THE ELECTORAL BOND SCHEME

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• The Supreme Court will take up for hearing a pending plea challenging the Electoral Bond Scheme, 2018.
• Two NGOs — Common Cause and Association for Democratic Reforms (ADR) — have challenged the scheme, alleging that it is “distorting democracy”.
• These bonds are issued in multiples of Rs. 1,000, Rs. 10,000, Rs. 1 lakh, Rs. 10 lakh and Rs. 1 crore without any maximum limit.
• State Bank of India is authorised to issue and encash these bonds, which are valid for fifteen days from the date of issuance.
• These bonds are only redeemable in the designated account of a registered political party.
• The bonds are available for purchase by any citizen of India for a period of ten days each in the months of January, April, July and October as may be specified by the Central Government.
• A person being an individual can buy bonds, either singly or jointly with other individuals.
• The donor’s name is not mentioned on the bond.
• Donors who contribute less than Rs. 20,000 to political parties through purchase of electoral bonds need not provide their identity details such as PAN, etc.
• The central idea behind the electoral bonds scheme was to bring about transparency in electoral funding in India.
• The government had described the scheme as an “electoral reform” in a country moving towards a “cashless-digital economy”.

Criticism

• The central criticism of the electoral bonds scheme is that it does the exact opposite of what it was meant to do: bring transparency to election funding.
• For example, critics argue that the anonymity of electoral bonds is only for the broader public and opposition parties.
• The fact that such bonds are sold via a government-owned bank (SBI) leaves the door open for the government to know exactly who is funding its opponents.
• This, in turn, allows the possibility for the government of the day to either extort money, especially from the big companies, or victimise them for not funding the ruling party — either way providing an unfair advantage to the party in power.
• Through an amendment to the Finance Act 2017, the Union government has exempted political parties from disclosing donations received through electoral bonds.
• This means the voters will not know which individual, company, or organization has funded which party, and to what extent.
• However, in a representative democracy, citizens cast their votes for the people who will represent them in Parliament.

SOURCE: THE HINDU,THE ECONOMIC TIMES,MINT