Indian Defence Minister, Rajnath Singh, has called for a foolproof system of internal and external audit for defence expenditure to maximise the value of money spent on India’s security needs. In an address at a conference, he underlined the importance of a robust defence finance system for a strong military and highlighted the need for comprehensive ‘Blue Books’, codifying the rules and procedures for procurement of military equipment and systems. Singh said the government has formulated ‘Blue Books’ in the form of Defence Acquisition Procedure 2020 for capital acquisition and Defence Procurement Manual for revenue procurement besides delegating financial powers to the services.
The Defence Minister’s statement highlights the importance of efficient financial management in the armed forces. By having a sound system of accounting, clearing of bills and payments, salary and pension disbursal, the armed forces personnel can focus more on their primary responsibilities and duties. This would also result in better productivity, as well as an improvement in the overall morale of the armed forces.
Moreover, the separation of functions of defence finance from the core defence organisations can have multiple advantages. This could lead to greater accountability and transparency in financial management, as well as reduce the burden of non-core activities on the armed forces. It can also lead to cost savings, as specialised financial institutions can manage financial matters more efficiently and effectively. Additionally, this can ensure better compliance with financial regulations and improve the overall financial health of the defence organisation.
