Audit flags, Government assures, action falters
Moa Jamir
Nagaland’s latest CAG reports have once again put the spotlight on a familiar question: when financial irregularities, implementation failures and long-pending cases are repeatedly flagged, what actually follows? Two reports tabled in the Nagaland Legislative Assembly on September 3: the State Finances Audit Report for 2024-25 and the report on the Social, Economic, General and Revenue Sectors, including Local Governments Audit, for the year ended March 31, 2024—together expose a wide range of concerns across the State’s finances, departments and development programmes..
Read together, they raise a question beyond individual audit observations: what happens after the CAG finds a problem?
The State Finances report recorded 30 cases of misappropriation, defalcation, loss and theft involving Rs 1,214.37 crore pending as of March 31, 2025. Twenty-five cases involving Rs 1,187.88 crore were awaiting departmental and criminal investigation, while five cases worth Rs 26.49 crore were pending in courts. Ten had remained unresolved for more than five years. The CAG called for expediting proceedings.
The report also found 210 utilisation certificates involving Rs 365.25 crore pending, including Rs 121.72 crore dating from before 2019-20. Despite Government assurances that the backlog would be reduced, the CAG noted that details of the proposed steps were not provided.
Then there are the development schemes and systems themselves. The companion report covered performance audits of the Jal Jeevan Mission, Integrated Child Development Services (ICDS), MGNREGA, and the functioning of Regional Transport Offices/District Transport Offices, besides an Information Technology audit of Treasury Computerisation and 10 compliance audit paragraphs, including a subject-specific audit of departmental oversight of GST payments and return filing. Across these areas, the CAG flagged numerous anomalies and deficiencies in implementation, expenditure, record-keeping and oversight.
For instance, under JJM, Rs 21.57 crore relating to 5,851 purported household tap connections was termed fictitious expenditure, while under MGNREGA, 24 government employees were found enrolled as unskilled workers, with Rs 6.04 lakh paid as wages to 19 of them in the test-checked villages.
An audit observation is not, by itself, a finding of guilt. CAG reports identify irregularities and deficiencies requiring explanation, recovery, corrective action or further investigation. Government responses are part of that process. The concern is therefore the follow-through.
The latest State Finances report noted that Action Taken Notes on PAC recommendations relating to the 2017-18 to 2021-22 reports were still awaited as of December 2025, despite prescribed timelines. Repeated assurances on pending UCs and AC bills have similarly not always been accompanied by details of concrete follow-up.
The accountability question also extends beyond Government and the Legislature. Nagaland has an active civil society, but sustained scrutiny of public expenditure and CAG findings appears comparatively limited. At the XXIII Morung Lecture, a retired public servant spoke on the effects of nepotism and favouritism, while a serving CAG official pointed to weak public pressure and the normalisation of such practices as factors affecting deterrence.
This is not to suggest that every audit observation requires public mobilisation, or that civil society is uniformly silent. But where findings involving hundreds or thousands of crores remain unresolved for years, sustained public scrutiny could strengthen accountability.
The latest Lokayukta figures show that consequences do occur: 31 cases disposed of, 34 persons penalised, 240 persons terminated from service and Rs 1.22 crore recovered. But these figures should be viewed in proportion to the scale of the concerns. Recovery of Rs 1.22 crore remains small against the financial irregularities reflected in the CAG reports, including the Rs 1,214.37 crore in 30 pending cases.
The larger issue is therefore the gap between detection, action and deterrence. When observations recur, old cases remain pending, utilisation certificates accumulate and public scrutiny is intermittent, the risk is that irregularities become part of the administrative landscape rather than triggers for timely correction.
The question is not simply what the CAG has found, but what has happened after it was found and why sustained public demand for answers remains limited when such large amounts of public money are involved.
For any feedback, drop a line to jamir.moa@gmail.com
