Indias Supreme Court Committee On Political Freebies Analysis And Implications

The Supreme Court of India has taken a significant step in addressing the contentious issue of political freebies by forming an expert committee to examine their impact on the economy and electoral processes. This development comes amid growing concerns about the fiscal and social implications of political parties distributing free goods and services ahead of elections.

Background of the Supreme Court's Intervention

The Supreme Court's involvement in this matter originated from a Public Interest Litigation (PIL) filed by Ashwini Upadhyay, seeking directions to regulate freebies distributed by political parties. On August 3, the Court decided to establish an expert group to study the effects of these political freebies on the economy. The matter was subsequently posted for hearing on August 11.

A bench comprising Chief Justice NV Ramana and Justices Krishna Murari and Hima Kohli directed the Central government, Election Commission, senior advocate and Rajya Sabha MP Kapil Sibal, and the petitioners to submit their suggestions within seven days regarding the composition of this expert body.

Composition of the Expert Committee

The proposed committee is envisioned to include representatives from various key institutions:

• Government officials
• Opposition parties
• Niti Aayog
• Election Commission
• Finance Commission
• Reserve Bank of India (RBI)

This multidisciplinary approach suggests the Court's intention to obtain comprehensive perspectives on the complex issue of political freebies from different stakeholders in the Indian political and economic landscape.

Judicial Perspectives on Freebies

During the hearings, several judges expressed strong concerns about the impact of political freebies. Justice Gavai, in particular, made notable observations about the adverse effects of freebies, suggesting they might discourage work and foster dependency. He remarked during the proceedings, "Rather than permitting [homeless individuals] to be a part of the mainstream society by contributing to the development of the nation, are we not creating a class of parasites?"

The judge highlighted specific instances where agricultural laborers in Maharashtra were reportedly reluctant to work due to free rations and other benefits announced before elections. Despite these reservations, Justice Gavai acknowledged that the right to shelter is a fundamental right and emphasized the need to integrate the homeless into mainstream society.

The Court's Questions to the Government

The Supreme Court posed direct questions to the Central government regarding its approach to the freebie issue. The bench, headed by Chief Justice N.V. Ramana, queried the government on why it couldn't form its own committee to examine the impact of freebies promised by political parties to induce voters. The Court also suggested that the government could call for an all-party meeting to address the issue.

Solicitor General Tushar Mehta, representing the Centre, responded that the government would assist in every possible way and could provide statistics and other information relevant to the case. Mehta emphasized that "a line should be drawn, where somebody should tell 'please do not do this'." In response, Chief Justice Ramana questioned who would head such a committee, noting that political parties rather than individual candidates dominate electoral processes.

Senior advocate Vikas Singh, representing the petitioner, suggested that a retired Supreme Court judge, such as Justice R.M. Lodha, should be appointed as the chairman of any committee examining freebie issues.

The Debate: Welfare vs. Populism

The discourse around political freebies reflects a fundamental tension between welfare measures and populist politics. While welfare measures are acknowledged as crucial for uplifting economically weaker sections, there are concerns about reckless implementation without proper financial backing.

Advocate Prashant Bhushan, appearing for one of the petitioners, countered the Court's concerns by stating that most people in India are willing to work if employment opportunities are available. This perspective highlights the different viewpoints on whether freebies primarily create dependency or address genuine needs in the absence of sufficient employment opportunities.

Potential Fiscal and Economic Implications

The Court has expressed concerns that excessive reliance on government handouts could have several negative consequences:

• Weakening individual self-reliance
• Creating unsustainable burdens on public finances
• Leading to fiscal distress
• Distorting labor markets
• Fostering over-dependence on government aid rather than productive employment

These concerns align with recommendations from the Economic Advisory Council to the Prime Minister (EAC-PM), which has suggested discouraging open-ended freebies in favor of investments in infrastructure, health, education, and social sectors that yield long-term benefits and sustainable growth.

Proposed Solutions and Recommendations

Several approaches have been suggested to address the challenges posed by political freebies:

1. Formation of an Expert Committee: As proposed by the Supreme Court, this committee would analyze the broader implications of freebies on the economy and democracy.

2. Prioritizing Investment Over Freebies: Redirecting resources toward infrastructure development and social sectors that provide sustainable benefits.

3. Amending the FRBM Act: Proposing amendments to the Fiscal Responsibility and Budget Management (FRBM) Act to include all sources of debt and off-budget financing, which would enhance fiscal transparency and ensure democratic accountability.

4. Empowering the Election Commission of India (ECI): Strengthening the ECI to implement the Model Code of Conduct more effectively.

Historical Context: Live Streaming of Proceedings

In a significant development, the Supreme Court of India made history by beginning to live stream its orders on political freebies. This occurred on the last working day of outgoing Chief Justice of India N.V. Ramana. The Court's hearings and judgments on approximately 20 cases were live streamed through the National Informatics Centre (NIC) webcast portal, marking a first in the country's judicial history.

Expert Criticisms of the Committee Approach

Despite the Supreme Court's initiative, many senior law experts and advocates have expressed skepticism about the effectiveness of the committee approach. Senior counsel Rajeev Dhavan questioned what impact such a committee could have on the fundamental issue of freebies' effect on elections, wondering how the committee would answer this question.

Most senior law experts believe that the issue will ultimately end with the formation of the committee without substantial resolution, an approach they describe as "burial by committee." This perspective suggests that the committee formation may serve more as a delaying tactic than a genuine attempt to address the complex issues surrounding political freebies.

The Broader Context: Freebies in Different Sectors

While the current focus is on political freebies, the concept of freebies extends to various sectors. In a different legal context, the Supreme Court has addressed the issue of freebies in the pharmaceutical industry. The Court has ruled that pharmaceutical companies cannot claim freebies given to doctors as expenditure, noting that such practices create a "perpetual publicly injurious cycle" that enhances drug prices. This decision prohibits pharmaceutical companies from claiming as tax deductible expenses those expenditures that are prohibited under the Medical Council Regulations.

Conclusion

The Supreme Court of India's formation of a committee to examine political freebies represents a significant judicial intervention in a complex and contentious issue. The Court's concerns about dependency, fiscal discipline, and democratic accountability reflect the serious challenges posed by the proliferation of freebies during elections.

While the committee approach has its critics who view it as potentially ineffective, it nonetheless demonstrates the judiciary's recognition of the need to address the growing trend of political freebies. The outcome of this judicial examination could have far-reaching implications for electoral politics, public finances, and social welfare in India.

The debate surrounding political freebies highlights the tension between immediate electoral gains and long-term sustainable development, between welfare measures and populist politics, and between individual rights and collective fiscal responsibility. As the committee begins its work, these fundamental questions will require careful consideration and balanced solutions.

Sources

1. SC forming panel to examine issue of freebies by political parties is 'burial by committee': Experts
2. 'Why can't Centre form committee, call for all-party meeting', SC on PIL opposing freebies
3. Freebies in Indian context: Politics & Election
4. Are Freebies Creating a Class of Parasites? SC Raises Concern
5. In a first, SC to live stream ruling on political parties giving freebies
6. Pharma companies cannot claim freebies given to doctors as expenditure: SC