Political Diary

New Delhi, 7 November 2023

Electoral Bonds

ALL HUSH-HUSH ABOUT SLUSH

By Poonam I Kaushish 

As we gasp in our polluted gas chamber, trust our political tribe to add toxicity thanks to their venomous and acidic tu-tu-mein-mein in the on-going Great Indian Dance of Democracy in 5 States. Wherein Parties have opened their secret war chests and are busy ‘funding’ their vacuous promises. After all, what better time to hit the jackpot! 

Primarily, because elections are used to amass wealth for Parties, candidates and future polls. Like politics, polls are a business which is why no Party, however vocal about the matter in opposition, has made any attempt at stanching flow of black money into the electoral arena. Think: Between 2004-05 to 2014-15 national Parties income was Rs 6612.42 crores of which 69% was from ‘unknown sources’ which increased to Rs 17,250.201 crores as Election Commission (EC) doesn’t require Parties to declare the source below Rs 20,000.

The Government’s explanation: Parties need clean money as they have to show expenditures for rallies, etc. So it deposits Rs 100 crores saying so many people deposited Rs 19,000 each to me. So, the cash I received I show as ‘unknown sources.

Pertinently to end this scourge, Modi Sarkar mooted electoral bonds to pay for elections and help cleanse political funding in 2018. This allowed anonymous donations through bonds which could be bought at a bank in denominations ranging from Rs 1,000 to Rs 1 crore and given to a Party, which could exchange them for cash. But the donor remained faceless.

A year later Supreme Court asked Parties to give details of donors who donated through electoral bonds, details and amounts received on each bond etc to EC, which said of the Rs 221 crores bonds purchased Rs 210 crores had gone to BJP.

The Government argued transparency cannot be the mantra as voters have the right to know about their candidates but why should they know where money of Parties is coming from? Adding, if donors are asked to disclose names of Parties to whom they give money, it would result in return to the earlier system of usage of cash and black money in political funding.

However, the EC opposes this as it would have a “serious impact” and reduce transparency in political funding by legalizing large unknown contributions which can potentially lead to businesses and foreign companies gaining influence over elections.  Also, it would be impossible to determine whether donations to Parties came from companies breaking the law, State-owned public sector units or foreign sources. Thereby, demeaning transparency and giving rise to opaqueness.

Last week again Supreme Court heard the electoral bond issue and even though it reserved its judgment, it pointedly asked: “The source of money is not known, actual owner of bond is not known and where it is spent is not known thereby depriving the voter.” Pulling up the Government it averred, “your contention voters do not have the right to know is difficult….It gives credence to allegations of corporates using shell companies to donate. In 2021-22 income of 8 Parties from ‘unknown sources’ was Rs 2,172.23 crores, 66%.

Alas, bonds have become legitimized quid-pro-quo, business proposition and political insurance between Government-corporates. A person helps a Party with funds and, in return, gets his job done. Any wonder the bond-donation cup overflows whenever a Party is in power at Centre or States. The BJP received Rs 10,122.03 between 2016-17 and 2021-22, Congress Rs 1,547.43, TMC Rs 823.30.

A cursory glance of affidavits filed with EC reveals the bizarre realities of politics. It showcases contributions from business houses that directly benefited from Party in power. A steel magnate paid Rs 50 crores and got highway construction contracts, a metal baron who funded BJP became proud owner of 51% of Bharat Aluminum Co Ltd.

The Government’s explanation that bonds have to be bought at State Bank and would be “white” does not hold good as anonymity makes it impossible to check who is funding a Party. Government for reasons best known to it has taken away checks that ensured only profitable companies which existed over three years could donate. This prevented shell companies being set up to help “round-trip” money or whitewash it by giving it to Parties, while also bribing them in the process.

Undeniably, bonds are a business proposition, kickback for a favour, political insurance, quid pro quo. See how the donation cup overflows whenever a Party is in power at the Centre or States. The modus operandi is simple. A person helps a Party with funds and, in return, gets his job done. It is not for nothing that businessmen are known as king-makers, specially, a handful of top industrial houses which boast about their clout in the corridors of power

Total donations received by BJP in 2016-17 was Rs 997 crores of which it got Rs 468 crore in cash donations, each below Rs 20,000, from anonymous persons and Congress received Rs 180 crore in donations of which Rs 138 crore was through small donations from anonymous persons. In 2017-18 BJP received five times more than what Congress. In 20-22 BJP got Rs 614 crores, Congress mere 94 crores.

Questionably, do bonds fulfil its objectives --- stop generation and use of black money, besides getting Parties to submit their audited accounts regularly? No. Does it stop the use of money power which has become the bane of India’s electoral polities? No way. Does it decrease corruption? Not at all. Bring about the much-hyped and promised transparency? Are you kidding?

More. Who buys bonds? Corporates and businessmen. Are disclosures of the source of money obligatory on those who buy them? Not at all. Asserted a former Election Commissioner, “Bonds and donations are welcome but they could be an easy way to launder black money if disclosure of the source is not made mandatory. Transparency on political funding, as in the West, is a must before exemption is allowed. Anonymity of bond buyers has to go. We cannot go one step forward and two steps backwards. We want free and fair polls.”

The way out? In a milieu where netas have much to lose and public everything to gain by a transparent funding system, unless one determines the sources which should be legally tapped for Party expenses there is little hope of minimizing the evil influence of vested interests. Two, donations should be evenly spread out, not necessarily equally, but perhaps in some proportion to seats in Parliament.

Three, reducing cash element in polls whereby donations should be given to the EC which will then distribute it on an equitable basis. Four, amount be released to candidates, not Parties. Five, encourage and incentivizing use of authourised banking channels. Six, 50% given as advance, pre-election on past performance basis. Seven, State funding of elections and funds be apportioned on vote basis secured by candidates.

In sum, we still have a long way to go before we can make elections free and fair as Parties will continue to stonewall all efforts to come clean on funding. Thus, irrespective of whether a Party is in power, bonds and donations must be made public as people have the right to know whether a Party’s stand on a policy is influenced by the source of its funding. Time to end bhrashtachaar. Else our netagan’s tall talk of eradicating corruption will remain empty blabber! ------ INFA

(Copyright, India News & Feature Alliance)