The role of money and muscle power in elections is a harsh reality that is both undeniable and undesirable. Political finance is a critical component of democracy, enabling parties to administer their organizations, connect with voters, disseminate information, and gather support through campaigning. However, this monetary requirement can turn into a double-edged sword, as funding becomes a powerful tool for manipulating the political landscape.
The money spent in elections in India in the recent past has surpassed all global records causing a serious dent to any claims of our country being a genuine democracy. For example, it is reported that more than $8 billion (₹55,000 crores) were spent in the 2019 Lok Sabha elections, making it the world’s most expensive election.
According to a study carried out by the Centre for Media Studies (CMS), “In 20 years, involving six elections to Lok Sabha between 1998 and 2019, the election expenditure has gone up by around six times from ₹9,000 crores to around ₹55,000 crores.”
The same CMS report indicates that approximately a third of the total amount was allocated to campaigning and publicity. The second largest expense category was providing funds directly to voters. Thus 25% of the total amount i.e. ₹15,000 crores was illegally distributed among the electorate to influence their voting choice. Other data related to elections in India says that between 2004 to 2014, the self-reported wealth per candidate in Lok Sabha elections increased significantly. The median wealth of candidates in 2014 was 27 times higher than India’s per capita income.
Wealthy candidates
A peculiar feature of Indian elections is the reliance of political parties on candidates with substantial personal wealth. Consequently, candidates must primarily finance their campaigns, leading to a rise in wealthy candidates. This is very damaging for our democracy as it has shifted the criteria for candidate selection towards his/her wealth (which will be utilized in the poll campaign) rather than the desirable traits required for becoming a public representative/ lawmaker like decent education, track record of public service, integrity, ethics, understanding of policy and governance, leadership and decision making, etc.
It is statistically proven that wealthier candidates from mainstream political parties had a higher probability of winning elections. Also, the wealth gap between the top two candidates was strongly correlated with their electoral success. Those seeking to make a career in politics start viewing elections as investments to be recouped in office. Indian mainstream political parties exhibit low intra-party democracy, where decisions are controlled by a “great leader”, his/her coterie, or a small group of elites. Election tickets are often distributed or even sold by these party bigwigs without consulting their cadre and bypassing all norms of transparency and fair play.
The politics-business nexus
Uneven access to funds disrupts the level playing field and allows the corporate world (who are the main donors to political parties) to wield undue influence and potentially corrupt the electoral process through illicit finance flows and quid pro quo schemes.
The Election Commission of India (ECI) lacks the statutory authority to enforce its transparency guidelines, resulting in non-compliance and the absence of legal penalty. Financial disclosures of parties are inadequately scrutinized by tax authorities, perpetuating opacity in the funding sources of political entities.
Moreover, the Representation of the People Act, 1951 (RPA) which regulates expenditures of individual candidates, does not impose similar restrictions on party expenditures. Corporate entities face no caps on political contributions, with no requirement to report such donations in their profit and loss accounts.
Furthermore, the use of anonymous electoral bonds shields the identities of donors to political parties, perpetuating non-disclosure and legalizing opaque donations. According to an Association for Democratic Reforms (ADR) report, a staggering 70% of funds for national parties stem from ‘unknown sources’, highlighting the pervasive nature of undisclosed financing in Indian politics. The nominal ₹20,000 donation limit is easily circumvented due to lax disclosure requirements, further exacerbating the challenge of tracing the origins of political funding.
Possible solutions
Experts, political activists and social reformers have proposed various steps to clean the election-funding process. One approach involves encouraging corporations to make transparent political donations while adhering to legal requirements under the Companies Act, 2013.
Another strategy entails promoting structured and accountable political donations through registered electoral trusts, subject to rigorous regulatory scrutiny. By channeling contributions through legitimate trusts, transparency can be improved, ensuring funds are used responsibly.
Advocates also emphasize the importance of disclosing in-kind contributions to political causes, enhancing visibility and accountability in reporting practices. This measure seeks to shed light on non-monetary contributions that may influence political activities.
Another important suggestion involves establishing a National Election Fund for public funding of political parties based on electoral performance. This fund would reduce dependency on private corporate donations, ensuring transparency and fairness in campaign financing. The electoral bond scheme requires comprehensive reform to enhance transparency. This includes strengthening oversight by the Election Commission, implementing independent audit mechanisms, and verifying adherence to disclosure norms to restore public trust.
Public funding of political parties based on electoral performance can reduce reliance on private donations and enhance accountability. This approach would promote fairness and equal opportunity in campaign financing. Finally, emphasizing digital payments for all political transactions would ensure traceability and transparency in political finance.
Value-based politics the solution
Value-based politics can indeed play a significant role in cleaning up political finance by promoting transparency, accountability, and ethical conduct, including emphasis on integrity and ethics, encouraging transparency in funding sources, reducing dependence on big money, strengthening regulatory frameworks for campaign finance, building public trust in the political system, promoting grassroots participation and small donations, encouraging civic engagement around clean politics, and incentivizing ethical behavior among politicians and parties. By leveraging technology, financial transactions can be monitored and scrutinized, promoting honesty and ethics in electoral processes.
Once we clean and strengthen the political finance ecosystem, public trust and confidence in democratic governance can be restored.
Of course, this has to start with the moral reformation of man. Only true religion can accomplish this requirement of developing a morally conscientious society. For that politics will have to shed its anathema to religion.
As a famous couplet by Iqbal says, Jalal-E-Padshahi Ho K Jamhoori Tamasha Ho; Juda Ho Deen Siasat Se To Reh Jati Hai Changaizi (Statecraft divorced from Faith to reign of terror leads; Though it be a monarch’s rule or Commoners’ Show).