Electoral Bonds: A Veil over a Veil

The bulk of the funding required by political parties, whether to buy MLAs or distribute booze and cash at poll time, comes from unaccounted sources

Electoral bonds: veil over a veil

Citizens don’t have the right to know the source of political parties’ funds, says the learned attorney general in GoI’s submission to the Supreme Court, which has now taken up the case against electoral bonds. Electoral bonds do not, he argues, violate any fundamental right guaranteed by the Constitution.

This is like arguing a wife has no business to know if her husband is cheating on her, or vice versa. Adultery does not, after all, violate any law. The issue at stake is the authenticity of the relationship — between spouses in one case, and between voter and party she votes for in the other. The importance of the matter goes beyond legal form, all the way to the intimate core of the relationship.

‘Tata-Birla ki sarkar’ used to be a biting shard of abuse hurled by the Opposition against the government of the day. The implicit assumption is that it matters a whole lot for whom the government works. Of course, the attorney general may argue that the notion that whoever pays the piper calls the tune is non-statutory convention. After all, did the mayor and councilmen of Hamelin know enough to tell the piper what tune to play to get rid of rats? Electoral bonds are a veil over a veil. It should be ripped apart, and the veil beneath removed, as well.

First, let us accept that electoral bonds represent only a fraction of contributions parties receive or extract from businesses. India’s politics, as practised, is dirty, and most of it calls for money. Officially received funds, whether by transparent cheque or opaque bond, cannot be used to fund such dirty activity, because that would be self-incriminating.When parties distribute cash and liquor before elections, money is paid to crowd-mobilisers at an agreed rate per head, MLAs are induced to defect, candidates are paid off to not contest, certain parties are encouraged to put up candidates with the sole purpose of dividing votes, rather than to get them elected, when goons are sent to intimidate voters, the money that is spent on such and many other dirty tricks cannot be accounted for.

The money mobilised through electoral bonds and other official contributions only serves to account for the political activity that falls within legal limits in terms of the nature of the activity and extent of expenditure. If your actual publicity expenditure is five times what is legally permissible, four-fifths of the wholly legal activity of media advertising and posters would have to be financed from unaccounted sources.

That being the case, why bring in electoral bonds? These are opaque, and who gave how much to whom is visible only to the officials of the bank that issues the bonds to identified entities and redeems them later from identified political parties. GoI owns the bank, its people know who gave how much to which party. RBI supervises the bank, and presumably has the means to find out the same information.

Since none of these entities, the bank, RBI and GoI, is monolithic, and parties have access to diverse kinds of people, senior members of the political class cutting across parties would know who gave how much to whom.

So, electoral bonds are opaque only to ordinary voters. Why bring in such an instrument? It is a prop in the official charade that GoI wants to eliminate unaccounted black money from political funding. While electoral bonds may be anonymous, they are, at least, derived from formal bank accounts. That means a victory in the battle against black money. This, of course, is only as valid as a Pakistan-printed Indian ₹1,000 note.

The bulk of political funding still comes from unaccounted sources to finance illegal activity. How can we clean up political funding?

The first step is to accept that politics is expensive, and calls for lots of money. Remove the arbitrary ceilings on poll expenses. Then, get a grip on the actual expenditure by a party.

This calls for crowdsourcing information on political activity of all kinds by any party, their compilation every month or quarter, estimating the cost of such activity, and asking parties to contest such claims of expenditure and come up with sources to finance accepted expenditure. This should be done at every level, starting from the polling booth to state and national levels, through block and district levels.

The Election Commission should have offices at every level, and it should encourage voluntary watchdogs, media and rival parties to submit information on each and every political activity and its plausible cost. At each level, a figure should be finalised for each party, and it asked to furnish the source of financing.

Scrap the current law exempting donations smaller than ₹20,000 to be accepted as anonymous cash donations. Let every contribution to a political party be made via UPI, so that there would be an audit trail for every single donation, however small.

For this model to work, the biggest requirement is sanitising politics itself, and then to carry out expert costing of the remaining valid political activity. As democracies mature, so would their ability to monitor political funding. Electoral bonds are a charade, no shortcut.