By her own admission, finance minister Nirmala Sitharaman “does not have the kind of money” required to contest a Lok Sabha (LS) election. Asked if money power was such an influence that even the FM could not contest an election, she said at a media summit, “My budget, my salary, my earning, my saving is mine, and not the Consolidated Fund of India. And obviously, I can’t.”
She clearly can’t, because according to the affidavit filed by Sitharaman as a Rajya Sabha MP in 2023, she had total assets of Rs 2.56 crore, which appears to be too little for being a successful LS poll candidate. While one must appreciate the FM’s forthrightness, it does raise an interesting question: Is the LS becoming a club for the richie rich only? To quote the great political philosopher Cyndi Lauper, “Money changes everything.” And nowhere is that proverb more taken to heart than in an election, where crores of rupees are raised and spent on the understanding that money is a crucial determinant of whether a candidate will win.
In 2009, an average candidate who went on to win the Lok Sabha elections had spent around Rs 30 lakh. The next general election’s cost went up to Rs 40 lakh. In 2019, the average winner’s spending on elections went up further to Rs 50 lakh. According to the Election Commission of India, for a Lok Sabha seat, a candidate can spend no more than Rs 95 lakh for bigger constituencies with more voters, and up to Rs 75 lakh for smaller constituencies.
But that’s only on paper; in reality, this expenditure cap is rarely adhered to. Apart from expenses for campaigning, candidates are known to spend enormous amounts of money on freebies to entice voters. It’s obvious that the official expenses declared to the Election Commission by winning MPs are a mere sliver of the actual campaign costs, which include all contestants, not just those elected. The disclosed figures are the tip of the financial iceberg, hinting at a deeper, undisclosed cash flow in political funding. This is evident from the fact that enforcement agencies have already made a record seizure of more than Rs 4,650 crore — touching an all-time high in the history of Lok Sabha polls in India — in the Election Commission’s resolute fight against money power, even before the first phase of polling for the 18th Lok Sabha elections commenced on Friday.
The Centre for Media Studies (CMS) has predicted that political parties and candidates would spend more than Rs 1.2 trillion in the 2024 elections, making it India’s most expensive electoral contest. The problem is that while candidate expenditure is capped, party expenditure remains unconstrained. That remains a big loophole. For example, the Election Commission operates with a procedural distinction between candidate and general party canvassing. Even though a candidate may feature prominently on the dais at a public rally, as long as his or her name, constituency and photograph are not mentioned or displayed, the entire cost of the event is attributed to the political party. In reality, much of it is spent by the candidate under the radar.
The lack of a cap on political party spending also fosters a murky financial environment where well-funded parties can easily sidestep candidate-level restrictions, blurring the lines of electoral integrity.
CMS studies have shown that between Rs 55,000 and Rs 60,000 crore were spent on the 2019 Lok Sabha and assembly elections in India. If this figure was averaged out, it would mean that approximately Rs 100 crore was spent on each constituency — and Rs 700 on each vote.
This suggests that elections are swinging more and more in favour of richer candidates who have the financial clout to contest and win. Results of past elections suggest that. Nearly a third of candidates with total assets of Rs 5 crore and above won in 2019; the success rate of candidates with total assets of less than Rs 10 lakh was, by contrast, a mere 0.3%, according to a report by the Association for Democratic Reforms (ADR). The percentage of crorepati MPs rose steadily from 58% in the 15th Lok Sabha (2009) to 82% in the 16th (2014), and 88% in the 17th Lok Sabha (2019), the report said. The report analysed the assets of 539 (of the total 542) winners in 2019, of whom 475 had total assets of Rs 1 crore or more. These numbers were 443/542 in 2014, and 315/543 in 2009.
This is, of course, nothing unique to India. In the US, too, full coffers are quite effective in election efforts. In the last presidential elections, top spenders won their elections 88.5% of the time in the House and 82.9% of the time in the Senate.
It’s true that being rich doesn’t guarantee you a victory in elections. Some of the richest candidates have lost their deposits in the past elections. For example, in 2019, six out of the top 10 wealthiest candidates were from the Congress and lost their deposits despite their substantial assets. The richest among them was independent candidate Ramesh Kumar Sharma from Patliputra, Bihar who declared assets worth over Rs 1,107 crore but lost miserably.
But it’s equally true that while having a lot of funding may not guarantee success, having little is a great predictor of a loss. The cost of elections for virtually every office does create a barrier to entry for many honest politicians.
An obvious consequence of the rising cost of elections has been a rise in more financially privileged people coming into Parliament. The 17th LS, elected in 2019, had 474 MPs with assets worth Rs 1 crore or above, nearly 88% of the House. Over to the 18th Lok Sabha.