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Afew weeks ago, Rahul Matthan’s ‘Ex Machina’ column in the Views section of this paper underscored the need to redesign the country’s pre-legislative consultation process. A key assumption in the piece was the genial nature of a government that could be expected to adhere to an ideal consultation process. However, as Milton Friedman put it, “The world runs on individuals pursuing their separate interests." This piece proposes a system of accountability in the law-making process itself that monitors the self-interested incentives of the government.

A Litany of woes: The Seventeenth Lok Sabha has passed about 150 bills so far. As an approximation, 15 bills have been passed per session. But even as one may applaud such productivity, it has come at the cost of debate and deliberation, two core ideas of democracy that Parliament stands for. Let’s call this the ‘cost to democracy’. A few laws and conventions in our parliamentary system are the key perpetrators. The Executive is an integral part of the Legislature, and thus, when coupled with the anti-defection law, it assumes unfettered control over the Legislature. There were no problems with this arrangement in the era of coalition politics. But it begs us to rethink this system in the face of majority governments.

Juxtapose the problem of an over-powerful Executive with this policy prescription from the field of economics: ‘Government intervention comes at a cost.’ The marginal cost of public funds captures this idea: what is the opportunity cost to the economy for additional rupee spent by the government? Empirical estimates, based on a model that compares the inefficiency of government expenditure with the efficiency of private spending, put this figure at about 3 in India. Multiplying it by the volume of government spending, the figure would be monstrous. This can be interpreted as a ‘cost to efficiency’ imposed by the state .

In the realm of the feasible, can we design an inherent check in our laws that seeks more accountability from the Executive to minimize these two costs? More importantly, can we design a check that is politically palatable?

The fix: pre-legislative checks: The Legislation and Expenditure Accountability Bill, 2022 (bit.ly/3zDs98K), which was introduced as a private member’s bill on 1 April 2022 in the Rajya Sabha, attempts a solution. It demands that the Executive think about its actions before going ahead and weed out those interventions that are doing more harm than good to society. The bill goes two steps further than the 2014 Pre-legislative Consultation Policy. First, it is a bill, which means that if it becomes an Act, it will be legally binding on the government. Second, it adds the dimension of a post-legislative check with fail-safe mechanisms.

The specifics of the bill revolve around two technical assessments: a legislation impact analysis or LIA (and correspondingly, a scheme impact analysis for public schemes) and a post-implementation assessment (PIA) report. The former is a pre-legislative check and the latter a post-legislative one. These ideas are not novel. Such checks are already in place in mature democracies.

The bill’s idea of a legislation impact analysis was drawn from US Executive Order 12291 (bit.ly/3y81eka) of President Ronald Reagan and remodelled for the Indian system. The central principles, however, remain the same: any law or scheme must be based on the principle that its benefits outweigh the costs, and that among the various alternatives available, the chosen one confers maximum net benefits. Based on these principles, the Executive must present to Parliament an LIA (or SIA) for any major legislation (or scheme) to be introduced. This report must offer an assessment of potential costs and benefits to society, an analysis of stakeholders, the objectives of the intervention with clear measurable outcomes, and the experience of other countries, among other things.

Post-legislative checks: An accountability mechanism that aims to be comprehensive cannot end there. Even a law commended for its design and intent could see faulty implementation. So this also needs to be accounted for within the frame of the law itself. This warrants that all major laws (or schemes) be evaluated against clear objectives laid out in the LIA (or SIA) by means of a PIA report. The PIA has three aspects: performance measurement, which evaluates schemes and laws against the objectives defined in the LIA; impact assessment, which evaluates qualitative aspects like social, environmental and legal effects and spillovers; and finally, perception surveys that measure people’s satisfaction. All these elements have been borrowed from the Organisation for Economic Cooperation and Development recommendations that the ‘Ex Machina’ article alluded to.

Lastly, the bill incorporates a foolproof mechanism to ensure that the accountability mechanism is more than just about presenting reports. As India cannot afford an overhang of outdated legislation that does not improve governance outcomes, the bill requires our laws and schemes to have expiry dates (sunset clauses). Such a provision would grant us an opportunity to re-make laws and schemes, thus ensuring that our nation stays up to date on evolving dynamics of the world. Moreover, if a law or scheme fails its PIA test in three consecutive reviews, it would automatically be repealed.

The ideas in this bill all sound good. But we have a simple question: what about its implementation? After all, the bill demands considerable effort by the Executive to undertake proper evaluations of schemes and legislative moves. Hopefully, it can at least lay the groundwork for a new institutional mechanism to ensure self-probity in public expenditure and law-making. It could also serve as a step towards enhancing our national discourse on government intervention.

Sujeet Kumar, Vedant Monger & Vikram Vennelakanti are, respectively, a Rajya Sabha member from the Biju Janata Dal, and former Legislative Assistants to Members of Parliament (LAMP) fellows

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