PYQ ANCHORING:

GS 2: In the light of recent controversy regarding the use of Electronic Voting Ma chines (EVM), what are the challenges before the Election Commission of India to ensure the trustworthiness of elections in India? [2018]

MICROTHEMES: Elections

The Supreme Court of India has expressed concerns about the increasing trend of political parties offering free goods and services to voters before elections. It questioned whether such practices are creating a culture of dependency and discouraging people from working.

Freebie Culture

A freebie refers to any item or service given to people at no cost. The Reserve Bank of India (RBI) defines freebies as government welfare measures provided free of charge, such as free electricity, water, public transport, farm loan waivers, and subsidies.

Key Concerns Raised by the Supreme Court

Issue	Explanation	Example
Encouraging Unemployment	Free ration and direct cash transfers may reduce the motivation to seek jobs, shrinking the labor force.	Some reports suggest that in states with extensive welfare schemes, fewer people are looking for work.
Misallocation of Resources	Funds meant for essential services like public infrastructure and government salaries are being diverted to fund freebies.	In some states, delays in government employee salaries have been reported due to excessive welfare spending.
Fiscal Burden	Excessive subsidies can push states into financial distress.	In Punjab, subsidies consume 16% of total revenue, raising concerns about economic sustainability.
Political Manipulation	Offering freebies during elections can unfairly influence voter decisions, affecting free and fair elections.	The court warned against using welfare schemes as an election strategy rather than a genuine development tool.

Welfare Measures	Freebies
Essential for maintaining the dignity of life, such as healthcare, education, and social protection.	Mass distribution of non-merit goods, draining government revenue.
Aim to accelerate human development and contribute to economic growth.	Reduce incentives for work and distort the economic balance.
Example: Public Distribution System (PDS), State support for education and health.	Example: Free distribution of laptops, scooters, household appliances.

Past Supreme Court Observations on Freebies

2013 Subramaniam Balaji Case: The top Court ruled that such matters fell within the domain of legislative policy and were beyond judicial scrutiny.
- It further underscored that such expenditures could neither be deemed unlawful nor characterised as a “corrupt practice,” particularly since they sought to advance the Directive Principles of State Policy.
2021 Expert Panel Proposal: The SC proposed an expert panel including NITI Aayog, RBI, and political representatives to examine the issue, but no concrete action followed.
2022 Election Freebies Review: The SC flagged concerns over political parties announcing unsustainable schemes without clarity on funding sources.

Advocacy for Freebies

Key Benefits	Explanation	Examples
Poverty Alleviation & Social Protection	Free welfare initiatives help the underprivileged escape extreme deprivation.	Free food distribution during COVID-19 benefited 800 million people; schemes for free housing, toilets, and healthcare improve living conditions.
Improving Infrastructure & Living Standards	Free electricity, water, and sanitation enhance quality of life.	Multi-Dimensional Poverty Index reports show improvement; free electricity for Punjab farmers addresses socio-economic inequalities.
Boosting Human Development	Free education, mid-day meals, and healthcare improve literacy, nutrition, and well-being.	Better access to basic services leads to healthier, more productive citizens.
Economic Stimulus & Workforce Participation	Welfare schemes increase financial independence and consumer spending, stimulating economic growth.	Free public transport for women boosts workforce participation; subsidies enhance purchasing power.
Social Equity & Political Stability	Reducing income disparities helps prevent social unrest and strengthens democratic engagement.	Political parties justify freebies as essential for public welfare and governance.
Constitutional Backing (DPSP)	The State can provide welfare benefits within its economic capacity.	SC in the Subramaniam Balaji Case upheld Tamil Nadu’s laptop and TV distribution under Directive Principles of State Policy.
Immediate Relief in Crisis	Freebies are crucial during emergencies like pandemics, natural disasters, and riots.	Free COVID-19 vaccinations helped tackle the pandemic.
Encouraging Sustainable Development & Self-Sufficiency	Targeted subsidies for renewable energy promote long-term sustainability.	Short-term relief allows beneficiaries to invest in education and employment, fostering self-reliance.

Recent Examples of Freebies in India

Delhi’s Free Electricity Scheme: The AAP government’s policy of providing free power up to 200 units has led to financial stress on DISCOMs.
- The Policy is promised to be continued by the newly elected party.
Maharashtra election Freebie Frenzy: A fierce battle of freebies was seen between the parties during the Maharashtra assembly poll
Punjab’s Free Electricity to Farmers: Contributing to groundwater depletion and financial mismanagement.
Karnataka’s ‘Gruha Lakshmi’ Scheme: Providing ₹2,000 per month to women heads of families, increasing fiscal deficit.
Tamil Nadu’s Free Laptop Distribution: While aimed at digital literacy, many beneficiaries sold their laptops for cash, defeating the purpose.
Rajasthan’s Free Mobile Scheme: The government’s ₹1,200 crore initiative for women has raised concerns about sustainability.

Challenges of Excessive Freebies in India

Fiscal Strain – Rising welfare expenditures are pushing states toward financial distress.
- Punjab, Jharkhand, and Rajasthan are struggling to manage their budgets.
- NITI Aayog’s Fiscal Health Index 2025 ranked Punjab last among 18 major states due to its growing reliance on external debt.
Dependency Mindset – Long-term freebie schemes discourage people from actively seeking employment.
- Maharashtra is facing labor shortages as entitlement programs reduce the motivation to work.
Cascading Effect – One state’s freebie policies often influence others, increasing overall financial burden.
- Rajasthan announced 150 units of free electricity in its 2025-26 budget, following Delhi’s lead.
Distorted Economic Priorities – Freebie spending diverts funds from essential infrastructure.
- Karnataka spent thousands of crores on election promises, leaving insufficient funds for critical projects.
Environmental Consequences – Some welfare policies have harmful ecological impacts.
- Free electricity for farmers in Punjab and Haryana has led to excessive groundwater exploitation.

Way Forward

Stronger Laws & Policies – The government should amend election laws (Representation of the People Act – RPA) to regulate promises made by political parties. Parties should also be required to clearly explain how they will fund their schemes.
Better Budget Control – States should set a limit on freebies, capping them at 1% of their total economy (GSDP) or tax revenues. Freebies should not push states into a financial crisis by exceeding the limits set by the Finance Commission.
Empowering the Election Commission (ECI) – The ECI should have the power to regulate election manifestos and stop unrealistic promises.
A Model Manifesto should be introduced to ensure transparency and prevent misleading commitments.
Making Voters Aware – People should ask political parties how they plan to fund freebies. Governments should focus more on long-term development rather than short-term election strategies.
Understanding the Difference Between Subsidies & Freebies – Unlike freebies, subsidies help in development by filling gaps in key sectors.
Example: Subsidies for solar panels help promote clean energy and economic growth, whereas giving away things for free without a long-term goal can create dependency.

#BACK2BASICS: Lessons from Freebies and Socialist Experiments Across the World

Key Issue	Explanation	Examples
Economic Collapse Due to Excessive Freebies	Over-reliance on freebies led to mass dependency and economic downfall.	Venezuela’s free food, transport, and services resulted in a non-productive population, causing economic collapse around 2000.
Stagnation and Lack of Progress	Excessive state-controlled welfare limits economic growth and innovation.	Cuba’s outdated infrastructure and restricted technological access stem from government-controlled welfare and lack of competitive markets.
Authoritarian Control Through Welfare	Welfare can be used to suppress economic freedom and private sector growth.	North Korea provides basic necessities but restricts political and economic freedoms, leading to extreme poverty.
Socialist Models with Capitalist Adaptations	Combining socialism with market-driven policies can sustain economic growth.	China integrates state control with capitalist expansion, driving economic development while avoiding complete dependency.
Judicial Limitations on Excessive Welfare	Courts have ruled against excessive welfare that does not serve a clear public purpose.	U.S. courts in Coates vs. Campbell and Roberts vs. Hopwood (1925) restricted state expenditure on non-essential welfare.