| Lok Satta is convinced that the national
reform effort should be focused on one clearly defined vital goal, the
achievement of which facilitates all other reforms.
Electoral reform is identified as such
a crucial goal for the following reasons:
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Fair elections are central to a democracy.
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Broad consensus exists on many facets
of electoral reform.
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Parties will find it difficult to justify
status-quo and oppose reform.
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Most electoral reforms can be achieved
by simple change of law or rules.
The following approaches are being followed
to build a viable electoral reform movement
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A clear, well-defined, well-documented
agenda around which there is a consensus.
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Develop capacity for mass mobilization
in at least two or three states, including Andhra Pradesh.
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Sharing of electoral reform agenda, and
the experience of citizens' initiatives for fair elections ( Election Watch)
and good governance(People's Watch) with the best known activists and thinkers
in major States
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Promotion of Election Watch movement in
States due to go to polls: Kerala, Tamil Nadu, West Bengal, Uttar Pradesh,
and Punjab.
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Formation of a national secretariat of
eminent and credible Indians with irrevocable commitment to specific electoral
reforms.
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Link the deepening fiscal crises and other
governance issues to electoral reform, and propagate the message.
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Mobilize student power on the twin issues
of quality higher education, and fair elections for better representation.
Lok Satta believes that the time for
collective action for electoral reforms is ripe now. Given the deepening
fiscal crisis of governments, the increasing political uncertainty and
the unsustainity of status-quo, we have before us a priceless window of
opportunity to achieve electoral and governance reforms in the next few
years. The dynamism of our society, the yearning for change visible all
over, and the relative robustness of the private economy give the nation
the capacity to embark upon electoral and governance reforms.
Problems of First-Past-the-Post
(FPTP) System:
1.Winning in a constituency is the
only source of legitimacy in FPTP system.
2.Broad based Public support is not
recognised if a party cannot win in a constituency.
Local electoral irregularities
are encouraged to win at any cost.
There is incentive
to resort to irregularities locally to win as broad public support
without winning
in a constituency is no use. Conversely, parties have no desire to
appeal to broader
constituency. Nor is there desire to identify candidates worthy of
public office.
3.The gains in a constituency on account
of irregularities are not offset by the risk of
losing public support
elsewhere.
4.A high proportion of winning candidates
obtain less than 50% vote. (Annexure 10
gives the percentage
of votes obtained by winning candidates).
5.New political groups cannot make
an impact in the absence of the capacity to muster
money and muscle power.
6.The system favours entrenched parties
and individuals and stifles reform impulses.
7.The finest citizens are repelled
by the ugly electoral practices, and choose to stay
away from politics, leaving
the field open to the entrenched politicians.
8.Local dynasties perpetuate family
power for generations.
9.Complete change to proportional
representation may lead to weaking of the bond
between people and their
elected representatives.
10.In FPTP System, the party with
the largest vote may have disproportionate presence
in legislature.
This may promote majoritarianism stifling dissert or a party which has
concentrated
presence in a few pockets may fare better than a party with widespread
popular base,
thus distorting verdicts.
Proposal:
Proportional representation
combined with constituency - based election for 50% of the
seats.
a. The
overall composition of the legislature will depend on the proportion of
votes
obtained by the parties.
b.
50% seats are filled by constituency - election.
c.
There shall be two votes; one for the constituency election and the other
for the party
of choice.
Party vote determines the number of seats a party gets. After excluding
the
constituency seats won by the party, the remain seats will be filled from
the party
lists.
d. A
State shall be the unit for proportional representation or lists. All union
territories
together will constitute a unit.
e. A
party shall be eligible for allotment of seats on PR basis only if it obtains
at least
10% of the valid votes in States with 10 or more seats. If the number of
seats is less,
a party shall have to cross a threshold limit as per the formula.
No. of Valid Votes
No. of Seats to be filled
f. As
a party or parties are eliminated for obtaining votes below the threshold,
the seats
shall be divided among the remaining eligible parties as per the following
formula:
(No. of Valid Votes obtained by the party / Total No. of Valid Votes obtained
by all
eligible parties) X (No. of Seats)
g. First,
each party receives one seat for each whole number resulting from this
calculation. The remaining seats are allocated in the descending sequence
of decimal
fractions.
h. Any
seats which a party has won directly in the constituencies are deducted
from this
number, so that the balance number to be drawn from the lists is decided.
i. The
existing reservation provisions will continue for the constituencies as
well as party
lists as per a roster of reservation.
j. If
a party wins more constituency seats than it is entitled to get by proportional
representation, it will retain all constituency seats. The additional number
will be
added to the strength of the legislature on a temporary basis.
(Annexure 11 gives the sample calculation
showing distribution of seats in the proposed PR system combined
with constituency elections).
Citizens'
Campaign for Electoral Funding Reform
It is by now well-recognized
that excessive, unaccounted and illegitimate election
expenditure is the root
cause of corruption. This high and illegal expenditure forces parties
and politicians to extort
money from a variety of sources, legitimizes corruption, encourages
political recruitment
of those willing to spend large amounts of ill-gotten black money,
discourages public-spirited
citizens from contesting, leads to a vicious cycle of corruption,
greed and extortion,
and undermines our democracy. Most political players are victims of
this vicious cycle. The
frequent change of governments and public representatives hardly
makes a difference until
the norms of election funding are altered fundamentally.
It is estimated that about
Rs. 7000 crores is spent by all major parties and candidates in Lok
Sabha and State Assembly
elections over a period of five years in India. In most
constituencies the actual
expenditure incurred is several times the ceiling limits prescribed
by law. The political
system can be sustained only if the returns are about ten times the
investment, considering
the high risk, opportunity cost, the need to maintain an entourage,
the escalating cost of
future elections, the cost of upkeep of the politician and the greed to
amass personal fortunes.
The bulk of the requirement of Rs. 70,000 crores which the political
system needs to survive
is often collected by the vast army of bureaucracy through extortion
and rent-seeking from
citizens. This translates itself as 'rent' or bribe for most public
services, and harassment
of hapless citizens using the power of law and nuisance value. As
rent-seeking employees
out-number politicians by 2000 to one, retention of even a small
collection fee by employees
results in actual bribe collections ten times higher, or Rs.
700,000 crores over five
years. The citizen pays much more on account of the state of
anxiety and uncertainty
in which he is kept to sustain this chain of corruption. People are
forced to cough up bribes
for fear of losing much more if they resist. Clearly, electoral
campaign finance reform
is the key to curbing corruption.
Political activity needs
money. Politics in a true sense is a noble endeavor promoting human
happiness. Our political
system, by not encouraging honest and transparent funding for
legitimate political
activity has made most election expenditure unaccounted and illegitimate.
This in turn is translated
into huge corruption siphoning off money at every level. This
ubiquitous corruption
has altered the nature of political and administrative power and
undermined market forces,
efficiency and trust on a much larger scale. As a result economic
growth is retarded, and
democracy is distorted.
Problems with present
legal provisions.
1.Explanation
1 added in 1974 to section 77 of the Representation of the People Act,
1951 made a mockery of the election expenditure ceiling, by excluding the
expenditure incurred by parties and others from the purview of ceiling
limits.
2.The
income of a political party is exempt from income tax under 13 (A) of the
IT Act.
Parties, in return, are bound by law to maintain accounts regularly, record
and
disclose names of donors contributing more than Rs. 10000 and have their
accounts
audited by a qualified accountant as defined in Sec 288 (2) of the IT Act.
Under 139
(4B) of the IT Act, inserted in 1978, parties shall furnish returns of
income to the IT
authorities. However, there is neither provision for public auditing and
full disclosure,
nor are severe penalties attached to non-compliance. Given the power and
primacy of
parties, the IT authorities are reluctant to act against parties for violations
of law,
despite clear rulings of the Supreme Court
3.Since
1985, companies are permitted to contribute upto 5% of the profit to political
parties. But in the absence of strict disclosure norms backed by severe
penalties for
non-disclosure, both parties and donors find it expedient not to disclose
these
contributions. Donors are afraid of possible political retribution from
other parties.
Parties and donors also do not wish to let the public know the link between
a political
contribution and favours doled out to them by a party in power. Also parties
and
candidates are loath to disclose funding as most expenditure is both illegal
(beyond
ceiling limits) and illegitimate (for buying votes, bribing election officials
and hiring
musclemen).
4.There
are no asset and income disclosure norms applicable to candidates while
contesting and to elected representatives while assuming public office.
In the absence
of public scrutiny and severe legal penalties there are many rags-to-riches
stories in
politics, and the assets of many politicians far exceed the known sources
of income.
Weak laws and ineffective enforcement made political corruption an integral
part of our
system.
5.Even
where laws exist, absence of severe penalties and an effective mechanism
to
enforce them makes them ineffective. We need to dramatically increase the
risks of
non-compliance and make them unacceptable in order to enforce a fair degree
of
compliance. The obligation to disclose should be imposed on the donors
as well as
recipients and the penalties must be very severe for both.
6.Political
activity, electoral contest and people's representation are legitimate
public
activities. If the cost of these activities has to be borne by the candidates
themselves,
or a few donors, then political participation will be limited to those
who can marshal
resources. Two consequences follow: most of the time of politicians will
be spent in
mobilizing resources for political activity; and corruption will be an
inevitable result.
Therefore public funding should be considered as a serious option. However
there are
two problems of public funding: the mechanism devised should be fair, transparent,
practical and acceptable; there should be strict monitoring to ensure that
politicians
do not cheat by using public funding even as they raise unaccounted resources
and
buy their way into public office.
These legal infirmities
made elections a high-cost, high-risk, high-profit investment for many
unscrupulous elements.
The result is an unending spiral of corruption, abuse of office,
electoral malpractices
and mal-administration. Several committees have already made
valuable recommendations
to set right the situation and cleanse our public life. Dinesh
Goswami Committee, Election
Commission, Law Commission, Inderjit Gupta Committee,
National Commission to
Review the Working of the Constitution, and the Supreme Court
have made several insightful
observations. Based on these, the following are the contours of
practical, enforceable,
tangible reform in campaign finance.
Contours of reform
1.Political
activity is a noble endeavour, and citizens and corporate bodies should
be
encouraged to fund legitimate political activity. Toward this end, all
individual
contributions to candidates and parties for political and election activity
should be
exempted from income tax, subject to a reasonable ceiling of say, Rs. 10,000
for
individuals, and 5% of profit for corporate bodies. Individuals may contribute
more, but
tax exemption will be limited to the ceiling of Rs. 10,000.
2.There
should be full disclosure of all individual and corporate contributions
to
candidates or political parties for any political activity. Both the donor
and the
recipient shall be obliged to make full disclosure to the Election Commission
as well
as Income Tax authorities. Penalties for non-disclosure or false-disclosure
should be:
Donors: fine equal to ten times the contribution and imprisonment for six
months
Candidates: disqualification for six years; fine equivalent to ten times
the
undisclosed amount; and imprisonment for at least one year.
Parties: derecognition and deregistration for five years, fine equal to
ten times
the amount not disclosed, and imprisonment of office bearers for three
years
The parties shall file returns every year, and after every election. The
Election
Commission shall get them publicly audited. The candidates shall file an
audited
statement after the election. All information regarding contributions and
expenditure
shall be made public through print and electronic means.
3.The
Explanation 1 under Section 77 of the Representation of the People Act
1951
should be repealed. There should be reasonable ceilings imposed from time
to time,
and all expenditure by parties, candidates and their friends should be
included in the
ceiling limits. Any illegitimate expenditure to give inducements to voters,
bribe officials
or indulge in electoral irregularities will invite fine equal to ten times
such expenditure,
disqualification for six years and imprisonment for three years.
4.Every
candidate shall disclose his income and assets along with those of his
family
members at the time of the nomination. There shall be annual disclosure
of income
and assets of elected legislators and their family members. Non-disclosure
or wilful
false disclosure will invite confiscation of undisclosed properties and
assets,
disqualification for six years and imprisonment for three years.
5.The
Election Commission shall be the final authority to receive statements
of income,
assets and expenditure, their verification and auditing, and determination
of false
disclosure or non-disclosure. The Commission's determination of noncompliance
order on an application or suo motu shall automatically invite penalty
ten times the
amount and disqualification for six years, and in case of parties, derecognition
and
deregistration for five years. Ordinary criminal courts or special courts
appointed for
the purpose will have jurisdiction to try related offences and sentence
the guilty to
imprisonment.
6.There
should be fair, practical, non-discriminatory public funding for candidates
and
parties as follows: indirect public funding to candidates of recognised
parties in the
form of free media time in government and private electronic media mandated
by law,
and supervised by the Election Commission; and mandatory live debates on
electronic media before the elections, supervised by the Election Commission
or
agencies appointed by it; direct public funding to candidates or political
parties
obtaining votes above a threshold limit of, say 10% of the valid votes
polled in the
constituency, with the candidate / party being reimbursed a fixed amount
of Rs. 5 or
Rs 10 for every vote obtained. Recognised political parties will be given
an advance of
50% based on the votes polled in the earlier election.
These reforms are vital
to cleanse our electoral process, but are not enough to eliminate
corruption. Decentralization
of governance, instruments of accountability, and swift and
exemplary punishment
to the guilty are the other necessary reforms needed to curb
corruption. But campaign
finance reform is indisputably the vital starting point in our fight
against corruption.
Lok Satta's initiative
There is an impressive
consensus in our country in favour of these campaign finance
reforms. All parties
have publicly committed themselves to these reforms. All governments
have promised them. The
Parliament, in its golden jubilee special session in 1997 has
unanimously resolved
to carry out meaningful electoral reforms. Despite these public
commitments, the Parliament
could not legislate these reforms on account of the sheer
inertia of the political
system and the fear of parties that they will be held to account if
campaign finance reforms
are introduced.
As the political system
is in logjam, the civil society needs to seize the initiative and compel
reform. Campaign finance
and electoral reform is too important to be left to politicians alone.
People cannot be idle
spectators in the face of mounting corruption and growing
disenchantment with the
political process. Lok Satta has therefore decided to launch a civil
society initiative to
mobilize public opinion infavour of campaign finance and electoral reform.
The citizens campaign
for Electoral Reform envisages the following steps:
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Prepare an acceptable statement
of reform objectives
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Identify and assemble a core group of
15-20 eminent and reputed Indians of unimpeachable credentials to
finalisea reform agenda and to provide leadership to the
campaign
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Obtain endorsement of a large number of
reputed Indians in all walks of life.
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Signature campaigns in several States
in support of campaign finance reform.
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A media campaign including public broadcasting
capsules and advertisements
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Mailing of letters (ordinary as well as
email) in an agreed format to the president, prime minister, presiding
officers of both houses and leaders of opposition in both houses
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Public meetings in State capitals and
district towns
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Representations to high functionaries
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Other mass-mobilization techniques
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