Recently, the Public Accounts Committee (PAC) has taken suo-moto initiative to review the performance of regulatory bodies such as Securities and Exchange Board of India (SEBI) and Telecom Regulatory Authority of India (TRAI). 

Why has the PAC Initiated the Review of Regulatory Bodies? 

• The review aims to enhance the effective use of public funds and improve governmental oversight. 
• The decision was made amid a political controversy over allegations of conflict of interest against the SEBI chief. 
• The panel has chosen 5 subjects for suo-motu investigations, including "performance review of regulatory bodies established by Act of Parliament" and "levy and regulation of fees, tariffs, user charges etc. on public infrastructure and other public utilities". 

Public Accounts Committee (PAC)

• • None of the members of the CAG committee can hold positions as government ministers. 
  • The PAC is a committee of selected members of Parliament, constituted by the Parliament of India, for the purpose of auditing the revenue and the expenditure of the Government of India. 
  • Parliamentary committees draw their authority from Article 105 and Article 118 of the Constitution. PAC is one of the three Financial Parliamentary committees, the other two are the Estimates Committee and the Committee on Public Undertakings. 
• Background: 
  • It is constituted every year under Rule 308 of the Rules of Procedure and Conduct of Business in Lok Sabha. 
  • The PAC was introduced in 1921 after its first mention in the Government of India Act, 1919 also called Montford Reforms. 
• Composition: It presently comprises 22 members (15 members elected by the Lok Sabha Speaker, and 7 members elected by the Rajya Sabha Chairman) with a term of 1 year only. 
  • The Chairman of the Committee is appointed by the Speaker of Lok Sabha. 
• Powers and Functions: 
  • The CAG assists the committee during the investigation. 
  • Examine accounts showing the appropriation of funds granted by the House for expenditure and the annual Finance Accounts of the government. 
  • Review other accounts presented to the House that the Committee deems appropriate, except those related to Public Undertakings assigned to the Committee on Public Undertakings. 
  • Committee reviews various CAG Audit Reports on revenue receipts, government expenditure by different Ministries/Departments, and accounts of autonomous bodies. 
• Recommendations: 
  • The PAC''s recommendations are advisory and not binding on the government, as it is an executive body that cannot issue orders, and only Parliament can take a final decision on the committee''s findings. 

Regulatory Bodies in India

These agencies may operate with or without direct executive supervision. Regulatory bodies are independent government entities established to set and enforce standards in specific fields of activity or operations.  

• Functions: 
  • Creating regulations and guidelines 
  • Reviewing and assessing activities 
  • Issuing licences 
  • Conducting inspections 
  • Implementing corrective actions 
  • Enforcing standards 
• Examples:  
  • Established: 1992 
  • Headquarters: Mumbai 
  • Role: Regulates securities markets, protects investors, and ensures market integrity. 
  • Structure: Board with Chairman, whole-time, and part-time members. Appeals handled by Securities Appellate Tribunal (SAT), with further appeals to the Supreme Court. 
  • Functions: Drafts regulations, conducts inquiries, imposes penalties. Overseas venture capital funds, mutual funds, and addresses fraudulent practices. 
  • Established: 1997 
  • Headquarters: New Delhi 
  • Role: Regulates telecom services, revises tariffs, ensures service quality, and advises the government on telecom policy. 
  • Structure: Chairperson, up to two whole-time and two part-time members. 
  • Appellate Authority: Telecommunications Dispute Settlement and Appellate Tribunal (TDSAT), established in 2000, handles disputes and appeals from TRAI’s decisions. 
  • Securities and Exchange Board of India (SEBI) 
  •  Telecom Regulatory Authority of India (TRAI) 
  • Other Regulatory Bodies: Reserve Bank of India (RBI), National Bank for Agriculture and Rural Development (NABARD), Small Industries Development Bank of India (SIDBI), Food Safety and Standards Authority of India (FSSAI), Central Drugs Standard Control Organisation (CDSCO), and Competition Commission of India (CCI).