Shaken, stirred

NEW DELHI: In what appears to be a monumental verdict delivered just months ahead of the Lok Sabha polls, the Supreme Court scrapped the Centre’s electoral bonds scheme of anonymous political funding, terming it ‘unconstitutional’. The CJI-led bench also held as invalid the amendments made to the Representation of the People Act, the Companies Act, and the Income Tax Act, which violated the voters’ right to information about political funding under Article 19(1)(a) of the Constitution. Maintaining that the 2018 scheme was violative of the constitutional right to freedom of speech and expression and right to information, a five-judge Constitution bench struck down the Centre’s contention that it was meant to bring about transparency and curb the use of black money in political funding.

As we all are much too aware, political contributions are akin to a ‘seat at the table’ for the donor. The enhanced access to legislators translates into influence over policymaking, which sets a very dangerous precedent. The prospect of an economically affluent individual or institution making a huge financial contribution to political parties, raises the possibility of quid pro quo arrangements due to the nexus between money and politics. Bagging anonymous and exorbitant funding without any limits allows political parties to use that money for any purpose, not just the election expenditure.

The money trail spawned by the introduction of electoral bonds was analysed by the Supreme Court, which said that the majority of the anonymous financial contributions through such bonds were made to political parties in power, with the biggest gainer being the ruling BJP.

The annual audit reports of political parties from 2017-18 to 2022-23 showed the party-wise donations received through electoral bonds. Of the Rs 12,000 crore, the BJP received the lion’s share of Rs 6,566.11 crore during this period, while the Congress got Rs 1,123.3 crore. The TMC received in its kitty Rs 1,092.98 crore in the same period. Over 50% of the bonds sold were in the one crore denomination during this period. Having said that, despite the apex court striking down the electoral bond scheme, there are certain questions that need to be answered.

For one, can the public really know which individual or corporate entity contributed how much through these bonds, and to which political party. The problem is that as per the design of the scheme, each bond by itself is not uniquely traceable and the bonds are of mixed denominations. It may also be possible that a bond may have changed many hands before donations. This seems ironic when one considers that these bonds were brought in to solve the earlier problem of massive amounts of cash and black money used to finance elections.

Unfortunately, revealing the links between the donors and recipients renders the donors vulnerable to political vendetta. Any disclosure of the identity of who financed a political rival may end up giving incumbent administrations the ability to target donor enterprises or the wealthy individuals involved. You also need to ask whether greater transparency by itself can influence the disparity in donations towards parties in power. Alternatively, one could consider the option of electoral trusts which can receive contributions from Indian citizens and corporations and distribute them to registered political outfits. What can also be mulled is the potential of public financing of election expenses, with states footing the bill.