With political debate heating up on need of bringing political parties under ambit of Right To Information law, the government has firmed up a new law to make funding to political parties more transparent.
The new ‘election finance’ law aims to give election commission powers to scrutinize the funding of political parties for elections.
“We want to have an effective system to check corruption in the political system,” said a senior government functionary.
The idea to have a model law was first mooted by Prime Minister Manmohan Singh about two years ago but it did not get much steam from the Law ministry, empowered to pilot a key electoral reform initiative of the UPA government.
With the change in guard, the ministry has decided to finalise the draft financial transaction law in consultation with the Election Commission within a month. It also wants to hold an all party meeting so that the bill can be introduced in the Parliament’s budget session.
A senior government functionary said that the bill would be major electoral reform after 2003 when the government changed the Representation of People’s Act to allow corporate and individuals seek income tax exemption on donations made to political parties of Rs 20,000 or more in a year.
This also provided for the parties to file annual returns and details of those who have donated more than Rs 20,000.
But, since then influence of black money in elections has increased and was evident from seizure of over Rs 100 crore each during last Tamil Nadu and Uttar Pradesh assembly elections.
The government believes that the bill could probably reduce use of black money in electoral politics with the parties having to declare their funding sources to a government agency.
As the proposed law could shrink funding sources of smaller political parties, the draft bill also provides for guidelines for partial state funding to the recognised political parties for certain election works such as publishing of publicity material.
Limited state funding is already there with free air time given to major political parties on public broadcaster Doordarshan and All India Radio during elections.
While seeking existing state funding does not make political parties accountable, the new law aims to bring in some accountability. Government officials, however, point out that achieving political consensus on the proposed law would not be easy.
With this, the government also wants to counter the debate on making political parties accountable under Right To Information Act.