By Amol Agrawal
The Supreme Court (SC) recently passed an order related to the appointment of the Chief Election Commissioner (CEC). Until now, the CEC was appointed by the president, based on the recommendation of council of ministers headed by the prime minister. The apex court has said the panel should include the leader of opposition and the chief justice of India as well.
At a broader level, the SC order has once again led to revisiting the old discussion on autonomy of public institutions in India. The public institutions, whether it is the Election Commission of India or any other, have been created to provide various public goods and services to the citizens. It is important that the institutions have autonomy to serve the desired goals; else, they will be captured by the State, defeating the purpose of creating these institutions.
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In recent years, the literature on central bank independence has helped us understand these issues better. Let’s revisit some of the key ideas from the literature and reflect on the public institutions in India. While the literature stresses on the term ‘central bank independence’, a more appropriate term is autonomy as one can’t really create institutions that are independent from the government.
The central-banking literature has classified autonomy as four types. The first type is institutional, which means the decision-making bodies of the said institution is not subject to accepting any instruction from any other authorities.
The second type is functional and operational autonomy, which means once the objective of the institution is spelt out clearly, then the institution is free to develop instruments to achieve the objective. The research also terms this as goal and instrument independence. In central banking parlance, the government gives the macroeconomic goals such as inflation target and the central bank chooses the instruments such as interest rates to achieve the target.
The third type is financial autonomy, which is closely linked to the functional autonomy. Only if the institution has sufficient financial resources can it achieve functional autonomy. Nearly all the public institutions are dependent on the government for capital and incur expenditures to achieve the goals. If the institution is not adequately capitalised then it will always be under pressure from the government. In an earlier article, I had pointed how the central banks have incurred large losses in 2022, which is threatening both financial and functional autonomy.
The fourth type is personal autonomy. This means the appointment of the key decision-makers of the institution should be done in a transparent manner. There should be safeguards for the appointees from political pressure and clear provisions outlining possible causes for removal from office.
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The SC order deals only with the fourth type of autonomy. But, even that is also very selective as it attempts to broaden and diversify the panel that selects the CEC. For higher personal autonomy, the SC should also look at other aspects such as length and nature of tenure. The tenure should be reasonably long-term and without the possibility of dismissal unless there is a valid case for termination with conditions for this spelled out. The contract should also be non-renewable so that the appointee does not seek reappointment by complying with the demands of political authorities.
The CEC is ideally appointed for six years or upto 65 years of age, whichever is earlier (maximum age was 62 years till 1993). Since 1950, there have been 25 CECs, which means the average term is less than three years. Only three CECs have got a term of six years and above, with TN Seshan being the last such CEC whose term was from 1990-96. Before Seshan, the average tenure was around four to five years; post-Seshan, the average tenure has been around two years. In the last 10 years, we have seen 7 CECs! While none of them were dismissed, they completed the maximum age of 65 years. Even the current CEC, Rajiv Kumar was appointed when he was above 62 years, meaning his tenure will be less than three years.
The SC order has once again brought attention to the need to bring more autonomy to the public institutions such as CEC. However, the SC deals with just one aspect, personal autonomy, where it is trying to achieve a balanced panel for selection of the CEC. But then if tenures remain short, the autonomy will remain limited. In fact, the tenures of the chief justices of India have also been really short. Since 1951, there have been 50 CJIs, with the average tenure standing at 1.5 years. In the last 10 years, we have had 11 CJIs! Apart from personal autonomy, there are also other types of autonomy that need serious reflection.
The discussion (and action) should obviously not be limited to Election Commission of India but extended to other institutions as well. There is constant criticism of India’s public institutions not achieving their objectives, but often being seen encroaching other institutions’ turfs. This is also because the objectives and instruments of the institutions are not well defined. Strengthening autonomy of India’s institutions will help strengthen the quality of Indian politics and economics, and serve the country well.
The writer is assistant professor of economics, Ahmedabad University