Supreme Court Criticizes Pre-Election Freebies and Cash Transfers, Urges States to Focus on Employment and Long-Term Development
New Delhi: The Supreme Court of India on Thursday strongly criticized the growing practice of state governments announcing free schemes and direct cash transfers to voters just before elections.
The Court observed that such measures, if left unchecked, could adversely impact the country’s economic stability and long-term development.
A bench comprising Chief Justice Surya Kant, Justice Joymalya Bagchi, and Justice Vipul M. Pancholi questioned the timing and sustainability of such welfare announcements, noting that they often surface suddenly ahead of elections.
“Political Parties Must Reconsider Their Policies”
The Chief Justice acknowledged that in a welfare state, governments have a responsibility to assist citizens who genuinely cannot afford basic expenses. However, he cautioned that blanket freebies often end up benefiting those who do not require such support.
“We understand that when some people cannot bear expenses, the State must assist them. But those who already have sufficient means are often the first to benefit from free schemes,” the bench observed.
The Court urged political parties, leaders, and policymakers to rethink their approach and evaluate the broader cultural and economic consequences of such practices.
Concern Over Direct Cash Transfers
Referring to recent state elections, the bench noted that several welfare schemes were announced abruptly just before polling.
The Chief Justice raised a pointed question: if direct cash transfer schemes are announced and money is deposited into bank accounts, what incentive would remain for people to work?
The Court emphasized that unchecked distribution of cash and freebies could undermine productivity and weaken the economic foundations of the country.
“What Culture Are We Creating?”
The bench also questioned the broader societal impact of indiscriminate subsidies. It asked what distinction remains between those who are capable of paying their electricity bills and those who genuinely struggle to do so, if the State absorbs bills across the board.
Addressing senior advocate Gopal Subramanium, who appeared for the Tamil Nadu government in a matter concerning absorption of electricity bills, the Court remarked that the issue was not confined to one state but extended to all state governments.
“What culture are we developing?” the Chief Justice asked, emphasizing that welfare measures must be carefully targeted toward the marginalized rather than universally applied.
Use Revenue for Development, Not Freebies
The bench expressed concern over states running fiscal deficits while simultaneously announcing free schemes.
It questioned where the funding for such largesse was coming from and why those resources could not instead be invested in infrastructure and development.
The Court suggested that state governments should prioritize long-term planning for roads, irrigation, power supply, hospitals, schools, and employment generation rather than offering short-term electoral incentives.
Addressing Tamil Nadu specifically, the bench remarked that even if the state has a revenue surplus, it bears responsibility to allocate funds toward overall public development rather than distributing free benefits indiscriminately.
The Court also issued notice to the Central Government seeking its response in the matter. These observations were made during the hearing of a petition filed by the Tamil Nadu Power Distribution Company Limited challenging Rule 23 of the Electricity Amendment Rules, 2024.
Duraisamy’s Election Petition Reserved for Judgment
Separately, the Supreme Court reserved its verdict on an election petition filed by Saidai S. Duraisamy, a leader of the All India Anna Dravida Munnetra Kazhagam, against Tamil Nadu Chief Minister M. K. Stalin. The bench heard arguments from both sides before reserving its decision.
CAA Petitions to Be Heard from May 5
In another significant development, the Supreme Court announced that it will begin final hearings from May 5 on more than 200 petitions challenging the constitutional validity of the Citizenship Amendment Act (CAA), 2019, including the lead petition filed by the Indian Union Muslim League.
The Court issued procedural directions for the long-pending petitions, some of which have been awaiting hearing since 2019–2020, and indicated that arguments are expected to conclude by May 12.
The Court’s remarks signal growing judicial concern over the fiscal and ethical implications of pre-election giveaways, urging governments to shift focus from short-term populism to sustainable growth and employment generation.
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