Context: Supreme Court sought a response from the States of Madhya Pradesh and Rajasthan on a plea that public funds are being misused to offer irrational Freebies ahead of elections. 

Freebies 

The dictionary meaning of the word freebie is something that you’re given free. But in practice, there is no precise definition of freebies.

The services or provisions provided by the state or union government, such as free electricity, free water, free public transportation, waiver of pending utility bills, and farm loan waivers, etc., straining their resources in the hope of electoral benefits, can be regarded as freebies. 

It is important to distinguish them from public-merit goods, expenditure on which brings economic benefits, such as the public distribution system, employment guarantee schemes, states’ support for education and health. 

Issues Associated with Freebies  

• Election Commission observed that the distribution of freebies undoubtedly by influencing the decision of electorate shakes the root of free and fair elections. 
• Governments resort to the freebie culture to cover up their failure in providing adequate jobs or skilling or ensuring decent livelihood to citizen. 
• Critics argue that freebies disrupt state finances and throw governments into a debt spiral. 
• It undermines credit culture and promotes rent seeking behavior among citizens.  
• It distorts prices through cross-subsidisation eroding incentives for private investment. 
• It disincentivise work at the current market wage rate leading to a drop in labour force participation. 
• The widespread practice of offering freebies by politicians, across party lines and for electoral benefits, drains public finances that can be used instead for more concrete policy initiatives. 
• For example, Punjab’s electricity subsidy and its rising cost to the state exchequer is over 16 per cent of total revenues. 

Steps Taken

Guideline Issued by Election Commission Regarding Manifesto and Freebies 

The Commission, in the interest of free and fair elections directed that Political Parties and Candidates while releasing election manifestos for any election to the Parliament or State Legislatures, shall adhere to the following guidelines:  

Supreme Court Cases

• Indira Nehru Gandhi v. Raj Narain (1975)
  • In this case the Supreme Court held “free and fair elections” to be a basic structure of the Constitution.  
• S. Subraminam Balaji v. State of Tamil Nadu & Others (2013)
  • In this case, the Supreme Court ordered the Election Commission to develop election manifesto guidelines after discussing with all recognised political parties.  
  • In light of this, the Election Commission created the rules and included them in the Model Code of Conduct.  
  • The court determined that while the promises made in the election manifestos cannot be considered “corrupt practices” under Section 123 of the Representation of People’s Act, 1951, it is unavoidable that the giving away of freebies of any kind impacts voters. 
• Ashwini K Upadhyay v. Government of National Territory of Delhi (2021)
  • In this case, the Apex Court observed that a poll manifesto does not have statutory backing and, hence, its enforceability is not within the purview of the courts. 
  • So, the court cannot give directions to any Government to pass or provide anything that is promised by political parties in their party manifesto. 

Way Forward:

• The Election Commission has said the issue of freebies should be left to voters as it cannot regulate state policies and decisions which may be taken by the winning party when they form the government. Such an action, without enabling provisions in the law, would be an overreach of powers, the commission has said. 
• For a country with high poverty rates and persistent economic disparities, welfare schemes are a lifeline for huge populations that demand that a clear definition of freebies differentiating them from the welfare programmes should be arrived at. 
• The democratic forum such as inter-governmental institutions can frame the freebies debate and build a political consensus. 
• The parliament, as a representative body, can debate on the freebies and legislate policies to regulate them.  
• It is essential that political consensus are built, involving the Centre as well as states, to arrest the misuse of welfare schemes and the resultant adverse impacts on the country’s fiscal health. 

The promises of welfare made by political parties to their electorates are part of the key process of bargaining in a democracy where the voter’s judgement is paramount. The interference perceived or real, of non-elected institutions can distort the dynamics of electoral democracy.

It also belittles the electorate’s agency and sense of judgement undermining the basic principle of democracy. So, while regulation of freebies is a necessary evil, political education should be promoted among citizens at the same time.