With the ongoing tussle between various Central Oversight Regulatory Bodies and the Union Government, a comprehensive analysis of key oversight bodies in India and its associated issues becomes imperative.
• Reserve Bank of India (RBI): RBI and the Government of India were at loggerheads with each other on various issues like Independence in Decision Making, Dividend Payments, Interest Rate Reductions, Bad Loans Resolution, etc.
• Election Commission of India (ECI): In April this year, the ECI had sought a constitutional amendment for greater autonomy and rule-making powers and also the provision to treat the election commissioners on a par with the Chief Election Commissioner(CEC).
• National Human Rights Commission (NHRC): Supreme Court referred to NHRC as a Toothless Tiger as it could not bring justice to Human Rights victims due to its limited powers.
• Central Bureau of Investigation (CBI): CBI was home to a big controversy recently when the Director and Special Director raised corruption allegations against each other leading to the appointment of a new temporary chief for CBI.
• And more recently, Andhra Pradesh and West Bengal withdrew general consent, which is mandatorily required for CBI to work in these states.
• “Caged Parrot”, the word used by Supreme Court to refer to CBI continues to be relevant today due to the lack of functional autonomy and persistent Government interventions in its functioning.
RESERVE BANK OF INDIA (RBI)
Ongoing tussle of power between RBI and Government on various issues like payment regulator, PDMA etc.
• The Reserve Bank of India, India’s Central Bank was established on April 1, 1935 in accordance with the provisions of the Reserve Bank of India Act, 1934. It was later nationalised in the year 1949.
• The purposes for which the RBI has been established as India’s Central Bank have been spelt out in the Preamble of the RBI Act-1934:
• To regulate the issue of bank notes,
• Keeping of Reserves with a view of securing Monetary Stability in India,
• Operating the Currency and Credit System of the Country,
• Ensuring a modern monetary policy framework with the primary objective of Price Stability while keeping in mind the objective of Growth.
Roles and Responsibilities of RBI:
Along with the above role, other responsibilities of RBI are as follows:
• Public Debt Management
• Non-Banking Financial Companies Supervision and Regulation
• Supervision and Regulation of Cooperative Banks
• Regulation of Derivatives and Money Market Instruments
• Payment and Settlement Functions
• Financial Inclusion and Development Functions
Various Reasons for Tussle between RBI and Union Government:
Recently, RBI Deputy Governor Viral Acharya suggested that undermining the regulator’s independence could be “catastrophic” and held that RBI is not a department of the executive function of the government. In this context, we will discuss the key areas of discordance between RBI and Govt.
• Invoking of Section-7 of RBI Act: Government has decided to invoke Section 7 of the RBI Act under which Government can issue directions to RBI in larger public interest. RBI however suggests that this move may affect its functional autonomy.
• Weak Banks: In an attempt to clean up the banking system, the RBI ring-fenced weak state-run banks through the Prompt Corrective Action (PCA) framework that places curbs on lending, expanding branch network and dividend distribution. The government wants some of these strictures to be eased so that banks can kick start lending and support growth.
• Interest Rates: While RBI is more inclined towards higher interest rates for curtailing high inflation, Government wants lower interest rates to boost economy.
• Banking Frauds: While Government criticized RBI for its failure to check frauds like Nirav Modi Scam, RBI is of the opinion that it is not sufficiently empowered by the Government to check such frauds.
• RBI’s Reserves: The RBI keeps a large reserve of cash, which the Government wants to put into productive use. However, RBI believes that such reserves are needed to deal with international volatility and to maintain high creditworthiness and it is thus averse to the idea of using reserves for other purpose.
• Payments Regulator: The RBI opposes an inter-ministerial panel’s recommendation for the creation of a separate payments regulator.
• The inter ministerial Committee was formed for finalization of amendments to the Payment & Settlement Systems Act, 2007. It proposed the establishment of an Independent Payments Regulatory Board (PRB) to foster competition and consumer protection, systemic stability and resilience in the payments sector, which is being driven by the digital payments in the country.
• The RBI dissented against this recommendation saying that the regulation of payment systems should be with the RBI as Payment systems are a sub-set of currency which is regulated by the RBI.
• Public Debt Management Agency: While the Government is of the opinion that Public Debt Management Function of RBI needs to be given to a separate agency, RBI strongly opposes that.
• Earlier in 2016, the finance ministry had setup a Public Debt Management Cell (PDMC) housed in RBI itself as an advisory body.
• The PDMC is planned to be converted into a full-fledged Independent Public Debt Management Agency by the end of this year which will manage government debt including all market borrowings, a function currently performed by the RBI.
• Dividends and Surplus Payments: The govt is of the view that the RBI should part with most, if not all, of its profit as dividend to the government as the latter is the complete owner of RBI.
• The RBI opposes this idea and says the government is undermining its independence by asking for a greater share of surplus at a time when there is a need to make the RBI’s balance sheet stronger.
Steps taken to Address the Issues:
On 19th November, 2018 RBI Board Meeting was held where all the existing issues were discussed by both RBI and the Union Government. The key outcomes of the meeting are as follows:
• RBI Agreed to provide relief to small and medium firms.
• RBI also agreed to ease lending restrictions on some state owned banks through the review of Prompt Corrective Action Framework.
• Government agreed that the autonomy of the Reserve Bank of India (RBI) is “essential” and an accepted governance requirement.
• Expert Committee will be formed for Economic Capital Framework Law to fix the Reserves, Capital requirements of RBI to shield or protect it from future losses.
• Adopt Consensus-Based Approach: Both the Government and the RBI, in their functioning, have to be guided by public interest and the requirements of the Indian economy. For this purpose, the need is to have extensive consultations and speedy resolution of several issues that emerge between them.
• While the Government needs to respect the independence of the Central Bank for effective functioning, RBI on its behalf needs to address the genuine concerns of the Government from time to time.
• We need to invoke the Cooperative Spirit shown by Government and the RBI in the setting up of the Monetary Policy Committee (MPC) earlier for ensuring Fiscal and Monetary Stability of the Indian Economy.
ELECTION COMMISSION OF INDIA (ECI)
ECI called for more functional autonomy in its petition to the Supreme Court.
Background: The ECI is a permanent, autonomous, quasi-judicial and constitutional body created under Article-324 of the Indian Constitution. At present the ECI is a three-member body, consisting of a Chief Election Commissioner and two Election Commissions.
ECI administers elections to the Lok Sabha, Rajya Sabha, and State Legislative Assemblies in India, and the offices of the President and Vice President in the country according to Article 324(1) of the Constitution.
Roles and Responsibilities of ECI:
While Article-324 broadly confers the powers of Superintendence, Direction and Control of Elections on ECI, some specific tasks it is entrusted with are as follows:
• Preparation of Electoral Rolls
• Enforcing of Conduct of Election Rules-1961 and Election Symbols Order-1968
• Registration of Political Parties
• Recognition of Political Parties and allotment of Symbols
• Enforcing of Model Code of Conduct
• Key role in the Delimitation of Constituencies
• Checking Electoral Malpractices like Paid News, etc.
• Quasi-Judicial: While settling disputes with respect to the recognition of political parties or symbols allotment, ECI acts as a court. This was recently seen in Tamil Nadu during the allotment of 2 Leaves AIADMK symbol to the PalaniswamyPaneerselvam faction.
Scope of Powers of ECI
• The Supreme Court in KL.Omar Judgement, 1985 held that powers enjoyed by the ECI under Article-324 are Plenary in nature and uncontrolled by the executive. They are limited only by the Principles of Natural Justice, Constitutional Provisions and Laws made by the Parliament.
• It has a “Reservoir of Powers” using which it can act on any matter, if any electoral law is silent.
• ECI used these powers to cancel RK Nagar By-poll in April-2017 due to excess circulation of money despite not having explicit powers to do so under the existing laws.
Advising the President on the question of disqualification if any Member of Parliament or advising the Governor on the question of disqualification of a member of a State legislature (Article-103). Advising the President whether elections can be held in a state under President’s rule.
Achievements of ECI:
• Effective and Efficient Election Process: India’s election process is smoother, more efficient, cheaper to conduct and quicker to deliver than any other large democracy, including the United States.
• Ever Increasing Electorate: With wide ranging moves to bring Electoral Awareness like Systematic Voter’s Education and Electoral Participation (SVEEP) to inform, educate and to motivate voters, India’s electorate today has grown to nearly 870 Million.
• Credibility: ECI along with Supreme Court enjoy the highest amount of Credibility both domestically and abroad. As per a revelation by an RTI, nine countries have approached the ECI for the voting machines, including Nepal, Nigeria, Indonesia and Russia.
• Technology Friendly: Election Photo Identity Cards (EPIC), Electronic Voting Machines (EVM) greatly helped in improving the Election Processes in India. And more recently, the Voter Verifiable Paper Audit Trail (VVPAT) equipped EVMs further helped in enhancing fairness of Elections.
• Inclusive: By ensuring all required facilities in polling booths to boost the voting of weaker sections like Divyangs, Old Aged People and Women. It was also one of the first government bodies to allow the identification of oneself as a Transgender.
• Model Code of Conduct: Over the last 30 years, ECI implemented MCC in an impartial manner conferring it sanctity, approval of all the political parties and public.
Challenges Faced by ECI:
• Lack of Sufficient Autonomy:
The Chief Election Commissioner and other Election Commissioners are appointment by the President rather than by an empowered committee.
• The Constitution has not prescribed the qualifications (legal, educational, administrative or judicial) of the members of the ECI.
• Expenditure of the Election Commission is voted upon and not charged upon Consolidated Fund of India.
• The conditions of service of only the Chief Election Commissioner cannot be varied to her/his disadvantage after their appointment.
• Only the Chief Election Commissioner has been provided security of tenure in the sense that s/he can be removed in the same manner and on the same grounds as Judge of the Supreme Court. However, other Election Commissioners have not been provided this security of tenure.
• The Constitution has not debarred the retiring election commissioners from any further appointment by the govt.
• No Independent Secretariat has been provided for the ECI.
• Criminalization of Politics: In 16th Lok Sabha, around 34% of the MPs have serious criminal cases against them.
• Unable to enforce Electoral Spending Limits: While the official limits for large constituencies are 70 Lakhs for Lok Sabha, 28 Lakhs for Assembly in reality the spending is as high as around 10 Crores, 3 Crores respectively according to PRS Legislative Research.
• Limitations on Powers:
• No extensive rule making Powers: The ECI implements the MCC is a set of norms evolved with the consensus of political parties.
• Cannot deregister a Political Party: As the Representation of the People Act, 1951, has no explicit provision for deregistration of a political party, therefore, the ECI can only register a political party and not de-register them.
• However, the ECI can delist political parties for being inactive for a prolonged period; not taking part in the election process; or because of mismatch of address.
• Inability to ensure Transparency in the Maintenance of Accounts of Political Parties: While political parties and candidates must submit accounts for contributions received and expenditures made to the ECI, there is no requirement for these accounts to be audited and placed in the public domain.
• Lack of Adequate Legal Support: Parliamentarians are reluctant to amend Representation of People’s Act-1951 to empower ECI suitably.
• ECI in its 2016 Document titled “Electoral Reforms” suggested the following changes to empower it and make the election process more free and fair:
• Constitutional Amendments to – treat ECs on par with CEC in cases of removal,
• Make its expenses as charged expenditure,
• Provide for a Separate, Independent Secretariat like that of Lok Sabha Secretariat with Rule Making Powers,
• No public office after Retirement for CEC and ECs,
• Introduction of Suitable Sections in the Representation of People’s Act for:
• Making false affidavits, Paid News electoral offences with 2-year minimum punishment
• Making Electoral Bribery a cognizable offence with a minimum punishment of 2 years and power to
reprimanding of Polls by ECI on the grounds of Bribery.
• Power to Deregister Political Parties- Mandating Maintenance and Disclosure of Accounts by political parties.
• National Commission to Review the Working of Constitution (NCRWC): Recommends a 5 Member empowered committee for choosing the CEC, ECs comprising of PM, Lok Sabha Speaker, Deputy Chairman of Rajya Sabha, Leader of Opposition in both the houses.
• 2nd Administrative Reforms Commission:
• To decriminalize elections, if Charges framed by competent court for offences with minimum 5 years
imprisonment and cases are filed 6 months before elections, such candidates must be debarred from
• Special Election Benches for the disposal of Election Petitions and cases where lawmakers are involved.
• Law Commission in its various reports (170th, 244th and 255th):
• Define Paid News and make it an electoral offence.
• Bringing Political Parties under RTI.
CENTRAL BUREAU OF INVESTIGATION (CBI)
Currently, India’s apex anti-corruption agency is marred by Corruption Allegations, Internal Fights, etc.
Background: The CBI is the premier investigation agency of the country which derives its powers from Delhi Special Police Establishment Act-1946. The CBI formally came into being through a Home Ministry resolution in 1963. The CBI is headed by a Director who is usually an IPS Officer.
CBI is conferred with the responsibility to investigate a variety of crimes. The Broad categories of criminal cases which the CBI handles are as follows:
• Cases of corruption and fraud committed by public servants of all Central Govt. Departments, Central Public Sector Undertakings and Central Financial Institutions.
• Economic crimes including bank frauds, financial frauds, Import Export & Foreign Exchange violations, large-scale smuggling of narcotics, antiques, cultural property and smuggling of other contraband items etc.
• Special Crimes, such as cases of terrorism, bomb blasts, sensational homicides, kidnapping for ransom and crimes committed by the mafia/the underworld.
• Cases referred to it by the Supreme Court and High Courts: A total of 292 cases were referred to CBI in 2015 by the apexcourt and high courts.
• Cases referred to it by the State Governments: A total of 34 cases were referred to CBI in 2015 by the State Governments.
Significance of CBI vis-à-vis Lokpal, Central Vigilance Commission (CVC):
• Nature: While CVC, Lokpal are statutory bodies CBI is an Executive Body which draws its powers from Delhi Police Special Establishment Act-1941.
• Investigative Role: Lokpal, CVC are not investigative agencies themselves. They take the support of CBI to carry out investigations.
• Wider Domain: Lokpal, CVC mainly look into Corruption and Misappropriation of Funds by Public Officials. On the other hand, CBI looks into a wide range of offences including offences like Hawala, Sensational Homicides, etc.
• Dedicated Staff and State of Art Facilities: CBI has around 4000 employees as its sanctioned strength and it also employs latest training modules, technologies to enhance its investigation capabilities. While most of the work done under the CVC is by the Chief Vigilance Officer (CVO) who is a part of the parent Ministry or Department.
Challenges Faced in the Working of CBI
Despite enjoying good amount of trust among the general public, CBI faces plethora of challenges today:
• Lack of Functional Autonomy: Supreme Court referred to CBI as “Caged Parrot” for this very reason.
• Governmental Interference in its functioning: For instance, CBI director Ranjit Sinha submitted an affidavit in the Supreme Court that the coal-scam status report prepared by the agency was shared with the Law minister Ashwani Kumar before presenting it to court.
• Weak Parliamentary Oversight: The CBI is governed by the Government and is not under the supervision of the Parliament of India.
• No Statutory Backing: CBI unlike CVC is a body established using an Executive Order.
• No Separate Cadre: Officers join CBI through deputation, thus they are always at the mercy of the government which can transfer them back to their parent cadres.
• Partisan Probe: Current Controversy in CBI is mainly surrounded around partisan nature of investigation by the CBI by colluding with the accused.
• Permission of State Governments: Since Police and investigation are State Subjects, CBI needs the approval of State Governments to investigate in States. A fitting example is the withdrawal of general consent for CBI by Andhra Pradesh and West Bengal Governments recently.
Steps Needed to Empower CBI
The Motto of CBI is “Industry, Impartiality and Integrity”. To truly uphold this in letter and spirit, various measures are needed to be taken
• Second Administrative Reforms Commission recommends the following:
• Comprehensive Central Legislation should be brought defining the powers, responsibilities of CBI
• Providing it functional independence and insulating it from government intervention
• Parliamentary Oversight of CBI to ensure Accountability
• Dedicated Cadre with Security of Tenure
• Adequate Resources, Manpower to function efficiently.
Supreme Court Directives in Vineet Narayan Case, 1997
• CBI Director appointment by a Committee comprising of PM, CJI and Leader of Opposition.
• CVC will have general superintendence over CBI
• 2 years Security of Tenure for CBI Director irrespective of Superannuation.
• A document on CBI’s functioning should be published to provide the general public with a feedback on investigations and information for redress of genuine grievances.
• Establish a separate Directorate of Prosecution in CBI.
NATIONAL HUMAN RIGHTS COMMISSION:
Recently referred by Supreme Court once again as a “Toothless Tiger”.
National Human Rights Commission of India (NHRC), is a statutory body established in 1993, under the provisions of The Protection of Human Rights Act, 1993.
Mandate of NHRC:
It is responsible for the protection and promotion of “rights relating to life, liberty, equality and dignity of the individual guaranteed by the Constitution or embodied in the International Covenants.
• To inquire into HR Violations and also negligence in the prevention of such violations by the public servant
• To conduct Human Rights Research
• To give recommendations for effective implementation of International Treaties on Human Rights
• Creating Awareness on Human Rights
• Encouraging NGOs in the field of HRs Strengths and Successes
• It was successful in creating massive awareness of Human Rights in India. The Growing Complaints every year shows the popularity and trust of NHRC among the public.
• Played a crucial role in ensuring the rights of the disabled and HIV Patients.
• The NHRC is easily accessible via Phone, Letter, Internet, etc
• The Government must inform NHRC on the actions taken on its recommendations within a month.
• It has the Powers of a Civil Court with its own dedicated investigation staff.
• NHRC can take suo-motu cognizance of any complaints.
• Stringent Appointment and Removal Process to ensure its independence.
Weaknesses and Challenges
• Only a Recommendatory body with no power of prosecution.
• NHRC cannot investigate an event if the complaint was made more than one year after the incident.
• NHRC cannot penalise authorities which do not implement its orders.
• Limited Powers to investigate armed forces and paramilitary. Ex: AFSPA Violations.
• NHRC has negligible jurisdiction in Jammu and Kashmir which has its own State Human Rights Commission.
• Shortage of adequate number of trained staff to handle the growing number of complaints.
• NHRC incurs large expenditure on office expenses, leaving small amounts for research and rights awareness programmes.
• As non-judicial member positions are being filled by exbureaucrats, it is alleged that NHRC is more an extension of the government.
Step Needed to Empower NHRC
• There is a need for some kind of enforceability and contempt mechanism to ensure that its recommendations are adhered to
• Special Funds are needed for the purpose of Awareness Campaigns
• Inclusion of Armed Forces, Paramilitary and J&K Violations under its ambit
• Making at least some part of its expenditure as Charged Expenditure to ensure financial autonomy
• Further, there is a need to extend the Act to genuine human right violations even beyond one year of occurrence.
• RBI, ECI, CBI and NHRC are all key oversight bodies which play a crucial role in ensuring Good Governance and in the upholding of Democratic Values in the country. Thus providing an enabling
environment for them to function independently without fear or favour is the need of the hour today.
• It is thus the duty of the Parliament and Union Executive to empower them suitably through amendments in existing laws, through additional funds and functionaries.
• If this is done we can indeed move towards a New India which is Economically Strong, Participative, Corruption Free and a role model for upholding of Human rights.
…No Nation can become a Successful Democracy without having strong oversight bodies which can act as bulwarks of the Constitution…
Central Information Commission
• Current Scenario: Some concerns have been raised over the proposed amendments to the RTI through the RTI (Amendment) Bill, 2018 and long-term pending vacancies in CIC office.
• RTI (Amendment) Bill 2018: The govt. had planned to introduce this bill in the Parliament this year. The govt. has recently informed the Supreme Court about it.
• The salient features of RTI (Amendment) Bill, 2018:
• The Bill proposes to give the Centre the power to decide the tenure and salaries of State and Central
• Presently, as per the RTI Act, the salaries and allowance and other terms and conditions of service
of the Chief Information Commissioner (CIC) and Information Commissioners shall be same as that of
the Chief Election Commissioner (CEC) and Elections Commissioners, respectively.
• High vacancies:Further, the CIC presently is having eight vacancies (out of 11 posts), an all-time high. Similarly, a number of posts in the State Election Commissions (SIC) are also lying vacant. No appointments have been made in the CIC since 2016.
• Recently, the centre, while replying to a direction by the Supreme Court, informed that appointments to fill at least four vacancies on the CIC will be finalised in December this year.
• All this raises question on the effective functioning of the CIC.
The other issues faced by the CIC are:
• High level of case pendency: At present there are more than 26,000 cases pending in the CIC alone. The pending cases before the SIC are much more.
• Lack of Monitoring and Review mechanism: The Information Commissions spend most of their time in “hearings” and disposing-off appeals leaving little time and resources for monitoring the Public Authority for compliance of the RTI Act.
• NOTE:For detailed discussion of the proposed RTI (Amendment) Bill, please refer to the September, 2018 issue of the NextIAS current Affairs Magazine.
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