The word Freebie is used to describe any physical item given to gain votes or popularity amongst low-income earners at the expense of the government’s finances. The culture of providing freebies is not new to the Indian political landscape. Our neighbouring country, Sri Lanka, is witnessing a massive economic crisis. Their leaders engaged themselves in mass appeasement to come into power by cutting down taxes which heavily impacted the government’s revenue. Are we heading in the same direction?
The late AIADMK leader, Ms J. Jayalalithaa was the pioneer of the subsidy or freebie incentives in the country. During her reign, her party manifesto offered free grinders, mixers, electricity, laptops with internet connection for students etc. The scope and the budget for these freebies increased in every election. Recently campaigning for elections in Uttar Pradesh, Amit Shah promised gas cylinders while rival Akhilesh Yadav of the Samajwadi Party promised a kilo of ghee and free ration. In Punjab, the Aam Aadmi Party made hefty promises by ensuring women above the age of 18 years were given Rs 1000 each. They also promised free electricity for all. Later, when elected in power, the AAP Chief minister sorted 1 Lakh Crore financial package from the centre to boost Punjab’s economic well-being. If the party was aware of the financial situation of the state, then why did they make such big promises? After Congress’s internal politics nearly broke the party, Aam Aadmi Party was considered a second option and comfortably gained power in the state. It has also been observed that the party heavily relies on subsidies to bribe the voters. Earlier this year, after a Public Interest Litigation (PIL), was issued by advocate Ashwani Upadhyaya citing Freebies as a serious threat, the Supreme Court issued notices to the centre and the Election Commission seeking deregistration of political parties and symbols who are offering irrational incentives. In March, another PIL was heard wherein it was requested that candidates should declare in the nomination forms that they have not made promises of freebies at the cost of public money. The Election Commission in response said to the Supreme Court that it should be left for the voters to decide whether freebies are good for the state or not. By issuing freebies, the government is essentially bribing the voters with short-term benefits and hampering the state’s revenue in the long run. The political parties are not concerned with bringing reforms into policies but are motivated by their greed to stay in power. Not only that but several of these schemes are also discriminatory as they further classify the society based on gender or religion and not economic well-being. Moreover, it can negatively impact work ethics. As seen in the US, numerous workers left their jobs as they thought their future would be stable because of the benefits given to them by the state. Ideally, freebies should be given during emergencies. For instance, providing food and free ration to the migrant workers during the pandemic. When someone is promising freebies, they should declare the source of the money which will be required to distribute them. Additionally, if the government is spending its resources on consumption, then there must be clear demarcations on how the money will also be allotted for infrastructure or investment projects. Lastly, with the irrational budgets set against these provisions, the states might face a revenue deficit amounting to a bigger economic crisis as seen in Sri Lanka.
References:
1. Dr Parashant Deshpande, Times Of India, Impact of Freebies on the Economy of the state, April 5th 2022, https://timesofindia.indiatimes.com/blogs/truth-lies-and-politics/impact-of-freebies-on-the-economy-of-a-state/
2. Uttam Gupta, Financial Express, Freebies: Why is it a road to fiscal disaster, February 24th 2020, https://www.financialexpress.com/opinion/freebies-why-it-is-a-road-to-fiscal-disaster/1876798/
3. Gautam Dheer, Deccan Herald, Kejriwal rolls out populist freebie driven agenda in poll-bound Punjab, January 12th 2022, https://www.deccanherald.com/election/punjab/kejriwal-rolls-out-populist-freebie-driven-agenda-in-poll-bound-punjab-1070474.html