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Do we have a Robust Alternative to Electoral Bonds?

If bonds scheme was struck down to end opacity in political funding, will SC, HC judges declare assets annually to ring in transparency?


Electoral bonds have been demonised. Bond purchasers, donors to political parties and all elected representatives have been thrashed in the process.

After Supreme Court struck down electoral bonds scheme what followed was ‘headline hogging’ competition from every possible analyst, writer or commentator.

Given that the five-member Supreme Court judgement on electoral bonds was unanimous, there has been enough mud-slinging on political parties, leaders and every individual associated with the political spectrum.

Each write up made valiant attempt to ‘get to the truth’ claims and gave out figures of ‘who paid whom’ kind of screaming headlines. At stake was Rs 16, 518 crore worth bonds purchased and donated to over two dozen parties in seven years at least.

What’s unacceptable though is to depict every corporate, high net-worth individual, small or big donor, social foundation as ‘dirty’. Attributing motives to every donation made irrespective of their standing in the society smacks of cynicism at its best. Over 300 petitions have reportedly been filed by individuals, businesses and industry bodies drawing them into slugfest between parties that have benefited from political funding through bonds.

Let’s not forget that barring a few swindlers, not all businesses and individuals that contributed to political parties were ‘fraudsters’. For decades political parties were run on cash donations that were hardly accounted for.

Today, at least a big chunk of political funding through electoral bonds has been accounted for and donations have been made through banking transactions. These transactions need to reflect in returns filed by political parties. Companies and individuals have to show source of these funds utilized to buy electoral bonds. After the ‘Lordships’ insisted, we even know as to ‘who’s who’ made donations and the parties that en-cashed these bonds.

When late Arun Jaitley piloted electoral bonds scheme in 2017-18 through Bharat’s budget, it was hailed as first step towards bringing in transparency to otherwise unaccounted ‘cash donations’. Ringing in transparency and accountability to electoral funding is what Arun Jaitley had declared as the avowed objective.

Honourable judges that declared electoral bonds as ‘opaque tools’ may have either been blissfully unaware of the past ‘black money market’ in politics or chose to ignore the illicit cash that made way into elections in Bharat.

They may have conveniently forgotten or chose to ignore government’s bid to end cash flows into political parties. But, the fact is that electoral bonds were a baby step towards making political donations more transparent. Otherwise, restricting cash donations to Rs 2000 would not have been announced by then finance minister Arun Jaitley. There was a need to cleanse political funding in India, Jailey had stated in his budget speech. By amending Reserve Bank of India (RBI) act, the bonds scheme became operative on January 2, 2018. State Bank of India was designated as issuer of the electoral bonds.

“If you ask people to disclose that (identity of the donor), I’m afraid the cash system will be back”, Arun Jaitley had stated. Well that may be come true given that SBI has been forced by Supreme Court to divulge unique identification number of each electoral bond, along with value, date of purchase and donors names.

This will enable mapping political parties as beneficiaries and each donor would be identified. It’s akin to disclosing publicly from election booth as who a voter was voting for? If ‘secret ballot’ was sacrosanct in electoral process, then keeping political donations discreet was an imperative at least for now.

There are valid reasons for keeping identity of donors – individuals and firms, domestic and abroad – under wraps till an effective alternative system was in place. Apprehension otherwise is that witch hunt would begin once a political regime changes in states or centre. As long as central and state agencies are convinced that there was no malaise in political donations, then keeping political funding under wraps is an option. Secondly, disclosures on political funding by businesses or individuals, big and small, should be voluntary rather than by statute.

Thirdly, a roadmap to achieve full transparency in political funding can be put together through a wider national debate. Fourthly, given that electoral bonds are not available for 2024 general elections and four state legislative assemblies, a comprehensive study on possible role of unaccounted cash or black money may have to be instituted. Fifthly, preference to a political ideology, party or policies of a particular formation need not necessarily be due to business considerations or ‘revdies’ that some parties are good at distributing to purchase votes. It’s not that every donor has a clear ‘business motive’ attached to his contribution.

One tends to agree with Finance Minister Nirmala Sitharaman when she says that it’s a ‘huge assumption’ to say that top 30 corporate companies made political donations through bonds to ‘save themselves’ from investigative agencies. Or, construing these donations to be ‘protection money’ is again a false narrative being peddled by a few groups or individuals.

Trust and credibility of electoral bonds was an issue that was flagged by Supreme Court’s five-judge constitution bench when it struck down the scheme last week. Trust and credibility was also the issue pointed to while asking all elected members of Parliament, state legislatures and councils to declare their assets annually.

If transparency, credibility and trust are the factors that govern political parties and elected representatives, then should judges of Supreme Court and 25-state high courts not declare their assets every year? Why are the honourable Lordships or the Supreme Court registry sitting on a recommendation of the 30-members Parliamentary Standing Committee led by BJP member Sushil Kumar Modi?

Opacity, corruption and power peddling will have to be tackled in all arms of governance including judiciary. Will the Lordships usher in transparency? Should electoral bonds not continue in absence of a more robust, alternative to fund elections? Is belittling or trivializing every political formation or elected representative the motive behind headline hogging SC commentary each day? Is attributing motive to donors of every political party the right thing?

These questions remain unanswered as Lordships sit pretty and cash is expected to make its way back in this round of elections in 2024.

(Author is Director & Chief Executive, Centre for Integrated and Holistic Studies, a non-partisan think tank based in New Delhi)

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