Should elections be state-funded?

It is based on the presumption that there would be no private funding. This is antithetical to democracy

State funding of elections is that apparition that cannot fructify but refuses to fade away. Indian political parties, unlike western democracies, are not mere platforms to put some people into elective public office but are like standing armies that need continuous nourishment. They provide a calling card to millions who otherwise may not have a worthwhile identity or independent standing in the social and economic milieu — the syndrome of whole-timers, pracharaks and party apparatchiks, respectively.

Thus there are two aspects to the financing of the democratic process: the financing of elections from the panchayat level to Parliament, and the funding of political parties that is not election-specific but is an exercise in perpetuity for reasons enunciated above.

Disclosing sources

Candidates for various levels of elections are funded by myriad sources: friends, individuals who believe in the cause or ideology a candidate/ political party espouses, non-governmental organisations, corporates, NRIs, foreign governments and even criminal syndicates seeking patronage and protection. Any substantive initiative aimed at bringing transparency, accountability and cleanliness to the vexed question of political financing needs to address these aspects concurrently.

Under the existing legal dispensation, election candidates are obligated only to reveal their spending and keep it theoretically within limits prescribed by the Election Commission, a ceiling routinely violated with impunity by every candidate in every election. They are under no obligation to disclose how much money they have collected and where it has come from. This needs to change. All candidates must reveal the sources of their electoral funding statutorily. In addition to the expense statement, a daily collection statement detailing the identity of the donors with their PAN card, Aadhaar card number, and full financial details must be filed with the expenditure observer overseeing every election.

Insofar as political parties are concerned, the Supreme Court must take suo motu cognisance of the recent Association of Democratic Reforms report that documented that 69% of the income of political parties between 2004-05 and 2014-15 came from unknown sources. This is happening because of a deliberately inserted exemption: Section 13 (A) subsection (b) of the Income Tax Act, 1961 that exempts political parties from even keeping a record of the source of donations below Rs. 20,000. Read in conjunction with Section 29 (C) of the Representation of the People Act 1951, it provides the legal architecture and immunity for the opacity manifest in political and electoral financing processes. It is a bit of chicanery if not insidiousness that it was a previous National Democratic Alliance government that in 2003 had raised the limit of anonymous donations from Rs. 10,000 to Rs. 20,000, and now the Finance Minister says in his Budget speech that it would be brought down to Rs. 2,000. This is nothing but a mere eyewash since the law mandates that no records of donations below this threshold need to be maintained. Therefore, any and every political party will now claim that a substantive bulk of their donations has come from donors who have contributed Rs. 2,000 or less.

This exemption needs to be quashed by the Supreme Court because Parliament will never legislate to remove this insidious loophole. Collective vested interests would ensure its continuity. The identity of every donor to every political party irrespective of the amount donated must be in the public domain so that the Election Commission, Income Tax Department and other electoral oversight initiatives can verify their bona fides. These and a myriad other reforms are the way forward.

Conceptually, state funding of elections is based on the presumption that there would be then no private funding. The Election Commission simply does not have the wherewithal to ensure that. Moreover, elections are a democratic participatory process. If as an elector you are passionate about a candidate/ political party, isn’t it logical to put your money where your heart or mouth is? State funding of elections is therefore antithetical to democracy itself.

Recommended for you