Views | The next target: Election funding

Views | The next target: Election funding
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First Published: Wed, Dec 28 2011. 12 55 PM IST

Updated: Wed, Dec 28 2011. 12 55 PM IST
The Lokpal law has cleared was cleared by the Lok Sabha on Tuesday and was due to be debated upon in the Rajya Sabha on Wednesday. Meanwhile, the anti-graft agitators have moved to Mumbai where they have come across an insipid public response as well as concerns about Anna Hazare’s health.
One major fount on corruption in India has been relatively ignored by the Hazare movement is the funding of political parties. An earlier generation of activists had made such electoral reforms a core issue in their campaigns.
The National Commission to Review the Working of the Constitution (NCRWC), set up by the National Democratic Alliance government in 2000, had pointed out that the compulsions of funding expensive election campaigns has become the foundation of the super structure of corruption in India. It highlighted the fact that campaign spending by candidates is in the range of about twenty to thirty times the legal limits, and that political parties source a major chunk of their funds from unidentified donors, mainly business groups that expect a high return on investment through kickbacks, commissions or favourable policies.
The income tax returns data collected by Association for Democratic Reforms (ADR) under the RTI Act shows that the Congress reported a total income of Rs496.88 crore, expenditure of Rs274.75 crore and a net surplus of Rs222.13 crore in fiscal 2009. That was the year in which most of the funds for the 2009 Lok Sabha election were collected and deployed.
The Bharatiya Janata Party had a total income of Rs220.02 crore in the same year.
Anecdotal evidence suggests that far more is needed to run a nationwide election campaign. One well-known bit of informal evidence from the money supply data released every fortnight by the Reserve Bank of India is that spurt in the cash held by Indians as elections approach.
Congress collected at least Rs978 crore through sale of coupons in the five years till 2008-09,of which contributions collected with donor’s name account for a mere Rs85 crore.
Meanwhile, companies do not disclose too much about their campaign funding commitments, despite the fact that they are permitted to pay 5% of average profit as political donations as per Companies Act of 1956.
The Representation of People Act states that political parties are required to submit details of contributions received in excess of Rs20,000 from any person or a company. Political parties might be misusing this act by taking multiple donations from the same source while keeping each contribution within the limit of Rs20,000 so that they don’t have to disclose donors’ names.
Writing in 1970, Jayaprakash Narayan had stated: “Election has become very expensive and is day by day becoming more so. This has constantly been pointed out but nothing has been done about it. Many years ago … Rajendra Prasad drew the attention of Pandit Jawaharlal Nehru to this fact. Immoral practices in elections are also on the increase.”
The cost of elections has gone up manifold since then, and hence the demand for money by the political class. The need of the hour is to bring about transparency in political funding.
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First Published: Wed, Dec 28 2011. 12 55 PM IST