Freebies by Political Parties

In News

• Recently, the Election Commission of India (ECI) replied to the Supreme Court (SC) in a PIL against freebies offered by the state parties.

Argument favouring the Plea

• Violates constitutional provisions: The plea highlights that the promise of irrational freebies, which are not for public purposes, from public funds before election, violates Articles 14, 162, 266(3), and 282 of the Constitution.

ECI’s Stand

• Will of political parties:
  • ECI stated that offering freebies before or after the election is a policy decision of political parties.
• Voter’s discretion:
  • Financial viability of these policies and their adverse effects on the economic health of the state is a question that has to be considered and decided by the voters. 
• Need for enabling law:
  • ECI is of the opinion that without enabling provisions in the law, de-registration of political parties will be an overreach of powers. 
• Action taken by ECI to avoid such scenarios:
  • Model code of conduct guidelines have been framed by ECI after consultation with recognised political parties.
  • The promises made in manifestos are not enforceable under election law. 
  • However, the ECI had advised all the recognised political parties to submit a declaration along with the copies of the manifestoes. Also to see that the promises made therein are in consonance with the Model Code of Conduct.

Deregistration of Political Parties

• Background: 
  • In December 2016, 47 proposals were sent to the Centre on reforms relating to political parties, including their de-registration. 
  • It was recommended to the Law Ministry to enable the EC to exercise the power to de-register a political party and to issue necessary orders regulating registration and de-registration of political parties.
• SC’s verdict:
  • The Supreme Court in its verdict of 2002,  in case of Indian National Congress Vs Institute of Social Welfare and others, had directed that the EC had no power to cancel the registration of a political party except for three grounds.
    • Registration obtained on fraud and forgery, 
    • Party ceased to have faith and allegiance to the Constitution, and 
    • Any other similar ground.

Freebies

• There is no such thing as a freebie in economics because ultimately somebody has to bear the cost of the supposedly free giveaways. 
• The concept is popularly known as There’s No Such Thing as a Free Lunch. 
• It means that  everything has to be paid for by taxes if not today then tomorrow. 

Problems with Freebies

• Financial irregularity: The reckless spending of the taxpayers money on freebies is neither a recognised policy/custom nor it is sanctioned in a court of law. It is blatant financial irregularity that amounts to bribing voters using public money solely for gaining advantage in electoral politics.
• Burden on Public Exchequer: If states continue with fiscal profligacy, they will be heading towards unsustainable high debt with catastrophic consequences for macro-economic stability and ability of India to sustain high growth. 
• Vote bank politics: Political parties’ promises to lure voters in their favour is analogous to bribery and undue influences.
• Lacking equity or fairness: Freebies serve even those who are capable of managing on their own at the cost of those who can not pay for their own. This promotes inequality.
• Fiscal mismanagement: Most states lack the cushion to spend money as freebie and then be able to save state’s finances from going down into fiscal deficits.
• Promotes tax avoidance: Freebies may even trigger non-compliance amongst taxpayers and eventually lead to lower revenue. 

Image Courtesy:  LM 

Way Ahead

• There is an urgent need to put an end to freebies. 
• The Finance Commission should recommend a ban to freebies and if need be, it should ask the government to amend the Constitution.

Source: BS + TH