OF the three states in India which went to the polls on April 13, it was Tamil Nadu, the erstwhile province of Madras, which saw an unbridled play of money power during the election campaign.

That despite the EC's best exertions money was so brazenly spent to bribe voters should serve as a wake-up call. For, it is very unlikely that those Rs54 crores represented the entire amount which the offending party spent.

In 1967, the Congress was ousted from power in this state which has since been run by two Dravidian parties, the Dravida Munnetra Kazhagam (DMK) headed by 86-year-old Chief Minister M. Karunanidhi and its offshoot the All India Anna Dravida Munnetra Kazhagam (AIADMK), headed by the former actress J. Jayalalithaa. Since 1967, one or the other of the two has held power.

In truth, the wake-up call was given exactly half a century ago, early in 1961 when one of Jawaharlal Nehru's close associates, the affluent industrialist Biju Patnaik systematically used money power in the Orissa assembly elections. Those were the days of energetic fund collectors who were party bosses in their respective states. A decade later, Indira Gandhi established her ascendancy and recruited chief ministers as fund collectors.

In 1956, Tata Iron and Steel Company (Tisco) applied to the Bombay High Court for confirmation of amendments to its memorandum of association enabling it to contribute funds to political parties. The court allowed the amendments, subject to full public disclosure.

In doing so, Chief Justice M.C. Chagla remarked: “Democracy would be vitiated if results [of elections] were to be arrived at not on their merits but because money played a part in the bringing about of those decisions. The form and trappings of democracy may continue, but the spirit underlying democratic institutions will disappear.”

He referred to the dangers posed by “big business and moneybags” and appealed to parliament to review the law. This was on the eve of the general election in 1957.

A decade later, business houses were spared. J.R.D. Tata told president R. Venkatraman in August 1987 that “since 1980, industrialists had not been approached for political contributions and that the general feeling among them was that the party was financed by commissions on deals”, mostly defence deals.

Some industrialists do not wait to be approached. They volunteer aid. A close nexus has developed between some of them and some politicians; the identity of the partners is no secret, either. Party expenditure has mounted and the sources of finance have diversified. Not a few politicians solicit donations. These donations are not only for elections or for the party but for their own upkeep.

In a little over the last decade, one has seen politicians of modest means acquire affluence inexplicable by any success in a profession or business. No magistrate dares bring them to book on a charge of vagrancy as men without any ostensible means of livelihood.

Election law has not been reformed to deal with these changes. It has been amended for the worse. The Supreme Court ruled on Oct 3, 1974 that money spent by a political party specifically for its candidate in a constituency should be included in his election expenses. An ordinance was promulgated to override it.

The Supreme Court ruled in 1996 on the exemption to political parties under the Income Tax Act. “A political party which is not maintaining audited and authentic accounts and is not filing the return of income before the income tax authorities cannot justifiably plead that it has incurred or authorised any expenditure in connection with the election of a party candidate.

The expenditure incurred or authorised in connection with the election of a candidate by a political party can only be the expenditure which has a transparent source.”

This ruling and the EC's strict enforcement of the Model Code of Conduct, by limiting disbursements during election campaigns, have helped to some extent. By itself state funding of poll expenses will not be a cure. The pioneering model commonly cited is Germany's Law on Political Parties 1967. But state funding was only one part of the law.

The other two receive little attention in. Chapter II on internal organisation is the heart of the law, and obliges political parties to maintain written statutes and programmes. The rights of members are defined. Free elections to party organs are mandatory. The executive committee must be elected at least every second calendar year. Elections to party organs are decided by majority vote. The party executive and representatives to assemblies of delegates must be elected by secret ballot.

Likewise, party candidates for election to parliament must be elected by secret ballot by the party. Besides, Section 21 of the Federal Electoral Law lays down that a party's candidate must be elected in an assembly of party members in his constituency. In short, it is not open to any cabal or party bosses to hand out party tickets to persons whom they select as candidates for election. State funding does not line the pockets of the party bosses. Chapter VI contains a statutory obligation to publish audited accounts. It is these neglected parts of the law which make state funding worthwhile.

But which law can bar political parties from lavishly offering freebies, at state expense, as the DMK and the AIDMK have done? The bill for their promises could reach Rs2.5 lakh crore in a state facing a debt of Rs1 lakh crore.

M. Karunanidhi promised free mixers and grinders to women voters, J. Jayalalithaa offered a free fan, wet grinder and mixer; if Karunanidhi offered laptops for all students, Jayalalithaa promised free laptops to Class 11 and 12 students irrespective of economic considerations.

Promises of freebies are an insult to the voter. Money power must be curbed but no solution will work unless public opinion is aroused to the menace it poses to democracy.

The writer is an author and a lawyer.