New Delhi : Days after the presentation of the Electoral Bond scheme before the Parliament, Finance Minister Arun Jaitley on Sunday opined that the concept is necessary to envisage the promotion of clean money and transparency in the process of political funding.
In a blog post titled “Why Electoral Bonds are Necessary”, Jaitley said cash donations contain an element of anonymity, which needs to be eliminated to cleanse up the political funding mechanism.
“The conventional system of political funding is to rely on donations, which come from a range of sources from political workers, sympathisers, small business people and even large industrialists. The conventional practice of funding the political system was to take donations in cash and undertake these expenditures in cash. The sources are anonymous or pseudonymous. The quantum of money was never disclosed. The present system ensures unclean money coming from unidentifiable sources. It is a wholly non-transparent system,” he said.
Jaitley, in retrospection of the present system of political funding, stated that despite elections being the most crucial segment of a Parliamentary democracy like India, the country lacks a transparent political funding system.
“The round-the-year functioning of political parties involves large expenditure. Parties run offices throughout the country. Staff salaries, travelling expenses, establishment cost are regular expenditures of political parties. There has not been a single year where election either for the Parliament or State Assemblies has not been held. Besides expenditure of individual candidates, political parties have to spend money on election campaigns, publicity, tours, travels and election-related establishments. These expenditures run into hundreds of crores. Yet, there has not been a transparent funding mechanism of the political system,” he claimed.
Highlighting the amendments made to the Income Tax Act under the leadership of former Prime Minister Atal Bihari Vajpayee, Jaitley said the introduction of a provision that would give a tax advantage to the donor was done to encourage cheque donations. However, it was seen that donors were reluctant to disclose the details of the quantum of donation given to a political party, fearing consequences from political opponents.