The control of Public Administration is one of the most important topics within Administrative Law, and, since the 1988 Federal Constitution, it has experienced expansion. According to some doctrinal currents, the overreach of certain institutions serves to limit the discretion of Public Administration, often functioning merely as a veto power over specific public policies.
As is well known, in short, control can be internal or external, through economic, social, and even judicial analyses. Currently, some institutions, such as the Public Prosecutor's Office and the Federal Court of Accounts, have been remodeled, gaining new competencies seeking to implement and solidify external control of the administration, as Professors Floriano de Azevedo Marques Neto and Juliana Bonacorsi de Palma have very well discussed. It is important to remember that, in reality, efficient control of Public Administration is not that which frightens the manager, but rather, the truth is that good control is measured by its concrete effects, as Professor Juliana de Palma states.
As part of the (internal or external) control of Public Administration, there is the control of its public policies. Article 70 of the Constitution allows, to some extent, the TCU (Federal Court of Accounts) to carry out this control based not only on accounting and financial aspects, but also on operational ones. Furthermore, the oversight is not based solely on the legality or legitimacy of the acts, but also takes into account the cost-effectiveness of the processes.
Thus, the TCU, in a rather broad (and sometimes questionable) interpretation of Article 70 of the Federal Constitution, can carry out various types of audits: accounting, financial, budgetary, operational, and asset audits (Article 71, IV, CF88) with the aim of overseeing not only the accounts but also the public policies themselves. In this way, the TCU ends up becoming a potential evaluator of public policies, even though this is not part of its constitutional duties.
The Role of the Federal Court of Accounts in Overseeing Public Administration
External control of public administration is an easy and seductive topic in Brazil. With an epidemic of corruption cases, misuse of public resources, acts of strictly personal interest, and abysmal social inequality, only reinforced by some public policies, it is natural that the population is captivated by promises of solving these problems. Just citing Brazil's recent past, Collor said he would "hunt down the bigwigs," Bolsonaro claimed that the "gravy train would end," among other cases. These promises won over the public opinion of significant segments of the Brazilian population.
Indeed, Brazil lacks initiatives that can curb improper acts by public authorities. In this context, obviously, oversight bodies, both external and internal, are important parts of Brazil's democratic rule of law. Especially after the 1988 Constitution, it is impossible to think of Brazil without bodies such as the Public Prosecutor's Office, the Federal Police, the Federal Court of Accounts, or the Comptroller General of the Union (and their related institutions, such as the Ministry of Transparency).
Turning to external control, the subject of this essay, it is important to highlight that this control is carried out by a body external to the Administration responsible for the controlled act, whether it be the Legislative Branch with the assistance of the Courts of Auditors, or judicial control itself (or even by the Public Prosecutor's Office), or the control of administrative acts by the Legislative Branch itself.
In the words of Floriano de Azevedo Marques Neto, control has four primary objectives:
(i) the first is the defense of public assets, since the State is the owner of these assets and has a duty to defend its property;
(ii) the second deals with the application of public resources, verifying not only budgetary management, but also civil liability, economy and probity;
(iii) the third objective of control is the fulfillment of the purposes of the Administration, trying to achieve ever greater administrative efficiency;
(iv) Finally, the fourth objective of control is to keep administrative acts within the bounds of legality, considering the law as the basis for administrative action.
In this context, it is important to bring the issue of controls into the present day. As pointed out by Professor Maria Sylvia Zanella di Pietro, external control has been considerably expanded in the current Constitution, as can be seen in its article 71. Its attributions are diverse, such as: (i) financial oversight proper; (ii) consultation – especially in relation to the prior opinion on the accounts of the President of the Republic; (iii) information; (iv) judgment; (v) sanctioning attributions; (vi) corrective attributions; and also vii) attributions similar to an ombudsman.
In this scenario, it becomes evident that the greatest challenge for making complex decisions stems not only from the difficulty and need for speed in decision-making, but also from the existing mechanisms for controlling Public Administration. While the 1988 Constitution brought democracy to the country, imposing control mechanisms on the Administration, increasing the transparency of actions, providing instruments for popular participation, and even greatly facilitating legal action against public authorities, it can also lead to an excess of power, without checks or balances.
Types of audits performed by the TCU (Brazilian Federal Court of Accounts)
Given that the Federal Court of Accounts (TCU) is currently the main external control body, it is necessary to understand its functioning in terms of its actions. As already mentioned, the TCU uses several mechanisms to carry out its control work. These include follow-ups, surveys, monitoring, inspections, and audits. It should also be noted that inspection differs from auditing, as it is not an autonomous oversight instrument, whereas auditing can function independently. Audits are divided, according to the TCU itself, into: (i) operational; (ii) compliance; and (iii) financial.
According to the TCU's (Brazilian Federal Court of Accounts) operational audit manual, it follows international standards and is an independent, objective, and reliable examination that analyzes whether government projects, systems, operations, programs, activities, or organizations are functioning in accordance with the principles of economy, efficiency, effectiveness, and efficacy, and whether there is room for improvement. This is the subject of this analysis, since this type of audit is essential to ensure the compliance of administrative acts with legal provisions and with the efficiency and transparency criteria required by the TCU.
Compliance auditing, in turn, according to the TCU (Brazilian Federal Court of Accounts), aims to examine the legality and legitimacy of management acts in light of the normative standards defined in applicable technical, legal, and regulatory norms – as well as the clauses of contracts, agreements, accords, adjustments, and similar instruments. Finally, the TCU classifies financial auditing as an oversight instrument that independently verifies the reliability of financial statements disclosed by public bodies and entities, in defense of the principles of transparency and accountability.
Can operational audits evaluate public policies?
This short essay seeks to understand to what extent operational audits address the evaluation of public policies in a broad sense. Therefore, before making a value judgment about this possibility, it is important to highlight how the TCU (Brazilian Federal Court of Accounts) views the dimensions of performance in an operational audit. To do so, it is necessary to reiterate the definitions given by the Court of Accounts itself in its Operational Audit Manual.
There is a conceptualization of needs, objectives, inputs, activities, results, impacts, products, and the effect of government intervention. In short, these terms relate to the public policy cycle, especially the evaluation stage, as discussed in a recent article in this forum, dealing with the evaluation of public policies for industrial innovation.
It should be noted that, in this sense, the TCU (Brazilian Federal Court of Accounts), through its operational audits, effectively evaluates concepts that are not always strictly objective, such as the legality of acts or the use of resources in accordance with current legislation. Operational audits, according to their own manual, can assess economy, efficiency, effectiveness, equity, and other dimensions of public policy performance (or specific government action).
It is noticeable that some of these concepts evidently result in subjective analyses to some extent. The manual itself asserts that efficiency – by way of example – is a relative concept (item 1.3.2, page 17), requiring a comparison to demonstrate efficiency or its absence. Now, when dealing with the external control of Public Administration, relativizing concepts, or making them subjective, can be extremely dangerous for the balance of power. It is always important to reiterate that the TCU (Brazilian Federal Court of Accounts) is, in the end, an auxiliary body of the Legislative branch.
However, operational audits should not be vilified. If conducted impartially, seeking the best public interest, they are essential for the proper functioning of the administrative machinery. Their manual takes into account international best practices in auditing, and, if followed properly, will help the Public Administration achieve its objectives. Currently, the work of evaluating public policies is fragmented, without standardization for its analysis. With operational audits, the TCU (Brazilian Federal Court of Accounts) can, perhaps, offer a path for the Brazilian State to achieve such results.
FINAL CONSIDERATIONS
As discussed in this text, external control of Public Administration is a sine qua non for the full development of the country. Evidently, external control must, to some extent, include the control of implemented public policies. However, it is incumbent upon the established powers to ensure sufficient checks and balances not only between the Three Branches of Government, but also between oversight bodies, such as the Public Prosecutor's Office and the Courts of Accounts throughout Brazil. In this sense, one must never lose sight of Professor Marcos Augusto Perez's assertion: without checks and balances, and with a series of excessively generic and imprecise prerogatives, one does not need to look far to imagine that these oversight bodies tend towards the daily abuse of power.
That being said, it is clear that operational audits have been performing important work in evaluating public policies, especially considering that their main guide – the TCU's (Brazilian Federal Court of Accounts) Operational Audit Manual – draws on important and consistent international practices. However, it is impossible to ignore the fact that such audits, when evaluating public policies with subjective measures on some occasions, can generate an imbalance of power. The TCU, having had its competencies expanded, can now sanction the Public Administration in various ways. Doing so based on an operational audit that uses subjective criteria to evaluate a public policy seems dangerous from an institutional perspective. It is therefore up to Brazilian institutions to establish limits so that these actions are as correct and republican as possible.
REFERENCES
[1] MARQUES NETO, Floriano; PALMA, Juliana Bonacorsi de. The seven impasses of Public Administration in Brazil. In PEREZ, Marcos Augusto and SOUZA, Rodrigo Pagani de (eds.). Control of Public Administration. Belo Horizonte: Fórum, 2017.
[2] DE PALMA, Juliana Bonacorsi de. (2017) Is the measure of control of Public Administration overly or under-controlled? In: André Rosilho. (Org.). Administrative Law and Control of Accounts. Belo Horizonte: Fórum, 2023.
[3] MARQUES NETO, Floriano de Azevedo. The great challenges of controlling Public Administration. Public Procurement and Management Forum. FCGP Belo Horizonte, year 9, no. 100, Apr. 2010.
[4] DI PIETRO, Maria Sylvia Zanella. Manual of Administrative Law. São Paulo: Atlas, 2020
[5] BRAZIL – FEDERAL COURT OF ACCOUNTS. Operational Audit Manual / Federal Court of Accounts. — 4th ed. – Brasília: TCU, General Secretariat for External Control (Segecex), 2020. https://apoioauditoria.tcu.gov.br//wp-content/uploads/sites/17/2024/12/MANUAL-DE-AUDITORIA_editorado_final.pdf
[6] BRAZIL – FEDERAL COURT OF ACCOUNTS. Bulletin of the Federal Court of Accounts – v. 1, n. 1 (1968) – . – Brasília : TCU, 1968- . v. Weekly. Continuation of: Internal Bulletin of the Federal Court of Accounts.
[7] BRAZIL – FEDERAL COURT OF ACCOUNTS. Financial Audit Manual – 2016 / Federal Court of Accounts. – Brasília: TCU, Secretariat of Methods and Support for External Control (SEMEC), 2016. https://apoioauditoria.tcu.gov.br//wp-content/uploads/sites/17/2024/12/Manual-de-Auditoria-Financeira_Edi__o-2016_vFinal_WEB-6-.pdf
[8] BRAZIL – FEDERAL COURT OF ACCOUNTS. Operational Audit Manual / Federal Court of Accounts. — 4th ed. – Brasília: TCU, General Secretariat for External Control (Segecex), 2020. https://apoioauditoria.tcu.gov.br//wp-content/uploads/sites/17/2024/12/MANUAL-DE-AUDITORIA_editorado_final.pdf
[9] PEREZ, Marcos Augusto. “The World that Hely did not see: democratic governance and fragmentation of Administrative Law. Dialogue between Hely's systemic theory and current paradigms of Administrative Law”. In Administrative Law Today: Studies in Honor of the centenary of Hely Lopes Meirelles (Org. WALD, Arnoldo; JUSTEN FILHO, Marçal and PEREIRA, César Augusto de Guimarães). São Paulo: Malheiros, 2017, pp. 851-869.
