Dr. Parveen Kumar
No one could have ever imagined that a practice started by late Chief Minister of Tamil Nadu Ms. J. Jayalalitha of providing free washing machines, televisions, sarees and many other things to people will one day play a key role in forming elected governments in the country. The democracy of the country is now a days being lured by the freebies culture and these have started playing a prominent role in India’s electoral politics. Political parties have been competing with each other in the run-up to elections by announcing a string of freebies to woo the electorates. At least in a couple of states in the country the culture of providing freebies has handed over the corridors of power to a political group. In the capital of the country, Aam Aadmi Party (AAP) took the lead, sweeping the Delhi Assembly Elections in 2015, by promising free electricity, water, bus travel to the voters of Delhi. The same thing was repeated in this year in Punjab too by AAP. The impact of freebies was also visible in the 2021 Kerala Assembly elections. In the 2019 parliamentary elections, the ruling Left Democratic Alliance was being routed, but after two years the state government again got elected for a second straight term with a thumping majority, promising subsidized rice and food kits. Despite knowing the fact that freebies put additional burden on the exchequer, the trend is gaining momentum as many other states gear up for assembly elections in the years to come. Even the Honorable Supreme Court in response to a petition filed over the culture of promising freebies ahead of the upcoming Assembly elections in five states has observed that the promise of freebies was a serious issue. Budget for freebies is going above the regular budget and as said by Honorable SC, this disturbs the level playing field.
In a bid to compete for populism, political parties do not look beyond anything except to retain their ruling dynasties even if that costs the country heavily and even if it means the pressing issues are put at the backseat. In the In the run up to the recently concluded assembly elections in Punjab, the AAP had promised to provide free electricity up to 300 units to the people of Punjab, and Rs 1,000 per month for every woman, aged 18 years and above in the state. The state of Punjab is already under a debt of 2.82 lakh crores and going by the poll promises of dolling out freebies, it is expected that the subsidy bill of the state will further increase by Rs 5,000 crore. Similarly the financial assistance of Rs 1,000 per month for every woman aged 18 years and above in the state, is expected to put an additional financial burden of Rs 15,600 crore on the State Exchequer. S. Bhagwant Singh Mann when took over the reins of the state, in his first ever meeting with Prime Minister, Narendra Modi sought Rs. 50,000 Crore financial package for Punjab to improve the financial condition of the state. This can spell doom for the economy of a state. It is not how cheap the freebies are but what matters is how expensive they are for the economy, for life quality and for social cohesion in the long run.
It is no denying the fact that anything given free of cost is being misused. The doling out of freebies amounts to reckless spending of the tax payer’s money. It is thus a blatant financial irregularity that amounts to bribing voters using public money with the only aim of coming to power. It is equivalent to the crime one commits while distributing cash/liquor to garner votes. The Central as well as respective State Governments have their own yearly budgets which outline the expenditures, revenue generation and the fiscal deficits to be incurred. The freebies impose additional financial liabilities thereby affecting the budgetary position of the respective governments. In case of states these dent their annual budgets by crores of rupees. Against the liabilities of these freebies, there is no revenue generation, it results is reduction of the essential spending on providing basic amenities to the needy and the deserving ones.
The culture of freebies even goes against the basic concept of a welfare state. Basically welfare measures are meant for the needy, those with meagre income as they cannot pay for even the basic facilities. Now what actually is happening is that the freebies given by contemporary breed of political parties defies this cardinal principle. Let me clear this example, rupees 1000 to every woman in the state of Punjab, free bus ride in Delhi to all women even if she is a millionaire and on the other hand a man even if he could not afford to travel by bus and is the most appropriate person for such freebies will get nothing. Does not this also defy equity? The fall out of such freebies can be very serious. Infact the top bureaucrats while discussing the deleterious effects of announcements of freebies by various State Governments with Prime Minister of the country have raised concerns on this culture of freebies. The bureaucrats have cautioned against various political parties providing free electricity, which they feared, would put strain on the state budgets and may restrict their capacity to commit more finances to critical social sectors like health and education.
According to N. K. Singh, Chairman of Fifteenth Finance Commission, India is a Union, not a confederation of states. It is not a question of holding together but of coming together. The Union is indestructible. The configuration of the states which constitute the Union can change. The Union, therefore, is integral to both the Centre and the States. The strength of the Centre lies in the strength of the states. Therefore, the macroeconomic stability of the Union is contingent on the macroeconomic stability of both the Centre and States. Freebies are a race to the bottom. Indeed, it is not the road to efficiency or prosperity, but a quick passport to fiscal disaster. Freebies undercut the basic framework of macroeconomic stability.
The politics of freebies distorts expenditure priorities as outlays are being concentrated on subsidies of one kind or the other. It thus impacts seriously the fiscal sustainability for states which are already debt-stressed. Mr. Pant, chief economist at India Ratings and Research Pvt Ltd also opined that freebies are tools in the hands of the Government. If Governments dole out too many freebies, they will directly reflect in the fiscal deficit of the states. This can impact the economy negatively. State Governments need to be wary of these freebies and subsidies.
Given the prevailing circumstances and the lessons learnt and experiences gained from across the globe, it is not wrong to say that freebies the culture of freebies is a threat to democracy and not viable in the long run. Either the Government must come up with some legislation to stop this or the Election Commission has to come forward to take strong steps to curb this menace before the country goes for any State or Central elections.
(The author is a Scientist at SKUAST-K)
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