A pandemic like crisis naturally demands meticulous care, absolute impartiality and sheer stainless character in action. However even in this hour of peril the ruling party stooped further low by refusing to rise above pity politics and continuing with expanding its boundaries of authoritarianism. Whether it be through maligning an entire community for corona, pathetic inaction for poor interstate migrants or be its abysmal manner of executing the lockdown. At this juncture when the entire nation was looking up to the government to show empathy, be transparent, display promptness and sustain the confidence of fellow citizens, Modi government was busy capitalizing this crisis for its own profit.
Of these examples of misgovernance the case of the obscure PM CARES stands out as a bloat on the idea of state accountability in the largest democracy of the world. A fund that was set up to tackle the Covid crisis, presented as a hallmark of national unity, funded by citizens of the country is later relieved from any public scrutiny, begs serious questions on where the country is heading towards.
The Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund, also known as PM CARES Fund is a special fund announced by Prime Minister Modi to deal with the ongoing Covid crisis in an effective manner. The fund is dependent entirely on voluntary donations free from any budgetary support. The Prime Minister heads the fund in his official capacity, and can nominate three eminent persons in relevant fields to the Board of Trustees.
So far this fund has proven to be highly successful in attracting donations from all walks of life, whether it be from influential celebrities, public and private industries or even children contributing from their meager savings. The magnitude of its success can be understood by the fact that in the first 52 days the fund successfully amassed $1.27 billion.
More than the emotional quotient around the crisis and a national will of coming together, what attracted major large scale donations to this fund was the tax free incentive. In addition to its tax free benefit the fund was also exempted from the Foreign Contribution Regulation Act, 2010 (FCRA). For companies these funds were also counted against CSR obligations.
Now what dropped as a shock was the government’s refusal to subject these funds to any public scrutiny. In its ironical response to the RTI demanding accountability of funds the government said that the fund was not a “public authority”, even though the PM is its ex-officio chairman and three Cabinet ministers are its trustees, all of whom are public servants. Defending the government for its stance, the Supreme Court of India in its statement said that the PM CARE fund was a public charitable trust set through “voluntary donations” therefore it was not applicable for a CAG audit.
While ostensibly it may seem that the government has been able to take the right line of defense in fending off any opposition to its non-accountability of the funds. But when examined thoroughly some serious questions are raised regarding various dimensions of the fund that have remained unanswered.
Of the many contentions on the PM CARES fund, including the veracity of claim of “voluntary” donations, exemption from audit, shady spending and more, what has been brazenly ironical, is the fat donations by companies, struggling to even sustain themselves. These companies are severely cutting costs to withstand the heavy blow from corona, by: Cutting salaries of employees, putting any fresh recruitment on hold, putting increments on hold, putting variable payouts on hold, Postponing vendor payments, Postponing payments to contract workers and casual labourers, firing employees etc.
Take the example of Reliance industries itself. Even after recent lucrative deals with Facebook and PE giant Silver Lake, the company announced salary cuts for its employees. Yet, it contributed Rs 500 crore to PM Cares.
Larsen & Toubro another technology, engineering, construction, manufacturing and financial services conglomerate, announced to donate ₹150 crore to the PM-CARES Fund, while its own daily wage workers were found protesting later for nonpayment of their wages.
In another case, Cure.fit. a fitness startup company, fired around 800 employees and closed down many of its fitness centers. While on the other hand it generously donated Rs 5 crore to PM Cares and various other relief funds.
38 PSUs that donated to PM CARES
An example of weakening federalism of the country can be understood by the fact that PSUs like Coal India committed 221 crore rupees to the fund while it would not contribute to the state relief funds of Bengal and Jharkhand which account for all of its business.
Such duality in character by these industries raise some fundamental questions on how independently do actually these businesses operate and what is the level of intimidation by strong central governments? According to many experts it’s a survival mechanism for these businesses. If companies wish to run smoothly for a long haul they will try to remain in the good books of the government even if it be at the cost of their own employees.