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Home News Power Sector News CAG criticises CERC for keeping surplus income outside govt A/Cs

CAG criticises CERC for keeping surplus income outside govt A/Cs

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CERCThe Comptroller and Auditor General of India (CAG) criticised the practice of key financial sector regulators retaining the surplus and income generated through charge of fees outside government accounts. The CAG, the government’s statutory auditor, has said the practice contravenes constitutional provisions and instructions of the finance ministry. It has named capital markets regulator SEBI, insurance regulator IRDA, Pension Fund Regulatory Development Authority as the financial regulators that have retained their surplus funds and income made through charging of fees outside the government’s accounts.

The department of economic affairs had in January 2005 directed all ministries and government departments to ensure that funds of regulatory bodies are maintained in the Public Accounts. Two other regulators –– Central Electricity Regulatory Commission (CERC) and offstream regulator Petroleum and Natural Gas Regulatory Board (PNGRB) –– have also been found to be indulging in this practice, the report said.

The CAG reports comes at a time when experts have raised questions about regulatory autonomy in the backdrop of the announcement for creation of Financial Stability and Development Council, a kind of a super regulator to be chaired by the finance minister.

“The finance accounts of the union government, therefore, do not present a correct and complete picture of government finances to the extent of funds of Rs 1747.37 crore lying outside government accounts,” the CAG said in its report report on union government accounts for 2008-09, tabled in the Parliament on Friday.

The total sum not shown correctly because of this erring practice aggregates to Rs 1,747 crore at the end of March 2009, highlighted the CAG.

Source- Economic Times

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