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Notice (8): Undefined variable: urlPrefix [APP/Template/Layout/printlayout.ctp, line 8]latest-news-updates/public-funding-of-elections-1539.html"/> LATEST NEWS UPDATES | Public funding of elections | Im4change.org
Resource centre on India's rural distress
 
 

Public funding of elections


 
Democratic political systems in every advanced western country have faced challenges posed by the role of political finance or money spent during elections. On the basis of their specific experiences, these countries have tried to tackle the issue of political funding during polls.

The democratic political system is corrupted if elections are contested on the basis of financial resources provided by rich individuals or business corporations as these donors, from the powerful strata of society, expect returns from those elected representatives.

A natural quid pro quo develops between elected political representatives and their financial supporters because such obliged representatives are bound to return favours to their benefactors.

The Indian Constitution-makers were conscious of this fact that corruption-free and fair elections would not be possible without laying down constitutional and statutory provisions ‘for the independence and neutrality of the Election Commission’ responsible for the conduct of elections.

Elections to the Lok Sabha and the state assemblies were concretised in the various provisions of the representation of the people Acts of 1950 and 1951 and corrupt electoral practices were identified, and if an elected candidate was found guilty of electoral corrupt practices his election was set aside.

But it is a wellknown fact that legal and formal structures can only lay down a framework, while in practice laws are violated and illegalities practised by finding loopholes in the legal system. It has been happening in India from the very beginning of the electoral journey on the plea that ‘elections cannot be fought without money’ .

Political parties and candidates need money to organise election campaigns and, in large Lok Sabha and state assembly constituencies, electoral mobilisation cannot be undertaken without spending money for reaching the voters. This argument that democratic elections need money is unexceptionable and the Election Commission has fixed a limit on election expenses by individual candidates.

Again, this idea of fixing a ceiling on expenditure has not worked, and legally laid down requirements have been always violated both by political parties and the candidates. Former PM Indira Gandhi, in 1969, had imposed a ban on donations by private business companies to candidates or parties for elections. But that remedy was worse than the disease as the ‘ban’ was flouted by donors by secretly transferring funds for elections.

The ceiling on electoral expenses, as provided by section 77 of the representation of the people Act, was challenged in the Supreme Court and it made the ceiling more rigid by deciding that this law would stand violated by the candidate not only if he exceeded the expenditure but also if his political party did so.

Indira Gandhi amended section 77 of the RPA in 1975 and nullified the Supreme Court judgement by legalising expenditure on a candidate by his political party. Again, an amendment was made in 1985 which permitted a business company to contribute to parties for elections.

So, how does one protect MPs, MLAs and ministers from the stranglehold of powerful private investors in the democratic electoral process? If corruptionfree and fair elections are a pillar of democracy , the taxpayers should pay for elections because they have a real stake in corruption-free good governance.
 
A very important study, Money in Politics Handbook, mentions “an estimated 18 % countries, mostly developed nations, provide some form of tax relief for political donations” , to ensure that funds for elections are “open donations” .

Second , ‘government funds are transferred to parties ... which receive 5% of the votes cast or seats in the last election’ and if the government of India is serious, it should fund political parties through the public exchequer, especially those which have secured 10-15 % of the votes cast or seats.

Third, the audiovisual media has emerged in a big way and, with a full subsidy from the public exchequer, political parties should get free broadcast time for election campaigns. This practice is prevalent in many advanced democratic countries. Fourth, the government should provide subsidies in kind to serious political contenders , say, in the form of free electoral lists, free paper to publish party pamphlets , and free diesel and petrol for campaigning during the elections. In short, public funds and public subsidies are required to insulate political parties and their candidates from dependence on private operators for contesting an election.

It will be quite educative to describe the system of electoral funding in the US Presidential elections. While every democracy has a specific history of its own process of cleansing of electoral malpractices , the US has a rich experience as it had to fight a ‘battle against coercion and forced contribution’ from private companies for electoral purposes.

The US Federal Corrupt Practices Act of 1910 required disclosure of names of donors contributing over $100 for elections. Further, funding for elections in the US comes from individual citizens and public funds. Not only this. There is a strict legal limitation in the US on individual citizens’ contribution and public funding and a very comprehensive law exists for ‘disclosure requirement’ to ensure transparency in such contributions.

It is a well-known fact that opposition parties in every democracy have been actively engaged in asking for electoral reform because the donors always favour and invest in the ruling party and it leads to an unequal electoral competition.

The coalition system of government has made electoral reforms difficult because every group is in power at the Centre or in the sates, and all of them are involved in collecting funds from powerful private individuals.

The Dinesh Goswami report, as well as every chief election commissioner, has made recommendations for cleansing the electoral system. The Goswami report made important suggestions for ‘state funding of elections’ , but it is all gathering dust as every party or group has a vested interest in receiving money from private sources.

The Money in Politics Handbook clearly states that ‘one lesson from the US experience is that fighting corruption in political finance is a process of reform, evasion, identifying loopholes, and then more reforms ....’ Is anyone listening?