Media News Archive
By Jayaprakash Narayan
Today in India, there is a certain lynch mentality. We are willing to believe the worst about those in public office, be it politicians, bureaucrats or judges. That unless proved otherwise, the fellow is a thorough crook. This is not a very happy situation. We can understand why it has come about. People are vexed, there is a terrible crisis of legitimacy and monumental corruption. There is enormous anger.
But then there are also bonafide acts by officials which go wrong. Many a time due to the pressure of doing one hundred things at the same time, things do go wrong. No human being can say he will always be perfect. You must acknowledge that there is an inherent possibility of error in government decisions.
As long as there is no criminal intent and due diligence is done which essentially means reasonable exercise of caution, you cannot hold a person's decision wrong in hindsight. At best you could order a departmental enquiry, a rap on the knuckles. Corruption is a matter of criminal intent and an objective person should be able to distinguish between the two.
Now if each segment keeps saying that while I may be guility, you should first go after him, it is not right. I remember a R K Laxman cartoon many years ago saying the enquiry report has come and that the report says no one in the country is guilty of any wrong and that whatever is happening in the country is happening on its own !
The country is in an awful mess and let us first acknowledge that. We have third rate governance. People are not getting what they are entitled to. There is monumental inefficiency and corruption. There is arrogance of power and delay.
But the IAS officers should not behave as if they are peons and clerks. The IAS has awesome prestige and authority and protection under the Constitution of India. This class of people are chosen from among thousands of people. At the age of 30, you give them immense power over 3 million people in a district where they get to play a significant role in legislation and implementation of policy.
Now if they turn back and say we have nothing to do with the decisions, that is not the right thing to do. I agree that the politician must be hanged from the nearest lamp post, after due process of law. I am all for it. But the IAS officer cannot say that he is just a small fish and I was told to do this and that, therefore I did.
The IAS officer takes an oath to protect the Constitution of India, not to protect partisan interests. If he is being asked to pass a wrong order, he must resist.
A clerk and a police constable can say he is a mercenary but the DGP, or an SP or IAS officer cannot claim that. If they behave like clerks, the system will collapse as they will be undermining themselves.
We have to protect the honest officers from vindictive witchhunt. But more importantly, we have to protect society because today it is not the officer who needs protection. It is Indian society that needs protection from the governing classes because they have been governed very poorly.
(Jayaprakash Narayan is a former IAS officer and now President of Loksatta Party. He is an MLA in the Andhra Pradesh assembly)
The underlying principle of the Supreme Court's landmark verdict to annul 2G licences should extend to all scarce natural resources.
The Supreme Court decision in two writ petitions filed by Loksatta and several eminent citizens, and Dr Subramanian Swamy, cancelling 122 licenses of 2G spectrum, gives a tremendous boost to the fight against collusive corruption.
In October 2010, Loksatta launched a campaign to cancel licences. A letter was sent to the Prime Minister urging cancellation on the following grounds:
The corporates which colluded with bribe-takers and caused a colossal loss to the Exchequer shouldn't benefit from corruption. A contract tainted by corruption, ineligibility of licensees and arbitrariness, and has caused injury to public property is void, because the consideration or purpose of agreements is unlawful as per Sections 23 and 24 of the Indian Contract Act, 1872.
The Parliament and Government have sovereign powers to undo the wrong. When legitimate private assets could be nationalised as a matter of public policy, it would be perfectly legitimate and necessary to revoke licenses secured in a corrupt and arbitrary manner, causing loss to the Exchequer.
THE GRAVY TRAIN
In her article ‘Spectrums of Taint' (Business Line, November 16, 2010), the author quoted Loksatta extensively, arguing in support of cancellation of licences. In December 2010, we urged several prominent citizens to join in filing a writ petition in the Supreme Court to cancel the licenses. Mr J .M. Lyngdoh, Mr T. S. Krishnamurthy, Mr N. Gopalaswami — all former CECs, Mr P. Shankar, former CVC, Mr Julio Rebeiro, former IPS officer, and Admiral R. H. Tahiliani, Mentor, Transparency International India joined the effort, and Prashant Bhushan, senior advocate, took up the case on our behalf.
The verdict of February 2 has profound implications for the future, encompassing a whole range of issues involving allotment of land, mining leases and dispensation of other state patronage at national and state levels. There are those who argue that cancellation of licences might send a wrong message to foreign investors and MNCs. This isn't true.
Even if there are short-term complexities, in the long term, fair competition, transparency, and rule of law will promote investment and growth. Many investors do business in India with great difficulty, and try their best to distance themselves from ubiquitous corruption by creating several buffers — consultants, Indian partners and professionals who deal with corrupt bureaucrats and politicians. If this verdict leads to a healthy, fair, competitive business environment and transparent decision-making, everybody gains.
Which is a better policy — auction or first-come-first served? Ideally, auction of scarce natural resources should be the norm. If tariffs are likely to go up on account of exuberant market sentiment and overbidding and over-pricing, then the bidding could be for revenue sharing or some other appropriate model, not for licence fee. Non-competitive processes are highly prone to collusive corruption, as the 2G case has amply demonstrated. The arbitrariness, change of rules at will, entry of players who have nothing to do with the telecom sector, sale of spectrum for windfall profits days after allotment without any value addition, and other facts and circumstances that have come to light in the 2G spectrum case clearly demonstrate the corrupt behaviour of decision-makers and corporates.
In respect of allotment of precious lands, and mining leases, competitive bidding must be the norm. For this, the mining law needs to be amended. Supreme Court verdict should be made applicable to allocation of all scarce natural resources; Gali Janardhana Reddy and the like, and many land sharks in the guise of industry should be subjected to the standards set by Supreme Court in this landmark case.
What other steps should we take to curb collusive corruption and to protect public revenues? Three specific steps are needed now. First, a law should be enacted by Parliament making all contracts involving corruption, or a loss to the Exchequer, void and unenforceable. This will remove all incentives for corporates to bribe any public official to get a favour. A company that loses the bribe amount as well as the business or benefit or favour received through corruption is unlikely to resort to bribery. Only then can we demand corporate integrity and create a level playing field.
Second, a windfall profit tax should be imposed on all those who secured a license or mining lease or other natural resource, and made huge profit without value addition. This will ensure that excess profits made out of a vital public resource are retained with the Exchequer, and aren't appropriated by private interests. Mere private monopoly of public assets shouldn't be a source of unusual profits, even if there is no corruption in the transfer of asset. Such a windfall profit tax was imposed in the UK in 1997, in respect of North Sea Oil, and the monopolies in electricity, telecom, airports, gas, water, and railway sectors.
Third, a law similar to the False Claims Act in the US should be enacted in India. This law allows imposition of a civil penalty five times the loss sustained by the Exchequer in any public procurement or transfer of natural resource.
If a product is overpriced relative to the best customer of the company, or the asset is underpriced while transferring from State to a Corporate, or there is compromise in quality or environmental damage, or the Exchequer has lost money through fraud, bribery or wrongdoing, then any citizen can file a claim, and a court after hearing is empowered to impose five times the loss as penalty. The citizen gets a share of the penalty as incentive. Under the False Claims Act in the US, more than $24 billion has been recovered from corporates during the past 23 years, in 10,650 cases.
We need to move beyond the politics of the 2G case and corruption scandals. Systematic, far-sighted, practical steps are needed to curb collusive corruption. The Supreme Court verdict is an important first step to cleanse our system.
(The author, Dr.Jayaprakash Narayan, is the founder of Lok Satta movement, and former member of Second Administrative Reforms Commission.)
Courtesy: Business Line