Stop the Flow of Private Funds to Polls

Contained in the paper, Governance Needed to Attain the Most Efficiently Competitive Economy.

Dr. Sankarshan Acharya
University of Illinois (U.S.A.)
and Research Center for Finance and Governance (India)

September 11, 2011

I have made a proposal to the Indian and US governments for stopping the flow of private funds to polls as a strategic necessity for democracies to thrive. The Anna Hazare anti-corruption movement for an Ombudsman (Jan Lokpal) is basically the independent system of prosecution of corrupt officials prevailing in developed countries. This system has not proven to be sufficient, though necessary. My recent memo on this issue to the Indian leaders is dated April 17, 2011. My memos have emphasized fundamental electoral reforms because an independent prosecution system (that the Jan Lokpal will be) is insufficient, judging from failure of developed economies despite having independent prosecution systems.

Mr. Rahul Gandhi has aleady echoed my memo in the Indian Parliament on August 26, 2011 (see NDTV news below).

I have faxed to the leaders of India and USA a formal research paper Governance Needed to Attain the Most Efficiently Competitive Economy, dated September 9, 2011, which elicits a structure of constitutional governance necessary for democracies to thrive, if not prosper amid stability. This paper shows how to develop the most efficiently competitive economy and argues about the necessity of stopping the flow of private funds to polls and of government funding of elections. The Indian government seems to have taken the research paper and proposal very seriously and urgently. It wants electoral reforms to stop the flow of black money (see Hindustan Times news dated September 12, 2011) to preempt the anti-corruption crusader Mr. Anna Hazare taking up such issues.

Mr. Hazare has not talked about electoral reforms in terms of stoppage of flow of private funds to polls. He has raised punitive measures like right-to-recall and no-to-all-the-above candidates contesting for an electoral seat. Such punitive measures will not be needed if fundamental electoral reforms are made seriously as per the proposals.

I hope the other constitutional democracies (especially the U.S.) will follow the lead of the Indian government.


Full text of Rahul Gandhi's speech in Parliament

NDTV Correspondent, Updated: August 26, 2011 14:22 IST

New Delhi: 
Madam Speaker,

I have been deeply distressed at the developments of the last few days. Many aspects of the situation have caused me anguish.

We are all aware that corruption is pervasive. It operates at every level. The poor may carry its greatest burden but it is an affliction that every Indian is desperate to be rid off. Fighting corruption is as integral to eliminating poverty as is Mahatma Gandhi NREGA or the Land Acquisition Bill. Yet it is equally imperative to the growth and development of our nation.

Madam Speaker, we cannot wish away corruption by the mere desire to see it removed from our lives. This requires a comprehensive framework of action and a concerted political program supported by all levels of the state from the highest to the lowest. Most importantly, it requires firm political will.

Madam Speaker, in the past few years I have travelled the length and breadth of our country. I have met scores of countrymen, rich and poor, old and young, privileged and disempowered who have expressed their disillusionment to me. In the last few months, Annaji has helped the people to articulate this same sentiment. I thank him for that.

I believe that the real question before us as representatives of the people of India today is whether we are prepared to take the battle against corruption head on? It is not a matter of how the present impasse will resolve, it is a much greater battle. There are no simple solutions. To eradicate corruption demands a far deeper engagement and sustained commitment from each one of us.

Witnessing the events of the last few days it would appear that the enactment of a single Bill will usher in a corruption-free society. I have serious doubts about this belief.

An effective Lok Pal law is only one element in the legal framework to combat corruption. The Lok Pal institution alone cannot be a substitute for a comprehensive anti-corruption code. A set of effective laws is required. Laws that address the following critical issues are necessary to stand alongside the Lok Pal initiative:

(1) government funding of elections and political parties,
(2) transparency in public procurement,
(3) proper regulation of sectors that fuel corruption like land and mining,
(4) grievance redress mechanisms in public service delivery of old
age pensions and ration cards; and
(5) continued tax reforms to end tax evasion.

We owe it to the people of this country to work together across party lines to ensure that Parliament functions at its optimum capacity and delivers these laws in a just and time bound manner.

We speak of a statutory Lok Pal but our discussions cease at the point of its accountability to the people and the risk that it might itself become corrupt. Madam Speaker, why not elevate the debate and fortify the Lok Pal by making it a Constitutional body accountable to Parliament like the Election Commission of India? I feel the time has come for us to seriously consider this idea.

Madam Speaker, laws and institutions are not enough. A representative, inclusive and accessible democracy is central to fighting corruption.

Individuals have brought our country great gains. They have galvanized people in the cause of freedom and development. However, individual dictates, no matter how well intentioned, must not weaken the democratic process. This process is often lengthy and lumbering. But it is so in order to be inclusive and fair. It provides a representative and transparent platform where ideas are translated into laws. A tactical incursion, divorced from the machinery of an elected Government that seeks to undo the checks and balances created to protect the supremacy of Parliament sets a dangerous precedent for a democracy.

Today the proposed law is against corruption. Tomorrow the target may be something less universally heralded. It may attack the plurality of our society and democracy.

India's biggest achievement is our democratic system. It is the life force of our nation. I believe we need more democracy within our political parties. I believe in Government funding of our political parties. I believe in empowering our youth; in opening the doors of our closed political system; in bringing fresh blood into politics and into this House. I believe in moving our democracy deeper and deeper into our villages and our cities.

I know my faith in our democracy, is shared by members of this House. I know that regardless of their political affiliation, many of my colleagues work tirelessly to realize the ideals upon which our nation was built. The pursuit of truth is the greatest of those ideals. It won us our freedom. It gave us our democracy. Let us commit ourselves to truth and probity in public life. We owe it to the people of India.

Government fast-tracks polls reforms to beat Team Anna
Nagendar Sharma, Hindustan Times
New Delhi, September 12, 2011

In a bid to put its electoral reforms agenda on the fast track and seize the initiative from social activist Anna Hazare and his team, the government will call an-all party meeting in mid-October on the subject. The Prime Minister’s Office (PMO) has directed the law ministry to evolve a political consensus at the earliest” on its proposal to keep the “election arena free from persons with criminal backgrounds”.

The move comes at a time when Hazare and his team have said that after the lokpal bill, their next campaign will be on electoral reforms.

The government, keen to avoid a repeat of Hazare’s agitation on the lokpal bill, has decided to go-ahead with its agenda to decriminalise the electoral system and check the flow of black money in elections.  

“Following the PMO’s advice, we are in the process of finalising the date and agenda for an all-party meeting in mid-October, keeping in mind that it is a month of festivals,” said a law ministry official.

The ministry, in its note to the cabinet earlier this month, proposed to amend the existing law by disqualifying candidates against whom courts had framed charges for having allegedly committed offences punishable with a of minimum of five years’ imprisonment.

The ministry, in its list of specified offences under the IPC and the Prevention of Corruption Act, however, provided a safeguard against the misuse of the provision, saying “charges should have been framed by a competent court, at least one year prior to the date of issue of the election notification.”

The proposal, initiated by former law minister M Veerappa Moily and taken forward by his successor, Salman Khurshid, also aims to plug the existing loophole of allowing candidates convicted for heinous crimes, to continue contesting elections by seeking stays on lower court verdicts from higher courts.

“A person convicted of having committed an offence under the new specified offences, shall be disqualified from being chosen as an MP or an MLA until he gets acquitted from a higher court of law,” the proposal states.