So Much
for Transparency !
Economic Times ( 03 Jan )
carries following news :
“ FM Details
Nuts & Bolts of Bonds for Poll Funding “
HIGHLIGHTS :
·
Donors can buy these bonds and give them to the party of their
choice.
·
The party can en-cash them through designated bank accounts
within 15 days.
·
The bond will be a bearer instrument in the nature of a promissory note
that's issued by select State Bank of India branches to valid account holders
·
Electoral bonds would be issued/purchased for any value in multiples of
Rs 1,000, Rs 10,000, Rs 1 lakh, Rs 10 lakh and Rs 1crore from specified
branches of SBI
·
The bonds will be available at
the designated SBI branches for 10 days each in January, April, July and October
as specified by the Centre. This will increase to 30 days in the year that Lok
Sabha elections are due.
·
They will not earn any interest and only Indian citizens or bodies incorporated in the country can
purchase them. Strict conditions will be put in place to check misuse and
prevent financial wrongdoing.
·
The purchaser would be allowed to buy electoral bonds only on due
fulfilment of all know your customer (KYC) norms and by making the payment from a bank account
·
The electoral bond will have a life of only 15 days
during which it can be used for making donations only to parties registered under Section 29A of
the Representation of the Peoples Act, 1951
·
The 15-day period has been prescribed to ensure
that they do not become a parallel currency.
* Only political parties that got at least 1% of the total votes polled in either the last
assembly
or general election will be eligible to accept electoral bonds, ruling out
those formed after the last poll. This is to
prevent the floating of bogus parties just
before an election to collect funds.
·
Although the buyer
has to fulfil KYC norms, the bonds
will not carry the person's name.
·
Since the name of the payee will not be disclosed to the Election
Commission, donations will remain anonymous.
·
This will help in a
scenario in which donors
may be hesitant to be identified as supporting a particular party.
·
Every political
party will file before Election Commission return as to how much money has come through electoral
bonds
·
The bond shall be en-cashed by
an eligible political party only through a designated bank account with the
authorised bank (SBI)
·
The government intends to have
just a few designated SBI branches, most
likely only one in a state, for issuing
electoral bonds, sources said. No other bank
can
issue the bonds
·
The bonds will also put a stop to funds being
diverted within political parties, the government hopes.
====================================================
MY
TAKE :
·
Since “ Something is better than nothing “ , we must
welcome this initiative
·
But ,
imagine the following scenario :
# Mr
Antani of Alliance Industries , buys bonds worth Rs 5 crores from his
company’s SBI bank account , after due KYC
verification.
He buys 2 bonds , one of Rs 3
crore and another of Rs 2 crore
Having used his Company’s
bank account, this entry would have to appear in
his
Company’s year-end Balance Sheet / Annual Report ( a document in public
domain ) – under heading “ Purchase of Electoral Bonds
“ – which is visible to
all
#
Mr Antani meets , General Secretaries of 2 political parties and
hands over those papers , IN PERSON (- not
surprising , considering that the
bond does not carry the donor’s name – and of course, you want to be
remembered ! )
So, each of those General Secretaries, know how much bond money his
party
got from Alliance Industry
But he has no idea of how much donation
Alliance Industry gave to how many
other parties – until he looks up that Balance Sheet !
Now he can guess , who
got and how much from Alliance
Industry ! And he will remember while
taking decisions
# Of course, the following will
not know who gave how much donation to which
political party :
Ø En-cashing Bank ( of the Political Party
)
Ø Election
Commission
Ø Public
As if this was not enough , the
amended Income Tax Act reads :
“ Any contributions received by way
of electoral bond shall be excluded from
reporting “
Does anyone have any doubt that
the whole idea behind introduction of Electoral
Bonds is ,
·
not to introduce
TRANSPARENCY , but
to reinforce existing ANONYMITY
·
to ensure
that no relation ( Quid
pro Quo ) can ever be established between a donor and a government
largesse to that donor
·
to ensure that neither the Income Tax
department , nor the Election Commission ,nor any watchdog organization ( such
as ADR ), nor the citizens can examine the records of political parties ( Who gave
How much to Whom and spent Where ! )
·
to ensure that cash donations of Rs 2000
or less , can continue un-abated
=======================================================
Could the NDA government done anything different to bring about true
TRANSPARENCY , to the entire issue of Political Funding ?
YES , if it had the courage to implement my following blog / email [
06 July
2017 ] :
====================================================
Thursday, 6 July 2017
Economic Times ( 06 July ) carries a report titled
:
“ Political Funding Next on Radar :
FM “
As per this report , Shri Jaitley said :
=====================================================
“ We are looking at some major steps to be announced by which we
want to cleanse the entire political
funding in India
For the last 70 years, the world’s
largest democracy has survived on funding which really brings no credit to the
democracy and I think it has been the prime minister’s insistence that this has
to be one of the subjects that the government has to take up now as a top priority “
We are aware of some modest reforms
( electoral bonds / cap on cash payments ) that Shri Jaitley introduced in the last
budget
But no one believes that these
reforms go far enough ( - including CEC ! )
Millions of Indians ( but no
political party ) want ALL donations ,
irrespective of the amount involved , to be by official / transparent channels
( cheque / Online Payment etc ) , and want mandatory
filing of INCOME / EXPENSE statements with CEC !
I request Shri Jaitleyji to consider following
suggestion :
STRUCTURE
· No
direct donations ( even Rs 5 )
by anyone to any Political Party or to any Political Leader ( even as birth-day
gift ! )
· Creation
of a CENTRAL ELECTION FUND ( CEF )
, controlled / administered by the Central Election Commission
· Donations
can only be given to CEF – and
only by cheque / online etc , quoting Aadhar number
· Donations
will get tax exemption as CSR
· CEC will publish , on its web site , a
continuous / dynamic / daily ACCOUNT of amounts received ( with Aadhar No of each
donor ) and amounts spent / disbursed by CEC to Political Parties / Candidates
( with full details of each )
· From CEF ,
Election Commission will distribute FUNDS to political parties for fighting
elections / other expenses , on predetermined ‘ Occasions ‘
PROCESS
· Funding of Political Parties by CEC ( from CEF ) , can be made as per
following two alternatives :
[ A ]
AFTER THE ELECTION (
CANDIDATE – based Reimbursements ) :
# After each Election ( Central
/ State / Municipal ) , ALL candidates contesting the election ( including
independent candidates ) , shall submit to CEC , a STATEMENT of EXPENSES incurred in fighting the election.
Even if a group of parties have come
together to fight the election ( MahaGathBandhan ), each candidate will get
linked to ONE party only
# Statement will be as per
format decided by CEC , giving
category-wise expense details ( all payments listed in the statement , must be
through legal / official channels , such as Cheque / Electronic Bank Transfer /
Mobile Wallets etc )
# There will be UPPER LIMITS of REIMBURSEMENT for each category of
expense and an overall limit
# The statement will also show
the “ Sources of Funds “ (
with full details such as OWN or borrowed from
CLOSE RELATIVEs , with names )
# Actual amount to be
reimbursed to each candidate , will be computed based on a number of factors ,
main factor being the “ percentage of popular
votes polled “ by that candidate ( no
reimbursement for those candidates who get less than 5 % of popular vote )
# Actual re-imbursements made
by CEC , shall not be counted
as INCOME of that candidate , for Income Tax purpose
[ B ]
BEFORE THE ELECTION (
PARTY – wise ADVANCES ) :
# Before each election , All recognized Political Parties will
get ADVANCES from CEF ,
computed using aTRANSPARENT , mathematical formula , based on following factors :
# FACTORS with POSITIVE
WEIGHTAGE :
· In
all the elections since independence ( Central + States + Municipal ) , percentage of popular votes polled by
each party in those elections along with the percentage
of seats won by each party
· Number
of years for which the party has been recognized by CEC
· Cumulative
number of “ Days “ ( not months or years ) , each
party was in power ( Centre + States + Municipality ) since
independence
· No
( or percentage ) of seats “ won “
in each election
# FACTORS with NEGATIVE WEIGHTAGE :
· No
of MPs / MLAs having criminal cases pending
against them
· No
of times candidates / parties were “ warned “
by CEC ( for any reason )
· No
of years for which Annual Return NOT filed
with EC
· No
of candidates / Legislators convicted by a Court
DEAR SHRI JAITLEYJI :
Above mentioned suggestion , is by no
means , comprehensive
You may want to consider a HYBRID MODEL which is a combination of
the alternatives listed above
It is important that all the figures
/ data used in the FORMULA ,
are supplied only by the Election
Commission and theSpeakers of
various legislatures – and made public
Since there is no way political
parties will reach a consensus on
my suggestion , best way would be to publish an onlineSURVEY QUESTIONNAIRE and ask citizens to vote / rate ,
against each item of suggestion and then publish theFINDINGS ( on ALL government web sites ) , on a continuous
basis
It would be too much to expect the
Political Parties to accept this reform without building up pressure from 800 +
million voters .
You may even consider a REFERENDUM !
04 Jan
2018
www.hemenparekh.in / blogs
Insightful article.
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