Report No. 170
After considering views expressed by the participants in the seminars and by various persons and organisations in their responses and after perusing relevant literature on the subject, the Law Commission is of the opinion that in the present circumstances only partial state funding could be contemplated more as a first step towards total state funding but it is absolutely essential before the idea of state funding (whether partial or total) is resorted, the provisions suggested in this report relating to political parties (including the provisions ensuring internal democracy, internal structures) and maintenance of accounts, their auditing and submission to Election Commission are implemented.
In other words, the implementation of the provisions recommended in Chapter one Part three should be a pre-condition to the implementation of the provisions relating to partial state funding set out in the working paper in the Law Commission (partial funding, as already stated, has also been recommended by the Inderjit Gupta Committee). If without such pre-conditions, state funding, even if partial is resorted to, it would not serve the purpose underlying the idea of state funding.
The idea of state funding is to eliminate the influence of money power and also to eliminate the influence of money power and also to eliminate corporate funding, black money support and raising of funds in the name of elections by the parties and their leaders. The state funding, without the aforesaid pre-conditions, would merely become another source of funds for the political parties and candidates at the cost of public exchequer.
We are, therefore, of the opinion that the proposals relating to state funding containted in the Inderjit Gupta Committee Report should be implemented only after or simultaneously with the implementation of the provisions contained in this Report relating to political parties viz., deletion of Explanation 1 to Section 77, maintenance of accounts and their submission etc. and the provisions governing the functioning of political parties contained in chapters I and II of Part IV and chapter I of Part III.
The state funding, even if partial, should never be resorted to unless the other provisions mentioned aforesaid are implemented lest the very idea may prove counter-productive and may defeat the very object underlying the idea of state funding of elections.
4.3.5. It is desirable that total state funding should be introduced but on the condition that political parties are barred from raising funds from any other source. In this chapter, we have proceeded on the assumption that only partial instead of total state funding is feasible in the prevailing economic conditions in the country.
4.3.6. In the Inderjit Gupta Committee report on State Funding of Elections also, it has been recommende.-
"6.14 The committee, therefore, sees full justification constitutional, legal as well as on ground of public interest, for grant of State subvention to political parties, so as to establish such conditions where even the parties with modest financial resources may be able to compete with those who have superior financial resources, on a level with a fair chance of success at the hustings."
The committee also emphasised that such funds could not be doled out to independent candidates and that such of the registered parties as had secured recognition as national and State parties under the Symbols Order on the manifest demonstration of their popular support among the electorate for State sunvention.We concur with the suggestion.
220.127.116.11. On the issue as to whether full or partial State funding should be admissible, the said Committee further observed:
"Para 9.1. Given the budgetary constraints and financial stringencies being faced currently by the country, compounded by the recent economic sanctions imposed by certain foreign countries, sparing or diverting from the meagre financial resources of the country at this juncture, huge funds that may be required to provide full State funding to political parties will neither be advisable nor feasible. A harmonious balance has to be struck. Therefore, to being (sic) (read instead "begin") with political parties may have to contend with only partial funding by the State."
The Committee further recommended that for the present, only part of the financial burden of political parties may be shifted to the State. This should be so done that it provides them relief not only in carrying out their electoral activities and meeting partly the cost of essential items of electioneering campaigns of their candidates but also helps them partially in the current administration of their day to day functioning during non-election period.
18.104.22.168. The Committee recommended that, to begin with, State subvention may be given only in kind, in the form of certain facilities to the recognised political parties and their candidates.
22.214.171.124. The Committee underlined the need to curb the mounting expenses of parties and candidates and ostentatious show of money power by them, by placing reasonable restrictions by law in respect of all or any of the following matters:
(i) Wall writings;
(ii) Display of cut-outs, hoardings, banners;
(iii) Hoisting of flags (except at party offices, party offices, public meetings and other specified places);
(iv) Use of more than a specified number of vehicles for election campaigns and fro processions;
(v) Announcements or publicity by more than a specified number of moving vehicles;
(vi) Holding of public meetings beyond the specified hours;
(v) Display of posters at places, other than those specified by the district/electoral authorities.
4.3.7. We reiterate all the recommendations made in the Indrajit Gupta Committee Report subject to the reservations made in para 4.3.4. So far as the Explanation I to section 77 (1) of the Representation of the Peoples Act 1951 is concerned, we have already recommended its deletion.
4.3.8. As a post-script, we may also refer to the report of the Committee on Standards in Public Life (the Neill Committee: Cmd. 4057) submitted on October 13, 1998 by that Committee to the Government of the United Kingdom. They have made several proposals, inter-alia, for regulating the election expenditure as well as for making auditing and accounting rules for political parties.The proposals are generally aimed at encouraging (i) more openness about the sources and use of party funds; and (ii) greater public confidencethatindividualsand organisations were not buying influence with political parties.