This committee was created in 1964 on the recommendation of the Krishna Menon Committee. Originally, it had 15 members (10 from the Lok Sabha and 5 from the Rajya Sabha). However, in 1974, its membership was raised to 22 (15 from the Lok Sabha and 7 from the Rajya Sabha). The members are elected by the Parliament every year from amongst its members according to the principle of proportional representation by means of a single transferable vote. Thus, all parties get due representation in it. The term of office of the members is one year. A minister cannot be elected as a member of the committee. The chairman of the committee is appointed by the Speaker from amongst its members who are drawn from the Lok Sabha only. Thus, the members of the committee who are from the Rajya Sabha cannot be appointed as the chairman.
The functions of the committee are:
- To examine the reports and accounts of public undertakings.
- To examine the reports of the comptroller and auditor general on public undertakings.
- To examine whether the affairs of the public undertakings are being managed in accordance with sound business principles and prudent commercial practices.
- To exercise such other functions vested in the public accounts committee and the estimates committee in relation to public undertakings which are allotted to it by the Speaker from time to time.