To avoid repeat of electoral bonds saga, Quraishi urges 'national fund' for parties

With the scrapping of the electoral bonds scheme bringing political financing into focus, former chief election commissioner (CEC) S.Y. Quraishi on Wednesday pitched for the setting up of a 'national fund' to which donations can be made by corporates and then distributed to parties in proportion to their performance in the immediate past election.

Quraishi said instead of giving money for elections, funding political parties would be a better option as it would take care of the outfits' organisational needs and political activities.

In an interview to PTI videos, the former CEC said the electoral bonds scheme spoke of transparency when it was introduced in 2017, but ended up "decimating" the transparency that existed until then.

"If you recall the then finance minister Arun Jaitley started his speech very beautifully when he stated that without transparency in political funding, free and fair elections are not possible. This was music to our ears because that is what we had been saying. His second statement was equally good that for the last 70 years, we have failed to achieve that transparency...

"And we expected his third sentence to be that we are going to achieve transparency and this is how we will do it," Quraishi said. "What he did was to decimate all the transparency that existed until then. The transparency that existed was that every donation of over Rs 20,000 was reported to the Election Commission," said Quraishi, who was CEC between July 2010 and June 2012.

He said there was no problem with the electoral bonds scheme replacing cash transactions with banking, but he did not agree with the contention that a donor wanted secrecy because he or she was scared of reprisals. "I question that. In the last 70 years, the same donors have been donating to all parties that have been winning and losing elections.

"Nobody has complained of reprisals. I ask the BJP, have you committed reprisals against Congress donors or has the Congress done any reprisals against your donors? Never," he said.

Quraishi said the donors are very smart and clever and donate to all parties. Only those corporations with the intention of quid pro quo would want secrecy, he claimed. "I am glad that the Supreme Court has struck down the electoral bonds scheme as unconstitutional and as you can see, lots of skeletons are coming out of the cupboard.

"My stand is that skeletons will keep coming out, there will be lots of information, but don't go into the post-mortem of all that," he said, adding that the focus should be on the way forward.

Stressing the need for reform, he said the country is now back to the 2017-18 situation where "nobody knew where the money was coming from".

"After the electoral bonds were declared unconstitutional, we are back to the situation of 2018, when the scheme became operational. Was it a happy situation then? Certainly not," he said. He said the Election Commission of India (ECI), concerned citizens and think tanks have been fighting against money power in polls.

"What was the situation in 2017, 70 per cent of fund collection was by cash. Nobody knew where the money was coming from. This could be drug money, this could be land mafia, foreign money. How can we run our democracy on the strength of money which is totally questionable? That is why we wanted reform," Quraishi said.

He said the demand for reform has now been revived. "We have to do away with the cash system. In that context, I have suggested we set up a national election fund. There, nobody will be scared to donate, it is going to a national fund," Quraishi told PTI. "If you donate to a national election fund, from there money will be distributed to the parties."

Quraishi suggested the money in the fund can be sourced from corporate donors and the government can also donate from the national exchequer through the budget.

However, noting that some would not like the idea of taxpayers' money being used for political purposes, Quraishi said the sourcing can be restricted to voluntary donations from corporates and also corporate social responsibility funding.

Voluntary corporate donations can be given incentives like 100 per cent income tax relief, he argued. "We can also use corporate social responsibility funds. All this is subject to detailed fleshing out," Quraishi said.

Talking about the distribution of the fund, he said elections should not be funded and instead, political parties should be funded. "The formula for funding can be that we distribute it equally among the nationally recognised parties, but all this is subject to discussion.

"What I have suggested is that the parties be given funds based on their electoral performance in the immediate past election. That is the most objective criterion," Quraishi said. "According to the number of votes you have got, for every vote, Rs 100 or even Rs 200 could be given. In the previous election, 60 crore votes were cast, so if Rs 100 is paid for every vote, it would be a total of Rs 6,000 crore in funding."

"Will that be enough, I think it will be enough. All parties when they declare to EC their collection of the last five years, it is less than Rs 6,000 crore. They collect it by begging, borrowing, twisting arms, and corruption. All that will disappear," he said.

Asked what would happen to fledgling parties, Quraishi cited the example of the Aam Aadmi Party and said the outfit must first display its seriousness and performance, and then could be eligible for funds. “The AAP fought the elections without money and won hands down. They proved their seriousness and popularity without the strength of money and if my formula had come into operation, they would have been the richest party after the (Assembly) polls in which they won 67 out of 70 seats,” he said.

“The party has to prove its seriousness first. Are you a serious party or a fly-by-night operator?” he asked, adding that details and the nitty-gritty of the system can be worked out if the concept is accepted in principle.

“One solution is that a new party is given an ‘x’ amount of money as a loan. Similarly, independents could also be given funds according to the number of votes that they bag," Quraishi said. “If you are independent and get only one vote, I am happy to give you Rs 100. All operational details can be worked out in due course," he said adding the idea is to eliminate non-serious people out to make a quick buck.

He said if people want to fund a particular ideology only, parallelly they can find the party of their choice directly but only through a cheque. Two systems can be run parallelly, he added.

In February, the Supreme Court delivered its judgment in the electoral bonds case, striking down the electoral bonds scheme. Following a court directive, the State Bank of India (SBI), which was the authorised seller of electoral bonds, shared the electoral bonds data with the ECI on 12 March.

The SBI said a total of 22,217 electoral bonds of varying denominations were purchased by donors between 1 April 2019, and 15 February this year, of which 22,030 were redeemed by political parties.