Appointing regulators

Why not involve the Opposition as a matter of course?

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It was almost inevitable in this climate of scandal and corruption that the new Comptroller and Auditor General (CAG) of India, Shashi Kant Sharma, assumed office to the accompaniment of a public interest writ petition in the Supreme Court challenging his appointment. The burden of the petition is that Mr Sharma was in the defence ministry for 10 years and responsible for overseeing many of the arms deals that are now under investigation for irregularities. The petition suggests that his appointment is "mala fide" because as CAG Mr Sharma will be scrutinising deals in which he was involved as a government bureaucrat. His objectivity will then be in question. Even after assuming high standards of rectitude for Mr Sharma - and there is no reason not to - the petitioner's point is worth considering. It is, of course, not easy to assume that any senior bureaucrat exists who would as CAG never be called upon to supervise an investigation of a ministry in which he once held a position. But these questions would be less powerful if the manner of the CAG's appointment was less opaque.

As the petitioner argues, "none of the parliamentarians/political parties were consulted". True, this has never been the convention. But the demands on regulators and the risks of regulatory capture have only increased with time. In that sense, it would be a healthy practice to adopt a more transparent appointment process for not just constitutional positions like the CAG but all sectoral regulators - telecom, electricity, stock markets, banking and so on. True, regulators, whether constitutional or created by Acts of Parliament, are supposed to be autonomous by definition. But that has often proven a theoretical construct, not least because these bodies tend to be headed by retired bureaucrats as a matter of course. The Election Commission, the earliest of independent India's regulators, remains a notable exception perhaps because it carved out a genuine autonomy from the start.

Luckily, a healthy precedent exists in the appointment of the Chief Vigilance Commissioner, which involves a committee comprising the prime minister, home minister and leader of the Opposition in the Lok Sabha. The checks and balances of this system can be seen in the controversy and subsequent removal of P J Thomas as Chief Vigilance Commissioner. When controversy arose over Mr Thomas' role in edible oil imports as food secretary in Kerala, his removal via a reference to the Supreme Court was made easy when Opposition leader Sushma Swaraj revealed that she had brought this issue to the prime minister's notice. Involving Opposition leaders in appointing key regulators would also be a healthy practice in India's parliamentary democracy, where parties outside the regime routinely feel alienated. One additional means of controversy-proofing regulatory authorities would be to introduce a cooling-off period that bars regulators from holding offices of profit in government or the private sector for a set period - say, five years. The doubt, of course, is whether any ruling party would be ready to eschew such powers.