core test	Was money spent within the scope of the demand granted by Parliament? [2][3]
Other scrutiny	Losses, wasteful expenditure, financial irregularities, tax administration problems [2][3]
Expert support	The CAG assists the committee throughout its investigations; CAG has been called its "friend, philosopher and guide" (common usage) [2][3]
State level	Every State legislature has its own PAC; 25 States sent chairpersons to the 2026 conference [1]

General knowledge, not confirmed in this search; check before use: the PAC is constituted under Rule 308 of the Lok Sabha Rules of Procedure. CAG reports on Union accounts are laid before Parliament under Article 151. Rajya Sabha members are associated with the PAC; they are not elected to it by the Lok Sabha.

5. Multi-Dimensional Analysis

Legal / Constitutional

• The Constitution sets the CAG → Parliament reporting chain (Art. 151, unverified here). The PAC carries this chain through by examining those reports [2][3].
• The PAC is a post-mortem body. It reviews spending already made and does not approve future spending [2].
• The Speaker controls the committee after 1950. This removed the colonial-era practice of the Finance Member, an executive official, chairing it [2][3].

Ethical / Governance

• An Opposition chair and representation of all parties give bipartisan scrutiny. Birla called this a case of institutions "rising above political considerations" [1].
• Keeping ministers out of membership preserves the separation between those who scrutinise and those who are scrutinised [2][3].
• Reports pending for 15–20 years weaken deterrence. When findings arrive decades late, the officials involved may have retired and the lessons no longer apply [1].

Administrative

• The PAC relies on CAG audits, so its output can only be as timely and thorough as the CAG's reports [2][3].
• The Keralam CM asked how PACs should treat CAG reports. This points to the unresolved question of whether every audit paragraph must be examined or only selected ones [1].
• Recommendations depend on Action Taken Notes from ministries, and these often arrive late (general issue).

Scientific / Technological

• Birla's call for AI and data analytics is meant to deal with the large volume of audit data and to cut backlogs [1].
• Possible uses include flagging anomalies in expenditure, matching CAG observations with departmental replies, and dashboards to track pending reports.

Federal

• The Union and State PACs follow a common model. National conferences of chairpersons spread best practices to the States [1].
• The host was a State legislature (Keralam), which shows cooperation between legislatures across the federation [1].

6. Recent Developments (last 12–18 months)

• 3–4 Nov 2026: Two-day conference of PAC chairpersons, Thiruvananthapuram, hosted by the Keralam Assembly and opened by Om Birla [1].
• 2026: K. C. Venugopal is the PAC Chairman of the current Lok Sabha [1][2].
• Nov 2026: The Speaker publicly acknowledged a 15–20 year backlog in some PAC reports and called for AI-enabled analysis [1].

7. Prelims Hooks

• The PAC is the oldest parliamentary committee in India, first set up in 1921 [2][3].
• It was created after the Montagu-Chelmsford Reforms [2][3].
• Before 1950, the Finance Member chaired the PAC [2][3].
• After 1950, the PAC came under the control of the Lok Sabha Speaker [2][3].
• The Speaker appoints the PAC Chairperson [2][3].
• Opposition members have chaired the PAC by convention since 1967. This is not a statutory rule [2][3].
• Maximum strength is 22: 15 from Lok Sabha and 7 from Rajya Sabha [2][3].
• Ministers cannot be members of the PAC [2][3].
• Lok Sabha members of the PAC are elected every year [2][3].
• It examines the Appropriation Accounts, Finance Accounts and CAG audit reports [2][3].
• The CAG assists the PAC in its investigations [2][3].
• Current PAC Chairman is K. C. Venugopal (Congress) [1][2].
• The 2026 PAC chairpersons' conference was held in Thiruvananthapuram, with 25 States taking part [1].

8. Why PAC Reports Arrive Decades Late

• The PAC cannot examine every audit finding, so most findings depend on ministries replying
• The PAC picks only some CAG audit paragraphs for its own hearings. For the rest (the 'non-selected' paragraphs), the ministry must send an Action Taken Note (ATN: a written reply saying what it did about the audit finding) [6].
• The PAC (2013-14) examined this because ministries were taking far too long to send these notes [6].

• So the backlog is mainly on the executive's side, in ministries that do not reply. The committee's own speed is a smaller part of it.

• The deadline has been on paper since 1996 and is still missed

• The PAC's 105th Report (1995-96) gave ministries four months to submit ATNs, routed through the Finance Ministry's Department of Expenditure [6].
• CAG guidance now asks for ATNs within three months of a report being laid in the House. The CAG checks each ATN before it goes to the PAC [8].
• Even so, ATNs on 48 paragraphs from four ministries (including Finance and MeitY) were still pending in December 2021 [7].

• Missing the deadline costs a ministry nothing, so it keeps happening.

• The government and the auditor do not even agree on how many replies are pending

• On 30 June 2013, the Finance Ministry's Monitoring Cell counted 815 pending ATNs. The CAG counted 722 [6].
• Part of the gap came from delay: the CAG would drop a paragraph, but the ministry would learn of it only later [6].

• If the backlog cannot be counted correctly, nobody can be held responsible for clearing it.

• The same few departments cause most of the backlog

• Of the 722 pending paragraphs, 208 were from civil ministries, 169 from Railways, 143 from Defence and 112 from the tax boards (CBDT and CBEC) [6].

• So pressure on a few large spending and tax departments would clear most of it.

• The committee itself changes every year

• Lok Sabha members of the PAC are elected every year [2]. An inquiry that runs longer than a year can pass to new members who did not hear the earlier evidence.
• Add ministries that reply late, and a case can stay open for the 15–20 years Birla spoke about [1].

9. Why a Strong PAC Report Can Still Change Nothing

• The PAC can recommend but cannot order
• Its findings are advisory. The executive may decide not to accept them [2][5].

• So a report has force only if ministries reply and the House follows it up.

• The PAC acts only after the money is spent

• It is a post-mortem (after-the-event) body [2]. When it finds waste, the money is already gone.
• The IMF made the same point about the UK. There, ex-post scrutiny (checking after spending) by the auditor and the PAC is extensive, but ex-ante scrutiny (checking before spending) by Parliament is limited [10].

• India's PAC has the same limit. It can only discourage future waste, and a 15-year delay makes even that weak.

• The Keralam CM's question is really about who sets the agenda

• He asked how PACs should treat CAG reports [1].
• If the PAC hears only the paragraphs it selects, the remaining findings depend on ATNs, which ministries delay [6][7].
• If it tries to hear every paragraph, it falls even further behind.
• The real choice is between covering more findings and examining each one more deeply. The rules do not settle it.

10. What the UK Does to Force a Government Reply

• In the UK, every PAC recommendation gets a public written reply
• The National Audit Office (NAO, the UK's version of the CAG) writes value-for-money reports. The PAC questions officials on them and publishes recommendations [9].
• The government must respond. HM Treasury publishes the replies together in the Treasury Minutes [9].

• Some PAC reports and their Treasury Minutes are then debated in the House [9].

• The reply leads to real changes later

• In the November 2012 Treasury Minutes, the UK transport department said it now gave more weight to downside risks (what could go wrong) in project business cases [9].

• The NAO later checked that promise in its own 2014 report [9].

• India has ATNs, but the replies are not brought together in public

• Indian ATNs pass from the ministry to the CAG for checking and then to the PAC [8].
• There is no single public document like the Treasury Minutes, so a late or missing reply is hard for the public to see.

11. Can AI Clear the Backlog? Only Part of It

• AI can fix the counting problem
• The 815-versus-722 mismatch came from two offices keeping separate records [6].

• One shared digital tracker of every audit paragraph, seen by the ministry, the CAG and the PAC, would remove that gap. This is the kind of use Birla had in mind [1].

• AI cannot make a ministry reply

• The main hold-up is late ATNs [6][7]. Software can show which reply is late. It cannot make a department send it.

• Without a consequence for missing the deadline, faster analysis only shows the delay more clearly.

• AI can help the PAC choose what to examine

• Spotting unusual spending patterns (anomaly detection) across large volumes of expenditure data could help the PAC pick the paragraphs most worth a hearing [1].
• That speaks directly to the Keralam CM's question about how to treat CAG reports [1].

12. Who Must Act, and How

• Department of Expenditure: publish ATN pendency by ministry
• The PAC's 105th Report already made the Finance Ministry the channel for ATNs [6].

• A regular public list of overdue ATNs, ministry by ministry, would work like the UK's Treasury Minutes [9].

• CAG and the Finance Ministry: keep one shared record of pending paragraphs

• This ends the mismatch between the two counts, and drops (deletions) show up for everyone at once [6].

• PAC: hold hearings with the departments that have the most pending replies

• Railways, Defence and the tax boards made up a large part of the pending paragraphs [6].

• Calling their secretaries to explain the delays would clear most of the backlog quickly.

• Speaker and the Lok Sabha: set aside time to debate PAC reports and replies

• The UK debates some PAC reports together with the government's replies [9]. Floor time puts political pressure on ministers to act, which an advisory report alone cannot do [2].

13. Anchors for Answers

• Data: 815 pending ATNs (Finance Ministry count) against 722 pending paragraphs (CAG count) on 30 June 2013. Railways had 169 of them and Defence 143 [6]
• Data: ATNs on 48 paragraphs from four ministries still pending in December 2021 [7]
• Report/Committee: PAC 105th Report (1995-96), which set a four-month ATN deadline [6]. PAC (2013-14/2014-15) report on ministries not sending ATNs on time [6]
• Law/Case: CAG reports on Union accounts are laid before Parliament under Article 151. The ATN deadline is three months from laying, and the CAG checks each ATN [8]
• Comparison: UK: the government must answer every PAC recommendation in the public Treasury Minutes, and some are debated in the House [9]. The IMF says the UK's ex-post scrutiny is strong but its ex-ante scrutiny is weak [10]

14. Mains Relevance

• GS-II: Parliament and State Legislatures, covering structure, functioning, conduct of business, and powers and privileges. Also appointment, powers and responsibilities of constitutional bodies (CAG), and transparency and accountability in governance.
• GS-III (secondary): Government budgeting and public expenditure management.
• GS-IV (secondary): Accountability and probity in public life.
• Question stems: 1. The Public Accounts Committee is often described as the watchdog of the watchdog's reports. Examine its role in ensuring financial accountability of the executive, and suggest measures to address delays in its functioning. (15 marks) 2. The convention of appointing an Opposition member as Chairperson of the PAC reflects the maturity of Indian parliamentary democracy. Discuss, with reference to the effectiveness of parliamentary financial committees. (10 marks) 3. Can technology such as AI and data analytics strengthen legislative oversight of public expenditure? Discuss in the context of the CAG–PAC relationship. (15 marks)

15. Related Topics to Study Next

• CAG (Arts. 148–151): The PAC's main input is CAG audit reports.
• Estimates Committee: A financial committee that is often confused with the PAC. It examines estimates and suggests economies, and has Lok Sabha members only.
• Committee on Public Undertakings (COPU): The third financial committee, which examines CAG reports on PSUs [3].
• Departmentally Related Standing Committees (DRSCs): Committees that scrutinise the budget before it is passed, compared with the PAC's review after spending.
• Joint Parliamentary Committee vs PAC: An ad hoc committee compared with a standing one, a frequent debate during probes of scams [5].
• Appropriation Bill and Finance Accounts: Explain what "spending within the scope of the demand" means.
• Parliamentary privileges and the Speaker's powers: The Speaker controls committees and appoints chairpersons.

16. NCERT Concepts to Revise

• Public Accounts Committee (Polity): The article's central body: it checks after spending whether money was used within what Parliament granted.
• Comptroller and Auditor General (Polity): CAG audit reports are the PAC's main input, and the Keralam CM asked how PACs should treat them.
• Speaker of the Lok Sabha (Polity): The Speaker appoints the PAC chairperson and controls the committee, and Om Birla is the Speaker.
• Estimates Committee (Polity): Another financial committee that is often confused with the PAC; its size and role differ.
• Committee on Public Undertakings (Polity): The third financial committee alongside the PAC; it examines audit reports on public sector undertakings.
• Appropriation Bill (Polity): Explains the grants Parliament authorises, which is the 'scope of the demand' the PAC checks spending against.

17. Common Errors / Trap Areas

• Opposition chair is a convention (since 1967) and not a statutory rule [2][3].
• The Speaker appoints the chairperson. The committee does not elect its own chair [2][3].
• Composition: PAC has 22 members (15 LS + 7 RS). The Estimates Committee has 30 members, all from Lok Sabha. Do not swap the two (Estimates figure is general knowledge).
• Origin year 1921 (Montagu-Chelmsford). Do not confuse it with 1950 (when the Speaker took control) or 1967 (when the Opposition-chair convention began) [2][3].
• The PAC reviews spending after it happens. It cannot stop or approve expenditure in advance, and its recommendations are advisory and not binding [2].