On paper, the AGN is a powerful organization inserted into a coherent framework for financial governance and fiscal control, with clearly delineated responsibilities.14 Admittedly, Argentina has made significant advances in rationalizing public budgeting and financial administration. However, there exist important dysfunctions that severely limit the AGN’s effectiveness and adversely affect government accountability.
The AGN emerged in 1992 as part of sweeping reforms of public budgeting and the adoption of a new financial administration law. However, despite being provided for in the Constitution, the AGN still lacks an organic law cementing its internal governance and procedural rules. It acquired constitutional status in 1994 as a legislative body. Responsibility for the oversight of government finances ultimately rests with the legislature, assisted by the AGN. Legislative budget oversight is exercised through the joint audit and public accounts committee of the bicameral legislature (the Comisión Parlamentaria Mixta Revisadora de Cuentas, CPMRC), which is integrated by 12 members (six senators and six deputies), designated on a proportional basis for the duration of the legislature and presided over by a representative of the majority.
The AGN is an autarkic institution with legal persona, functional independence and financial autonomy. Its structure, functions and internal procedures are approved by the legislature by joint resolution of the budget and finance committees of each chamber and the CPMRC (Rodríguez and Bonvecchi 2006). The CPMRC oversees the AGN and is its main institutional anchor in the legislature. The AGN is a collegial organization with collective decision-making structures. It is governed by a college of seven auditors-general designated for an eight-year, renewable term. The Senate and the Chamber of Deputies designate three auditors each on a proportional basis.
The seventh auditor-general, the president of the college, is designated by a joint resolution of both chambers and, since 1994, by the main opposition party.15 However, this does not necessarily mean that the majority of the college of auditors belongs to the opposition; quite to the contrary, in fact, and the president of the college of auditors has usually been in the minority. Since decisions are taken either by consensus or majority vote, the representatives of the legislative majority can veto adverse audit rulings. This institutional set-up therefore allows the ruling party to neutralize any initiative that could damage or embarrass the executive. Furthermore, the ruling party can also delay, dilute or veto adverse audit rulings in the legislature and the CPMRC, which it usually dominates.
The AGN has a broad mandate, extending its jurisdiction over the economic, financial, legal and patrimonial management of the federal government, including programs financed by international financial institutions, debt financing and social spending (AGN 1993). The purpose of external auditing is clearly corrective, rather than punitive, being carried out ex-post and being non- binding in nature. External auditing includes both performance and compliance auditing. Ex-ante compliance control was abandoned in 1992 and was devolved to the internal control system, which was also restructured under the supervision of a central internal audit agency, the Sindicatura General de la Nación (SIGEN), placed under the authority of the President. The AGN does not possess direct enforcement and sanctioning powers and, therefore, enforcement is indirect through the referral of cases to the competent authorities.
14 The legal framework of the AGN is provided by the 1853 Constitution revised in 1994 (article 85) and the 1992 financial administration and fiscal control law (Law 24156), which replaced the antiquated 1956 accounting law (Law 23354). The 1992 financial administration law, the 1997 organic budget law (Law 11672) and the annual budget laws regulate the budgetary system.
15 The current institutional arrangements are the result of the 1994 amendment to the Constitution, which sought to strengthen external oversight of government. The 1993 Pacto de los Olivos between the ruling Peronist party and the opposition Radical party agreed to the principle of presidential re-election sought by President Carlos Menem in exchange for greater control over the executive and reduced concentration of powers in the presidency.