Announcement of freebies by political parties will lead to economic disaster: Centre to SC

The Centre on Wednesday told the Supreme Court that freebies promised by political parties before polls is an "economic disaster". The apex court suggested an expert body comprising representatives of Niti Ayog, Finance Commission, RBI, political parties and other stakeholders, should examine the pros and cons of freebies, while acknowledging that it is a serious issue.

Solicitor General Tushar Mehta, representing the Central government, said the populist announcements distort the informed decision making of the voter and a voter would know what's going to fall on him. Mehta said, "This is the way, we are heading towards economic disaster". Mehta suggested that the Election Commission of India (ECI) should apply its mind on the matter, and they can have a relook. The ECI's counsel said that its hands were tied by a judgment of the apex court on freebies.

A counsel, involved in the matter, suggested if there's a model manifesto where they say that there's no harm, and if the political parties declare the debt of the state.

A bench headed by Chief Justice N.V. Ramana said these are all empty formalities. Mehta reiterated, "We are heading towards economic disaster".

The Chief Justice said this is a serious issue and the ECI and the Central government cannot say that they cannot do anything in the matter. He said the government and the ECI have to consider the issue and give suggestions. The Chief Justice sought suggestions from senior advocate Kapil Sibal, who was present in the courtroom for another matter.

Sibal suggested that ECI should be kept out of the matter, as it is a political and economic issue, and there should be debate in Parliament on it.

The bench, also comprising justices Krishna Murari and Hima Kohli, said no political party would like to take out freebies, and all want freebies.

The bench noted that these are all policy matters and everyone should participate in the debate. "We'll say Finance Commission, political parties, Opposition parties, all of them can be members of this group. Let them have a debate and let them interact. let them give their suggestions and submit their report", noted the bench. A counsel suggested that RBI should also be included in the process.

The top court asked the Centre, ECI, petitioner and Sibal to give suggestions within a week on the composition of an expert body that will examine how to regulate freebies and give report to Centre, ECI and to the court. The bench scheduled the matter for further hearing next week.

The top court was hearing a PIL by advocate Ashwini Upadhyay against the announcements made by political parties for inducing voters, through freebies, during elections.

Upadhyay argued that ECI should debar state and national parties from making such promises.