MoD clips fiscal powers of military officers

Vijay Mohan

Tribune News Service

Chandigarh, May 31

Introducing major changes in rules, the Ministry of Defence (MoD) has virtually stripped military officers of their discretionary financial powers across the board. While revising the powers from the level of Vice-Chief down to middle rung officers, the MoD has imposed additional checks and oversight mechanisms.

The new orders, circulated earlier this month, state that there would be no inherent financial powers in the new dispensation. Therefore, the Competent Financial Authority (CFA) at every level would be required to exercise the delegated powers in consultation with the Integrated Financial Adviser (IFA), a civilian officer from the defence Accounts Department posted to military establishments.

Another major change is the introduction of a collegiate-based mechanism, referred to as “procurement committee”, probably to speed up the procurement cycle. The committee will be formed by all CFAs within their domain and will deal with all stages of procurement from the preparation of the request for proposal to the final supply order.

Detailed schedules have also been drawn up for each service, listing the financial powers for different ranks under various heads and categories. The rules were last notified in 2006. “All procurement, works and non-procurement powers in schedules are required to be exercised with concurrence of the IFA concerned,” the orders state.

The new orders also provide that at any stage of procurement, the CFA can overrule the advice of the IFA by a written order giving reasons for the same. There are also provisions for making emergency purchases or executing some specific works without prior approvals from the IFA. Pointing out that decentralisation of decision-making was one of the key components of good governance in large and complex organisations like defence, the MoD has contended that any effective system of delegation needed to necessarily have an appropriate oversight mechanism as an integral element of the ecosystem based upon the principle of reasonable assurance to the executive at the highest level.