The growing trend of offering freebies in elections raises significant concerns about financial sustainability, governance and its impact on voters’ mindset
A major factor contributing to the success of the respective political party in the just concluded elections in Maharashtra and Jharkhand was freebies – an acronym for “something given free of charge” – particularly those targeted at women. In Maharashtra, the BJP-led Mahayuti alliance launched the Ladki Bahin cash benefit scheme that offered Rs 1,500 a month to every woman with a family income of less than Rs 2,50,000 annually, in the age bracket of 21 to 65 years.
The amount was subsequently increased to Rs 2,500 per month. In Jharkhand, under Mukhyamantri Maiyan Samman Yojna (MMSY) Hemant Soren’s JMM-Congress-RJD government had initially promised to give Rs 1000 per month to all women in the age group 18-25 years. The amount was later increased to Rs 2500 per month.
The domineering role of freebies in winning elections is visible in almost every State Assembly election held since 2020 when former Delhi Chief Minister Arvind Kejriwal came up with this brand of politics followed by Punjab in 2022 where the Aam Aadmi Party or AAP promised depositing Rs 1000 per month in the account of every woman aged 18 or above. In Karnataka elections held in early 2023, Congress had promised five guarantees including the much trumpeted Gruha Lakshmi under which every woman head of a house gets Rs 2000 a month. In elections held later in 2023, in Madhya Pradesh, BJP promised Rs 1,250 per month under Ladli Behna Yojana; the amount to be gradually hiked to Rs 3,000 per month. In Chhattisgarh, it promised Rs 12,000 per year to married women under the ‘Mahtari Vandan Scheme’.
In Odisha, under the Subhadra Yojana’, the BJP gives eligible women Rs 10,000 per year, in two instalments of Rs 5,000 each. In future elections, expect all parties to offer such freebies. Already, in the budget for 2024-25, Delhi finance minister Atishi announced the Mukhyamantri Mahila Samman Yojana (MMSY) under which, the AAP government will give Rs 1000 per month to all the women above the age of 18 in the national capital. Now, Arvind Kejriwal has announced six Revdis (another name for freebies) including free power, free water, free education, free healthcare and pilgrimage for the elderly. Freebies win elections but these lead to a host of negative outcomes. The most damaging is the abetment to corruption.
The Union Government’s standards of financial propriety lay down inter alia that “no authority shall exercise its powers of sanctioning expenditure to pass an order which will be directly or indirectly, to its advantage; and the expenditure from public moneys should not be incurred for the benefit of a particular person or a section of the people unless a claim for the amount could be enforced in a court of law or the expenditure is in pursuance of a recognised policy or custom”. The reckless spending of the taxpayer’s money on freebies is neither a recognised policy nor is sanctioned in a court of law.
It is blatant financial irregularity that amounts to bribing voters using public money solely for gaining advantage in electoral politics. Such a corrupt practice is much worse than the one that involves an individual candidate distributing cash using his own money to garner votes. Second, unlike ‘normal’ budget expenses which are planned and backed by well-orchestrated efforts to garner revenue, additional financial liabilities imposed by the freebies promised in the election manifesto affect the budgetary position of the State in a totally ‘uncontrolled’ and ‘unplanned’ manner. There being no corresponding revenue generation against this liability (this being unplanned), this will be at the cost of slashing other essential expenditures including development.
Alternatively, this will result in additional borrowings and the resultant increase in debt to an unsustainable level. In Punjab, the freebies promised by AAP led to an additional expenditure of about Rs 20,000 crore per annum. Unable to foot the bill from its budget, Chief Minister Bhagwant Mann had to approach the Central government to help it raise around Rs 50,000 crore. In Delhi, giving Rs 1000 per month or Rs 12,000 annually to each woman above 18 years for a total of 6.7 million women would cost the exchequer Rs 8000 crore per annum.
Already, the State government faces a fiscal deficit or FD – excess of total expenditure over total revenue – of Rs 18,000 crore during 2024-25 which is 80 per cent higher than the FD for 2023-24 at Rs 10,000 crore. This is despite a steep reduction of over 30 per cent in capital expenditure. The situation has come to such a pass that CM Atishi has recently forwarded a request to the Centre seeking a loan of Rs 10,000 crore from the National Small Savings Fund (NSSF). In Karnataka, the five guarantees have punched a hole of over Rs 60,000 crore a year in the State budget leading to a doubling of its FD to over Rs 122,500 crore. The precariousness of the situation can be seen from a comment by the Deputy CM ‘The government has no money to give to the MLAs for carrying out development work; courtesy the poll guarantees’.
In MP, at the current rate of Rs 1250 per month to 12.5 million beneficiaries, the Ladli Behna Yojana costs the state exchequer about Rs 18,750 crore per annum. This will go up to Rs 45,000 crore per annum as the quantum of assistance eventually goes up to Rs 3,000 per month. In Maharashtra, the Ladki Bahin Scheme will dent the State exchequer by Rs 46,000 crore annually.
Other states Jharkhand, Odisha etc are also feeling the pricks of promised freebies. Third, unlike a normal welfare scheme which has a sunset date, the freebies offered by winning parties have none. So, these will continue to be given ‘eternally’ – no matter which party rules – making perpetual holes in State budgets.
Fourth, the money for freebies comes from taxpayers’ pockets (‘future’ tax payers in case, the government borrows). When they know that taxes are used to give doles to all and sundry, it may even trigger non-compliance amongst them.
Finally, assured of financial help to meet most of their basic needs ‘perpetually’, the freebies cult is changing the mindset of people in a way that makes them complacent towards work. This undermines the very foundation of economic growth.
Left to themselves, political parties will never shun freebies. Can the Supreme Court (SC) force them?
In an order in S Subramaniam Balaji vs the Government of Tamil Nadu & Ors in July 2013, the SC had observed that the distribution of freebies of any kind influences all people. “It shakes the root of free and fair elections to a large degree.” Yet, it held “The promises in the election manifesto cannot be construed as ‘corrupt practice’ under the Representation of People Act (RPA), or any other prevailing law and, hence, distribution of freebies can’t be stopped when the ruling party uses public funds for this purpose through the passage of Appropriation Acts in the state Assembly”.
The SC hasn’t changed its stance even as on January 25, 2022, hearing a PIL on ‘freebies’, it observed “This is no doubt a serious issue, budget for freebies is going above the regular Budget. This disturbs the level playing field”. These exhortations won’t help. It should direct the government to enact a law on curbing freebies.
(The writer is a policy analyst; views expressed are personal)
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