Don’t Le­git­imise Opaque Poll Funds

Elec­toral bonds scrap trans­parency as norm

The Economic Times - - Breaking Ideas Weak Fdi Flows -

It is wel­come that the gov­ern­ment has taken up the im­por­tant sub­ject of re­form­ing po­lit­i­cal fund­ing. But the pro­posal set out in the Bud­get, to let donors buy so-called elec­toral bonds that can be re­deemed only in the ac­count of a po­lit­i­cal party from banks and do­nate them to the party of their choice, serves lit­tle pur­pose. In­stead of ad­vanc­ing trans­parency, the bond gives le­git­i­macy to opaque con­tri­bu­tions to po­lit­i­cal par­ties, trash­ing the present norm that par­ties must main­tain a list of all donors who con­trib­ute any sum larger than 20,000. This de­nies ci­ti­zens the right to know who funds par­ties.

The iden­tity of bond buy­ers and par­ties re­deem­ing them will be known to the banks is­su­ing them, the Re­serve Bank of In­dia (RBI) and — pre­sum­ably — the rul­ing gov­ern­ment of the day. This leaves the mech­a­nism open to abuse by in­cum­bent par­ties, and wreck the mar­ket for th­ese bonds. In a democ­racy, the fun­da­men­tal point of cam­paign fi­nance reform is to let every voter know the iden­ti­ties of big po­lit­i­cal fun­ders, and their in­ter­est in do­ing so. Poll bonds do the ex­act op­po­site. Nor will low­er­ing the ceil­ing on anony­mous cash do­na­tions from 20,000 to 2,000 de­ter donors or par­ties from giv­ing or ac­cept­ing unnamed cash do­na­tions: the num­ber of donors will sim­ply go up 10 times. In any case, par­ties show only a frac­tion of their ac­tual spend­ing in the ac­counts they file. Iden­ti­fy­ing the source of in­come for this sliver of their spend­ing is nei­ther here nor there. The start­ing point of the reform we need is to get a han­dle on re­al­is­tic spend­ing by any party.

Things might work bet­ter if the Elec­tion Com­mis­sion scrapped its im­prac­ti­cal spend­ing limit and, in­stead, made it com­pul­sory for each party and can­di­date to re­veal spend­ing at each level, start­ing from the polling booth. Th­ese num­bers should be open to chal­lenge by ri­vals, the me­dia and watch­dog bod­ies. The EC can then fi­nalise ac­tual spend­ing, and ask par­ties to re­veal from whom all they re­ceived this money. This might still leave some po­lit­i­cal fund­ing un­ac­counted, but would still mark a huge im­prove­ment over the cur­rent state of af­fairs. At any rate, pol­icy should not val­orise opaque po­lit­i­cal fund­ing.

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