Mr Jaitley, make Aadhaar compulsory for political funding

Finance Minister Arun Jaitley challenged the Opposition in the Lok Sabha on Thursday to come up with suggestions to make electoral funding cleaner and transparent. Well, the fact is that there never has been any dearth of ideas for cleaner and more open electoral funding; what has been lacking is the political will to sincerely implement them.

The changes brought in by Finance Bill 2017, in fact, only make electoral funding more opaque. Still, let’s assume—though it would be a very naive thing to do—in good faith that every rupee a political party gets is jotted in its account books. Without even getting into the cliché of state funding of elections, here are five suggestions for the FM:

Every political party needs to account for every rupee spent

To start with, the Finance Minister could get his own party, BJP, to make public every rupee that it spends (and receives). For instance, in any election, there are a number of ‘mega’ rallies that are organised. To any onlooker, it is obvious that crores would have been spent on it. Why not just put out the accounts for how much was spent on each aspect of the rally?

Reducing the cash limit from ₹20,000 to ₹2,000 means little if there isn’t any change in how much political parties will have to disclose

Amend Section 29C of The Representation of People Act, 1951. The section at present mandates that only donations of ₹20,000 or above will be required to be reported to the IT Department or to the Election Commission of India. It should be changed to ₹2,000 or above. Otherwise, it doesn’t make any difference except that the political parties will have to do more paperwork. That is, instead of showing cash receipts (for donations) of ₹19,999, they will have to show receipts for ₹1,999.

Discourage or remove the ‘unknown’ sources for funds

Even if cash donations can be made only up to ₹2,000, political parties could attribute it to anonymous sources. That is, nothing much has been done to curtail anonymous donations such as sale of coupons and the like. A study by the Association for Democratic Reforms showed that the majority of funding across all political parties was through “unknown sources”. The fact is parties can voluntarily declare details of every rupee they receive, and how they spend it. Why not do away with the provision for anonymity?

How come the FM did not think of Aadhaar for political donations?

The NDA government has been grossly defying the Supreme Court order on not making Aadhaar mandatory for even welfare programmes. However, the Centre has been extending it to as many areas as possible—from declaring Income Tax returns to linking it to PAN. The argument for the move has been mainly on transparency, efficiency and what not. So, why then hasn’t Aadhaar been made mandatory for political donations?

Remove opacity behind the issuance of ‘electoral bonds’ and corporate funding

If someone contributes through a cheque or an electronic transfer an amount above ₹20,000 directly to parties, then this will mandatorily have to be made public. However, if donations are made even in crores through ‘electoral bonds’, then the scheme is structured such that it provides anonymity to the donor. Why should that be so? This only gives scope for corruption to breed.

With this, other political parties may not know when the bonds are transferred to a particular party's account. However, any individual or corporate that contributes large amounts is not doing so without expecting something in return. While the money donated technically may be “clean”, it rather would be a new, anonymous and legal way to “pay bribe”. This would only strengthen the unholy alliance of corporates-politicians-bureaucrats that would lead to corruption where policies could be skewed to suit a few players.

Worse, with one of the amendments sneaked into as ‘money bill’ being Article 154 of the Companies Act, the scope for sleaze just hit a new high. Now, corporates can make unlimited donations and will not even have to mention the name of the political party. Even shareholders will now not have a clue. Why not just allow all donations—even through electoral bonds—be open?