Funding elections in India: Whose money has the most influence?

ByJennifer Bussell
Jul 24, 2018 09:48 AM IST

In India, it’s difficult to find accurate estimates of campaign spending. Research also shows that illicit funds are important in funding elections in the country.

Despite constant chatter about the massive (and rising) costs of election campaigns in India, there is a dearth of credible data on the actual costs, the sources of support for candidates, and the implications of campaign costs on governance between elections.

The strategy of gift-giving, in elections in India, helps explain the role of individual actors in supporting campaigns; even in local offices, politicians report that it is individual party and unaffiliated actors who help to distribute funds.(HT File Photo)
The strategy of gift-giving, in elections in India, helps explain the role of individual actors in supporting campaigns; even in local offices, politicians report that it is individual party and unaffiliated actors who help to distribute funds.(HT File Photo)

However, newly available survey data on politicians in three of India’s largest and most electorally competitive states—Bihar, Jharkhand, and Uttar Pradesh —offer a unique and systematic view into the nature of campaign finance across all levels of elected office, from the gram panchayat to the Lok Sabha, and the possible repercussions for Indian democracy. These data, collected between 2011 and 2014 from surveys of more than 2,500 incumbent politicians, provide insights into the role of political parties in funding elections, candidates’ sources of campaign support, and the specific, and troubling, importance of illicit funds.

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The survey asked politicians about their own spending in past elections, sources of both financial and non-financial assistance, perception of the spending habits of their peers, and, perhaps most importantly, the role of cash in their campaigns.

What did we find? It’s worth starting with what we did not find: accurate estimates of campaign spending. Most respondents report spending less on campaigns than the official limits, despite regular grumbling by politicians about the exceedingly strict campaign finance limits imposed by the Election Commission.

Read | Power to the rich: India needs to talk about money in politics

Thus, either the anecdotal reports are wrong or politicians are unwilling to report honestly on their spending. One piece of evidence in favour of the second explanation is the fact that politicians at all levels indicate their peers spent at least double what they themselves spent, suggesting that their own reports are severe underestimates.

The politicians’ responses were not all such obvious affectations of innocence, however, and there is much we can learn from what they did report.

A key question posed by election analysts, to date unanswered, is the degree to which political parties provide financial support to candidates for office at various tiers of government . We found that party support was far more prevalent at higher levels of office.

More than 60% of politicians at the state and national levels report receiving political party support, compared to fewer than 10% of respondents at the district level and lower.

These are also substantial contributions—with the average amount received at state and national levels making up at least half of reported spending. Thus, political parties play a prominent role in funding high-level elections, while individuals running for office in local councils must instead rely on their own funds for the lion’s share of their campaign. Lower level politicians are further inhibited by a lack of access to financing from private sector and bureaucratic actors, which is more prevalent at higher levels.

Who else might influence elected officials? Answering this question requires attention to broader non-financial forms of election support. Politicians disclosed information about who helped them during the campaign, and here too we see substantial variation across levels of elected office.

State and national-level politicians reported support from a much wider range of actors, but they were particularly reliant on other elected officials, party workers, and individual fixers. Panchayat politicians, in contrast, were relatively more reliant on help from local organisations, such as village or neighborhood associations.

Given the differences in their relative importance during the campaign period, it seems plausible that local associations are more likely to have influence over politicians at the sub-state level while political parties are more likely to have sway over politicians at higher levels.

What do these actors do to support a campaign? Assistance in gift giving is a key role. While giving gifts to voters is technically illegal, more than half of respondents across all levels of office—and nearly all at the state and national level—report that candidates are pressured to distribute gifts on the campaign trail. Gift-giving is such a prominent feature of elections that politicians estimate at least a quarter of voters—across the various types of election campaigns— receive a gift.

This strategy of gift-giving helps explain the role of individual actors in supporting campaigns; even in local offices, politicians report that it is individual party and unaffiliated actors who help to distribute funds.

Perhaps even more surprising is that more than a quarter of state legislators themselves report that they distribute gifts to help other candidates with their campaigns.

In this way, it is not simply canvassing or attending rallies that arenecessary to support candidates, it is taking part in fundamental, but illicit, acts of gift distribution.

The importance of gift-giving in campaigns helps to explain a final and critical finding from the survey—taking us back to the supply of campaign finance—and that is the significance of illicit funds across elections. When asked what they think was the most important source of funds for their peers in the most recent election, the most common response by state and national legislators was funds gained through corrupt means (black money). Although this was a less common response from panchayat politicians, 15-20% of block and district officials still reported that this was the most frequent source of funding.

While the finding that illicit funds are important is not surprising, the degree to which politicians understand black money to be the most important source of funds is striking.

If this is the case, then understanding who has influence over elected officials is not simply a question of who knocked on the most doors or who handed out the most gifts, but rather who has the ability to provide illicit sources of funds.

While this accords with the received wisdom, these data suggest with even greater potency the centrality of black money in India’s democracy.

Jennifer Bussell is assistant professor of political science and public policy at the University of California, Berkeley.

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