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Report No. 170

Chapter III

State Funding

4.3.1. This part of chapter relates to proposal for state funding of elections put forward in the working paper. The working paper had reiterated the proposals contained in the Dinesh Goswami Bill of 1990 which, as has been stated herein before, was based upon the consensus of all the political parties.

4.3.2. It is necessary at the outset to refer to Inderjit Gupta Committee which was appointed by the Parliament to got into the question of state funding. The Committee has also recommended partial state funding of political parties more or less on the lines of the Dinesh Goswami Bill 1990.

4.3.3. Views of participants in seminars considered. Shri Som Nath Chatterjee, who presided over the session devoted to 'Election Expenses and State Funding' in the National Seminar held on 24.1.1999 supported the idea of state funding. (Hew as a member of the said Committee.) Mr. Chatterjee referred to a 1971 Parliamentary Committee known as 'Jagannadha Rao Committee' of which S/Shri. Atal Bihari Vajpayee and L.K. Advani were members besides himself, which Committee had also recommended state funding.

He referred to the deliberations of the Committee appointed by Shri Jayaprakash Narayan, provisions of Dinesh Goswami Bill and to the recommendations and resolutions of the Inter-Parliamentary Council (at which all parliamentarians were represented), held in May 1994.

All of them recommended the idea of state funding. Mr. Chatterjee referred in some detail to the contents of the Inderjit Gupta Committee Report recommending partial state funding of the recognised political parties; both at the national and state levels. The recommendations made, he said, were designed to meet the unavoidable expenditure required to be incurred by each political party though it may not satisfy their total requirements.

Such a course, he said, will help the bona fide candidates. He also expressed himself in favour restrictions being placed upon ostentatious expenditure on elections including on cut-outs, banners, arches, public meetings and so on. According to him, the proposals of the Inderjit Gupta Committee Report represent a good beginning though they do not exclude private funding of the political parties. He also supported the idea of creating a state fund, as recommended by the Inderjit Gupta Committee.

This fund should have a reserve of six hundred crores. The said amount, he said, was fixed keeping in mind the rate of rupees ten per elector. Mr. Chatterjee also stressed the importance and necessity of vigilance by public, media and all other organisations interested in public welfare. Shri K.K. Venugopal, senior Advocate, was also of the opinion that time had come for seriously considering the state funding of elections. He referred to the fact that in several countries such a practice was in vogue. He pointed out that in no case, money as such should be paid to the candidate or to a political party. Only certain material, which was necessary for every political party to convey its message and its programme to the electorate should be provided. If the state funding was in the shape of cash, he opined, millions of candidates would come forward to contest elections only for the sake of money.

He also referred in this connection to the practice in England where free television time was made available by BBC and by independent television companies. Postal communication was also accessible free of charge to the candidates. Council halls are made available for holding the meetings. The cost of printing and compiling of the registers were all paid by the State.He then referred to the French electoral system which he said is the most generous in this respect.Money is not given there directly by the state but pamphlets, leaflets, posters, handbills and other publicity material including election manifestos and statements are printed by the state machinery at the specific request of the candidate. Vehicles including oil and petrol are provided by the State.

Help was extended to the candidate to organise public meetings and public address systems. Radio time and television time was also made available to a candidate free of cost. Turning to India, Mr. Venugopal said that the problems confronting the country were very acute and that election funding on a major scale could not be undertaken at the cost of poverty, primary education, primary health care, population control, clean drinking water, creation of employment and so on.

He opined that any deprivation in these areas would negate the very socialist democratic foundation of the nation. While commending the proposals of the Law Commission in this behalf, he referred to France again where, with a view to preventing a large number of independent candidates from taking advantage of state funding, it has been provided that every candidate receiving State funding shall execute a bond and also furnish a bank guarantee for the financial support extended to him so that in case he got less that 8 per cent of the total votes polled, he would forfeit his bond and money would be recovered from the guarantor

He was of the opinion that such a provision should be made in the Indian law also, if state funding was to be provided. Such a course, he submitted would prevent a host of candidates appearing on the electoral scene and, at the same time, would render great service to democracy by providing a level playing field to all the persons who genuinely desired to serve the nation as representatives of the people.He submitted that the existing professional politicians alone could not represent the people and that it was necessary to bring into existence a new generation of educated individuals who desired to serve the country. One of the participants suggested that it should be open to private individuals and other bodies to make contributions to the Election Fund and that contributions thereto should be exempt from income-tax. While some of the participants wanted the State funding to be restricted to recognised political parties(RPPs), some others suggested that it should be extended to all the candidates. As a matter of fact, there was a sharp division of opinion, in this session, on this question. At the seminar held on 14th November, 1998 too, these proposals had elicited mixed response. At the Banagalore seminar, some of the participants suggested that if the state funding was to be introduced, it must be made conditional upon internal democracy being assured within the political party. To the same effect were the opinions expressed at the Thiruvananthapuram seminar. In the responses received to the working paper, differing opinions were expressed. While some members agreed with by the opponents of this proposal is that such a course would place an unwanted burden on the public exchequer and that unless other proposals relating to maintenance of accounts etc., were also given effect to, state funding should not be resorted to.

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