Months After Calling It A 'Retrograde Step', Election Commission Says Electoral Bonds Are A Step In The 'Right Direction'

Updated on: 19 January 2018 11:25 am

Electoral bonds will not solve all problems pertaining to transparency in political funding, Chief Election Commissioner A K Joti said on Thursday, but hoped that it will be a step in the "right direction".

Electoral bonds, which were introduced by the government to make funding to political parties transparent, will allow a political donor to purchase bonds from authorised banks and can be redeemed by parties only through registered accounts in a prescribed time frame.

"There will be a banking trail of the donations which will be made. That is one step in the right direction. I have not said it will solve all the problems...Let it (bonds) be rolled out..," he said, when asked if the usage of these bonds will address issues pertaining to transparency in funding of political parties.

Responding to questions at a press conference on the possible use of electoral bonds by people to fund parties during the upcoming Assembly polls in Meghalaya, Tripura and Nagaland, the CEC said the bonds will "definitely" be used as the finance ministry has already notified their availability.

The press conference was called to announce the Assembly election schedule for northeastern states.

He also said that he was "hopeful that it will be a step in the right direction."

Joti's remarks come nearly eights months after the EC had told a parliamentary committee that electoral bonds introduced by the government is a "retrograde" step.

Asked "what has changed", as the commission had earlier expressed reservations on the issuance of electoral bonds, Joti maintained, "nothing has changed".

The commission, in a written submission to the parliamentary standing committee on law and personnel in May, had said changes made in the election laws after the introduction of the bonds would compromise transparency in political fundings.

"The amendment in section 29 C of the Representation of the People Act, 1951 making it no longer necessary to report details of donations received through electoral bonds is a retrograde step as transparency of political funding would be compromised as a result of the change," it had said.

Earlier, an Outlook article had explained how electoral bonds are a one-way mirror that shows government who funded the Opposition but keeps public in dark.

The electoral bonds are just an alternative to cash donations made to political parties. That's about it. The most important thing is that these bonds will NOT carry the donor's name even though the purchaser would have to fulfill KYC norms at the bank.

It is strange that the government can know the name of the donor, but you or I cannot. The government may emphasize that the electoral bonds will not carry the donor's name, but in reality, the government-controlled banker (SBI) will know. If KYC is verified and done properly, this means PAN and Aadhaar will be used for documentation and so the Income Tax department can know.

By extension, this means the government of the day, by pulling a few strings here and there, can easily find out who the donor is behind an electoral bond. If the government can know who donated what money and to whom, it is very difficult to understand why the public at large cannot know who funded which political party.