Editorial: Reform political funding

Whatever the mode of funding, the objective should be to ensure transparent funding of parties in a healthy democracy

With the Supreme Court striking down the electoral bonds scheme as unconstitutional and violative of the right to information of citizens, it is time the country worked towards comprehensive reforms in political funding to make it truly transparent. Without genuine reforms, electoral bonds will be replaced by unaccounted cash funding; a cure worse than the disease. One of the ideas that can be explored is the public funding of elections. Several advanced countries are exploring this method so that the electoral process is not monopolised by corporate entities. Public funding of elections and political parties, however, is a matter of legislative policy, not of constitutional adjudication. Whatever the mode of funding, the objective should be to ensure transparent funding of parties in a healthy democracy. While there are no quick fixes, there is a need to insulate people’s lives and economic prospects from the vagaries of politics and also to adopt an electoral system that allows the rise of competent, honest, public-spirited citizens through ethical and rational means. Secret funding to parties is not conducive to healthy democracy. People have the right to know who funded political parties. If there is no real rule of law, and economic fortunes of enterprises are dictated by political whims, many donors are afraid to openly fund parties of their choice. Hence, there is a need to institute genuine rule of law and create a political culture that does not penalise supporters of rival parties. It will take years of dedicated reform to achieve this.
India has never had a tradition of transparent political funding. Even during colonial rule, the industrialists who funded the Congress were not keen to be identified as funders of nationalist revolt. Even after independence, all political parties kept their funding opaque. India can learn from the United States, Britain and European countries on how to make the process transparent and accountable.

Political contributions should be mandated to be made through electronic means, by UPI for small amounts and bank-to-bank transfer in the case of larger amounts. These leave an audit trail. Cleaning up politics is a prerequisite for its transparent funding. The apex court’s verdict on electoral bonds is a welcome development as it opens up debate on how to clean up politics and its funding. The real political spend in most States is the illegitimate and unaccounted expenditure to entice the voters. This inexhaustible appetite for illegitimate expenditure in politics can only be addressed by reforms in the electoral system, not by tinkering. Parties now need to bury the hatchet and build consensus on meaningful electoral reforms. India should track political activity at all levels, starting from the polling booth hinterland and going all the way up to the State and national level. The expenditure incurred in each activity can be assessed, and aggregated at the national level.