Why is it in the news?

• Recently, the Supreme Court of India, requested responses from the governments of Madhya Pradesh and Rajasthan regarding a PIL (Public Interest Litigation) alleging misuse of public funds for offering irrational freebies ahead of elections.

More about the news

• The PIL contends that taxpayers’ money is being used by the governments of Madhya Pradesh and Rajasthan to entice voters through the distribution of irrational freebies, which is likened to bribery and undue influence offenses under the Indian Penal Code.
• The petitioner called for the court to establish comprehensive guidelines on pre-election announcements made by Chief Ministers.
• The financial condition of the Madhya Pradesh government was described as “bad” in the petition, citing a significant increase in debt from ₹49,646 crore in 2006 to ₹3.78 lakh crore in March 2023, as reported by the Reserve Bank of India.

About Freebies

• Freebies are goods and services provided at no cost to users.
• Their primary goal is to offer immediate benefits to the targeted population.
• Freebies are sometimes employed as a strategy to attract voters or gain support through populist pledges.
• Examples of freebies include free laptops, televisions, bicycles, electricity, water, and more.

Advantages of Freebies

Public Outreach and Engagement

• Increase public trust and satisfaction with the government.
• Facilitate feedback and dialogue between the government and citizens.
• Enhance transparency and democracy.
• Positively impact voter turnout and political awareness.

Economic Growth

• Stimulate economic growth by enhancing the workforce’s productive capacity.
• Improve skills, mobility, and income opportunities, especially in less developed regions.
• Increase educational enrolment and retention rates, reduce dropout rates, and improve learning outcomes.

Social Welfare

• Provide basic necessities and social welfare to marginalized sections of society.
• Improve literacy, health, and overall quality of life.
• Reduce poverty ratios and out-of-pocket healthcare expenses.

Income Equality

• Reduce income inequality and poverty by redistributing wealth and resources.
• Empower low-income households with assets, credit, or income support.

Disadvantages of Freebies

Dependency Syndrome

• Create a pattern of dependency and entitlement among recipients.
• Reduce motivation to work or pay taxes.
• Risk of making beneficiaries dependent on external aid.

Fiscal Burden

• Strain government finances, increase deficits, debts, and inflation.
• Impact budgetary resources and fiscal discipline.
• Affect investment in essential sectors.

Resource Misallocation

• Distort expenditure priorities and allocation of resources.
• Divert funds from productive sectors to freebies.
• Crowd out investment in public goods.

Quality Compromise

• Lower the quality and competitiveness of goods and services.
• Reduce incentives for innovation and improvement.
• Result in inferior or outdated technology.

Impact on Environment

• Encourage overuse and wastage of natural resources.
• Discourage conservation and efficiency efforts.
• Increase carbon footprint and pollution levels.

Way Forward

• Require disclosure of financing, revenue sources, and impact on fiscal balance.
• Specify the opportunity cost of public spending and the sustainability of freebies.
• Grant more powers to the Election Commission of India (ECI) to regulate and monitor freebies during elections.
• Enable ECI to de-register parties, impose penalties, or take contempt action for violations.
• Educate voters about the consequences of freebies.
• Encourage voters to demand performance and accountability from political parties.
• Propose measures through judicial involvement.
• Create a conducive environment for economic growth and social progress.
• Promote long-term, inclusive development as an alternative to freebies.