LACK OF TRANSPARENCY
Updated: Sep 19, 2020
NEED FOR THE PM CARES-FUND
India’s Covid count is world’s 3rd highest-worst-hit country. Major cities such as Delhi and Mumbai are badly affected, with hospitals struggling to accommodate critically ill patients.
The current surge in infections follows a 2 months India-wide lockdown that began on 25 March and severely disrupted the economy and livelihood. Some researchers say that the government failed to take advantage of this time to prepare the country’s struggling health infrastructure.
AIM OF THE FUND:
Here, Government wakes up with the new type of fund called “PM CARES-FUND’’.
The primary objective of dealing with any kind of emergency or distress situation, like by the COVID-19 pandemic, and to provide relief to the posed affected, a public charitable trust under the name of ‘Prime Minister’s Assistance and Relief in Emergency Situations Fund (PM CARES Fund)’ has been set up.
Does India not have already a fund with similar objectives?
How extraordinary is the PM CARES Fund from the PM's National Relief Fund?
The PMNRF was set up by Prime Minister Jawaharlal Nehru in January 1948 to help dislodged people from Pakistan, as per data provided by the PMNRF. However, this fund has now provided assistance to persons affected by calamities such as floods, earthquakes and cyclones and to the victims of riots and accidents. The fund also covers to various degrees’ medical expenses like heart surgeries, kidney transplants, cancer and acid attacks.
As indicated by a Press Information Bureau report from January 24, 1948, conveying an intrigue by PM Nehru, the PMNRF is a trust comprising of the accompanying board:
• Prime Minister
• Deputy Prime Minister
• President of the Indian National Congress Finance Minister
• A representative of the Tata Trustees
• A member of industry and commerce.
PMNRF was being governed by a managing committee that also consisted of a representative from India’s private business sector, as originally envisaged by Nehru till 1985. Since 1985, when Rajiv Gandhi was the PM, the management of the fund was entrusted entirely with the prime minister. Since then, the PM has had the only discretion of appointing a secretary to manage the fund. Managing the fund is an honorary function and no separate remuneration is paid for it. The PMNRF is directly managed by the Prime Minister's Office and donations made to it are exempt under the Income Tax Act, 1960. In a challenge at the Supreme Court, the Government of India distinguished the PM CARES Fund on the grounds that the NDRF does not accept private donations and is publicly-funded.
In the PM Cares, on the other hand, has the following
• Prime Minister
• Finance Minister
• Minister of Home Affair
• Minister of Defence
The benefit of creating PM-CARE FUND
PM-CARES Fund will be qualified for 100% reasoning under Section 80G of the IT Act.
The 'Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020', which got assent of the President, also amends a provision in the Income Tax Act to allow deduction 100% on donations to the PM-CARES Fund. According to a government statement, the Ordinance "also amended the provisions of the Income-tax Act to provide the same tax treatment to PM-CARES Fund as available to Prime Minister's National Relief Fund. Consequently, the gift made to the PM-CARES Fund will be qualified for 100 percent reasoning under section 80G of the IT Act".
Further, the cut off on reasoning of 10% of gross pay will likewise not be appropriate for gift made to PM CARES Fund
SOLIDARITY AMONG INDIANS
The whole country supported the govt. and donated huge amounts to fight with this pandemic. Press information bureau sites that Rs 9,677.9 crore & Rs 4,308.3 crore have been donated by government agencies and staff. Of this, a minimum of has been deducted, Rs 4,308.3 crore as one-day’s salary of state employees. a minimum of Rs 5,369.6 crore of corporate social responsibility (CSR) funds are donated by private companies, industry bodies and social organizations.
On May 13, 2020, the Prime Minister’s office had announced that Rs 3,100 crore from PM CARES had been allocated for COVID-19 works, the primary and only announcement on expenditure from the fund. Rs 9,677.9 crore that's 32% collected as of May 20, 2020.
Information about funds donated to PM CARES or money spent from the fund isn't widely available publicly and it's unclear if the fund will make its donations public--since it doesn't take money from the Consolidated Fund of India, it doesn't get to be audited by the Comptroller and Auditor General of India
The central government is maintaining a lot of secrecy about the PM Cares fund that's the rationale that it's refused to share information under the Information Act. The PMO replied to Vikrant Togad within 6 days that he has asked many questions related to many subjects within an equivalent RTI application, and he can ask about each subject separately. Hence, information can’t be revealed during this condition. Aside from this, the PMO also argued that the PM Cares Fund isn't a public authority under the RTI Act, 2005, so it's not a compulsion to share information about it. Thus, it's clear from the above description that the govt doesn't want to inform the country what proportion money is received under the PM Cares fund. This is often in sharp contrast to the government's earlier ideology that we are committed to give a corruption-free government within the country.
WHY THESE ARE UNANSWERED?
Why not just rename PMNRF as PM-CARES, given the PM's propensity for appealing abbreviations, instead of making a special Public trust. The Congress leader’s other prominent voices about the opaqueness within the rules and expenditure of the trust also indicated non-utilization of the available funds in PMNRF.
While, the balance in PMNRF is being shown at Rs. 3,800.44 crores, there are reports which highlight the low liquidity of only 15% of this fund, which makes it a challenge to be utilized in case of emergency. Consistent with these reports, bulk of the corpus is invested in fixed deposits, state development loans etc.
Lack of data on the general public domain in reference to – deed of trust of PM CARES, compliance with the principles of charitable trust, constitution & announcement of the fund and therefore the member’s involvement. Meanwhile, there are arguments publicly made that are in favour of making the new fund. Few legal experts are of the opinion that attaching the fund to COVID-19 and allowing micro donations would encourage more people to return, forward and donate.
Highest court of India's dismissal of PIL should clear the confusion about PM CARES Fund
The Supreme Court of India dismissed a petition filed by the Centre for Public Interest Litigation demanding the transfer of funds from PM CARES Fund to the National Disaster Relief Fund. The govt. too, sensing the load of the trust placed thereon, has responded through its hallmark transparency by regularly updating the people of India all that has been made possible by their contributions. The PM CARES Fund allocated Rs 3,100 crore for India’s fight against COVID-19, of which Rs 2,000 crore helped to shop for 50,000 ventilators. Another Rs 1,000 crore has been used for the care of migrant labourers and therefore the balance Rs 100 crore was given to support vaccine development, which has reached the critical stage of trials.
So Modi’s PM CARES turn a replacement chapter in preparing a stronger coffer for India to tackle Cygnus atratus events just like the Coronavirus pandemic or will it go the PMNRF way? Commitments for contributions appear as if they might well exceed PMNRF’s existing corpus. The Tata group has committed Rs 1,500 crore. Other corporates like Vedanta, Adani, Reliance Industries Limited among others have pledged crores in donations to the fund. So it have bankers, sports bodies, sportspersons, Bollywood actors and other wealthy Indians. With a more democratic and constitutionally sound trust in expectations would be that PM CARES becomes a fund that India can readily believe in emergencies when the longer term of a whole country is at stake.
Author : P.Likhitha Reddy
Sources : pmindia.gov.in, businesstoday.in, factly.in, indiaspend.com, livemint.com
Picture : rediff.com