On October 4, the Election Commission of India (ECI) came down heavily on political parties over freebie culture. In a letter written to the officials of political parties, ECI not only criticised the political parties for offering freebies without explanation over how they would fulfil them but also proposed a proforma to fill where the parties have been asked to explain the roadmap which they would use to raise funds for the freebies offered in the manifesto.
Termed as ‘standardised disclosure proforma’, it contains sections that political parties will have to fill to explain the financial implications of the promises made and provide possible ways to fulfil them. The ECI has asked the political parties and candidates to reply with their views by October 19. In case no reply is received, ECI will assume that the parties or candidates do not have anything specific to say on the proposed amendments in the Model Code of Conduct (MCC).
In its letter, ECI said that it is the right of eligible voters to exercise their vote with ease and have authentic and adequate information at each electoral stage. ECI said, “The choice to cast the vote, i.e. the most precious gift of democracy is directly and intricately linked to access to timely and reliable information. It is in this background that timely availability of data points to assess the financial viability of the promises made to voters in the election manifestos assumes criticality.”
Furthermore, ECI said that though it recognises the right of the political parties to make promises in the manifesto, “it cannot overlook the undesirable impact of some of the promises and offers on the conduct of free and fair elections and maintaining a level playing field for all political parties and candidates”.
Based on the directions given by the Supreme Court in the Subramaniam Balaji Case and Article 324 of the Constitution that mandates the Election Commission to conduct elections inter alia to the Parliament and the State Legislatures, the ECI has issued guidelines via amendment in MCC in 2015. for the Political Parties and Candidates to adhere while releasing the election manifesto. These guidelines talk about the promises that political parties make in their manifesto.
Notably, the guidelines direct the political parties and candidates to “avoid making those promises which are likely to vitiate the purity of the election process or exert undue influence on the voters in exercising their franchise.” Further, it also directed the parties and candidates to “reflect the rationale for the promises and broadly indicate the ways and means to meet the financial requirements for it.”
However, despite these guidelines in place, ECI found that the declarations made by the political parties and candidates do not provide adequate information to the voters. The ECI said, “The Commission notes that the consequences of inadequate disclosures by political parties get attenuated by the fact that elections are held frequently, providing opportunities for political parties to indulge in competitive electoral promises, particularly in multi-phase elections, without having to spell out their financial implications more particularly on committed expenditure. These declarations are also not submitted by most of the political parties in time.”
The ECI further proposed that the parties should disclose the financial implications of the promises in terms of the “financial resources required and the ways of financing them on the one hand and the effect thereof on the fiscal sustainability of the State’s or the Central Government’s finances, as the case may be”. The ECI added, “Given that the major objective of the disclosures is to facilitate informed choices, greater importance has been given to simplicity.”
The commission proposed to prescribe a proforma for the recognised National and State Political Parties to provide details of the financial implications of promises made in the election manifesto and the ways and means to finance them. ECI said, “To make the disclosures more meaningful, the proforma provides for certain fiscal information being prefilled by the respective State/Central Government.”
SBI warned against freebies
In a recent report, the State Bank of India warned against the increasing trends of offering freebies during elections. In the report penned by Soumya Kanti Ghosh, the group chief economic advisor for the State Bank of India, three poor states were cited as examples that were Rajasthan, Chhattisgarh and Jharkhand, in terms of pension liabilities that tune to three lakh crores. The report suggested that the pension liabilities of these states were quite high at 217, 190 and 207 per cent, respectively.
Coming to the loans raised by state-owned entities and guaranteed by the states, the report noted that based on the latest information, the off-budget borrowing of the states had reached 4.5% of the GDP. It further noted that the extent of freebies or welfare schemes had achieved a major portion of GDP in many states.
As per the report, financial assistance or cash transfers, utility subsidies, loan or fee waivers and interest-free loans announced by the states in their latest budgets, the estimated expenditure on freebies range from 0.1 per cent to 2.7 per cent of GSDP of several states. In the case of Punjab and Andhra Pradesh, which are under high dept, the freebies have exceeded over 2 per cent of the GSDP.
