The power of money

Campaign-finance norms should be implementable

The Election Commission of India deserves considerable respect; it is, after all, one of the few institutions of the Indian state that is universally seen as doing its job, even under difficult circumstances. It is necessary, though, for it to realise when some of its regulations, however well-intentioned, are unenforceable. Such might be the case with the guidelines that have come into force this month on "transparency and accountability in party funds and election expenditure". As the commission rightly points out, there are continuing concerns about the effect of opaque money on the election-financing process. Indeed it is a concern that the financial needs of electioneering exert a malign influence on all policy making; parties are forced to be excessively subservient to the interests of donors who may or may not be known to voters.

The Election Commission's guidelines, which were issued in late August but have only now come into force, attempt to get at this systemic process through attempting to minimise the role of cash in the campaign process. Parties are told to keep up-to-date accounts, at the risk of de-registration. Any cash contributions are to be put into a bank account and put in the books within a week or of the contribution being made. Parties are reminded that they will not be permitted to pay more than Rs 20,000 a day in cash to any individual or organisation. Nor are they allowed to have contributions of more than Rs 20,000 in cash.

While these requirements may appear sensible, they could be seen as going in the wrong direction. The question is: are they enforceable? After all, does not it seem possible that the limit of Rs 20,000 means that "benami", or false transactions, will replace the truth? Currently, many political parties claim that they are contributed to by large numbers of poorer supporters, and, thus, a vast proportion of their financing is below the Rs 20,000 threshold. "Records" of these names may well be kept - in the same way that some deposit schemes keep "records" of names of depositors, none of whom can be identified at later dates. There is also the exemption of "petty sums" donated at rallies - a loophole that parties can easily take advantage of.

The Election Commission needs to take a more high-level view of the problem . For example, one section of the new guidelines says that parties will not be allowed to contribute to their candidates' election campaigns in such a way that the ceiling on those candidates' expenditure is breached. But this is an outmoded way of looking at things in the era of the mass media. It does not capture spending on television advertisements, for example, which could swing several constituencies at once. In other words, rather than acting to prevent the influence of money power, the existing guidelines may act against less wealthy individual candidates, whose spending would be limited - but whose party-backed opponents have no effective limit on their expenditure. The Election Commission needs to seriously consider a more radical, root-and-branch overhaul of campaign and election financing. And its approach should be to find regulations that are equitable and enforceable.