Unlike national parties that declare close to 70% of their income as coming from unknown sources, only 20% of the income recorded by regional parties was from unknown sources. Photo: Priyanka Parashar/Mint
Unlike national parties that declare close to 70% of their income as coming from unknown sources, only 20% of the income recorded by regional parties was from unknown sources. Photo: Priyanka Parashar/Mint

Regional parties continue to spend more money than their claimed income: report

Southern regional political parties like DMK, AIADMK and TDP were the richest, with the three accounting for over 60% of the total reported income, says Association for Democratic Reforms report

Out of 47 major regional parties analysed by election watchdog Association for Democratic Reforms (ADR), at least 14 spent more money in FY15-16 than their stated income from both known and unknown sources.

Since 15 of those 47 parties did not submit detailed audit reports to the Election Commission, it’s not possible to make an inference either way about them. Akhilesh Yadav-led Samajwadi Party and Lalu Prasad-led Rashtriya Janata Dal are among the parties that failed to follow the EC directive, according to the ADR report released on Friday.

Among the 14 that did report more spending than income, Nitish Kumar-led Janata Dal (United) and Ajit Singh-led Rashtriya Lok Dal spent close to 200% of what was accounted under the head of income.

A previous analysis by ADR also shows that the number of parties which spend more than their income goes up during elections.

The total income of the 32 parties for whom such details were made available was Rs.221.48 crore. Southern regional parties like the Dravida Munnetra Kazhagam (DMK), All India Anna Dravida Munnetra Kazhagam (AIADMK) and the Telugu Desam Party (TDP) were the richest, with the three accounting for over 60% of the total reported income.

However, nearly 90% of the income of both the DMK and AIADMK remained unspent for some reason. Tamil Nadu went to the polls in May 2016.

The ADR report also did a detailed study of unknown sources of income as declared by the parties in their income tax returns.

Unlike national parties that declare close to 70% of their income as coming from unknown sources, only 20% of the income recorded by regional parties was from unknown sources. A major chunk of these donations below Rs20,000 was recorded as “voluntary contributions". Parties with the highest amounts recorded from unknown sources were TDP, Telangana Rashtra Samithi and Shiromani Akali Dal.

In order to tackle the problem of unaccounted money funding political campaigns, the report recommended that details of all donors be made available for public scrutiny under the Right to Information Act. The report also said parties that do not satisfy existing directives regarding submission of IT returns and annual audits should not be tax-exempted and must be derecognised.

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