PM CARES: A quick fix solution

WHAT IS PM CARES FUND?

PM CARES Fund is a public charitable trust formed with the primary objective of dealing with any kind of emergency or distress situation, like COVID-19 pandemic. The trust consists of PM as the ex-officio chairman, along with Defense Minister, Minister of Home Affairs and Finance Minister as trustees. Chairman can further appoint three trustees eminent in fields of research, health, science, social work, law, public administration and philanthropy.

This move has been highly criticized by the opposition leaders questioning the need for such fund when PMNRF already exists. Prime Minister National Relief Fund was formed by Jawaharlal Nehru in 1948. The funds have to be disbursed on the discretion of PM.

AUDIT

CAG is the supreme audit institution of the country meant to ensure accountability. Its independence is ensured by several provisions like appointment by President, special procedure for removal and disallowing his holding of any other government office after the expiry of the term. The audit domain of CAG includes almost every spending, revenue collecting or aid/ grant receiving unit of the government.

The audit report prepared by CAG is submitted to the President, which is then tabled before the house. It is referred to the Committee on Public Account, which does intensive scrutiny of the report, and a final report is prepared. This final report is submitted to the legislature and the reports are also published on the website of CAG. This procedure aids in maintaining transparency in the economy.

The viability of any fund can be ensured by its transparency. Both, PM CARES and PMNRF are audited by an independent auditor, and not by Comptroller and Auditor General. The rationale behind the same is that there are no budgetary allocations for these funds and it merely accepts voluntary donations from people.

CAG’s audit domain includes ‘aid/grant receiving unit of the government’. Though PM CARES is a public charitable trust and not a part of the government’s fund, but any reasonable citizen of the country would consider this to be a government fund, owing to the following acts-

  • The Press Information Bureau, which is the nodal agency of Government of India, has appealed to the public to contribute to PM CARES Fund. The document of appeal also mentions the fact that this fund has been created because “The Prime Minister’s office has been receiving spontaneous and innumerable requests for making generous donations to support the government in the wake of this emergency.”
  • Use of the name ‘Prime Minister’, which can only be used by the government according to the Emblem and Names Act of 1950.
  • Its mention on the official website of Prime Minister.

It can be implied from the aforementioned facts that this fund, coloured as a government fund, has been made in the form of trust only to get an exemption from an audit by CAG, through which it can escape public scrutiny.

The problem with an audit by an independent auditor is with its independence and transparency. The independent auditor of PM CARES will be appointed by trustees, posing threats on its independence, and on its transparency, as a consequence.

FOREIGN CONTRIBUTIONS

PM CARES accept foreign contributions as well. The aspect of foreign contributions is governed by the Foreign Contributions Regulation Act 2010.

Section 18 of the Act states that a person who has been granted a certificate under this Act shall intimate the Central Government, the amount of each foreign contribution received by it, source from which and the manner in which such foreign contribution was received, and the purposes for which, and the manner in which such foreign contribution was utilized by him.

PM CARES website says that it has received an exemption from all the provisions of FCRA 2010. Receiving an exemption would further lead to the sacrifice of transparency, as it will now not have to intimate the Central Government regarding the foreign contributions received.

In 2011, Central Government, through a gazette notification, stated that All bodies constituted or established by or under a Central Act or a State act and wholly owned by the Government requiring to have their accounts compulsorily audited by Comptroller & Auditor General of India are exempted from the operations of all the provisions of FCRA, 2010”.

But, PM CARES is not ‘compulsorily audited by CAG’, and hence it cannot receive such exemption.

CONCLUSION

Transparency is an essential feature of democratic governance in India. An example of a transparent fund is Chief Minister’s Disaster Relief Fund (CMDRF) in Kerala, which is operated by Finance Secretary and administered by the Revenue Department. RTI is applicable to CMDRF and funds are audited by CAG. So, in order to make PM CARES transparent, RTI should be applicable to it and should be audited by CAG.


ABOUT THE AUTHOR

Jaya Verma

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Jaya Verma is a third-year student from Maharashtra National Law University, Nagpur. Her areas of interest include Environmental Law and Human Rights Law.

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