BRS posts highest income among regional parties for FY24, Rs 430 crore remains unspent: ADR report

Hyderabad: As per an ADR report analysing the income and expenditure of regional political parties for FY 2023-24, BRS reported the highest income of Rs 685.5177 crore, which forms 27.07 per cent of the total income of the 40 parties analysed.

BRS was followed by AITC with an income of Rs 646.392 crore (25.53%) and BJD, whose income was Rs 297.806 crore (11.76%) of the total income of the 40 regional parties analysed in this report.

Interestingly, the report by the Association for Democratic Reforms (ADR) also states that BRS has more than Rs 430.6032 crore of its total income remaining unspent

Which parties have declared their financials?

The ADR report analyses the total income and expenditure incurred, all over India, by 40 out of the 60 Regional Parties during FY 2023-24, as declared by the parties in their audit reports submitted to the ECI.

The Regional Parties include Apna Dal (Soneylal), AIFB, AINRC, AIADMK, AIMIM, AIUDF, AJSU Party, AGP, BJD, BRS, CPI, CPI(ML)(L), DMK, DMDK, GFP, INLD, JD(S), JD(U), JJP, JKPDP, JMM, KC(M), LJP (Ram Vilas), MGP, MNS, MNF, NDPP, NPF, PPA, Rashtriya Loktantrik Party, Revolutionary Goans Party, SAD, SDF, SKM, SP, TDP, TMP, YSR Congress and ZPM.

Financials of 20 parties are not available on ECI website

The due date for submission of annual audited accounts for the parties was October 31, 2024.

However, 20 parties had submitted their audit reports on time, while 20 parties delayed their submission by several days, ranging from 12 days to 216 days.

Audit reports of the remaining 20 regional parties for FY 2023-24 are unavailable on the website of the ECI at the time of preparation of this report, even after a delay of 313 days (as on September 10).

These include Zoram Nationalist Party, Nationalist Congress Party, Bodoland Peoples Front, United People’s Party, Liberal, Lok Jan Shakti Party, Rashtriya Janata Dal, Rashtriya Lok Samta Party, Janta Congress Chhattisgarh (J), Jammu & Kashmir National Conference, Jammu & Kashmir National Panthers Party, Indian Union Muslim League, Shiv Sena, Shiv Sena (Uddhav Balasaheb Thackrey), Hill State People’s Democratic Party, People’s Democratic Front, Voice of the People Party, United Democratic Party, Indigenous People’s Front of Tripura, Revolutionary Socialist Party and NCP (Sharadchandra Pawar).

Hence, this report analyses the income and expenditure of 40 regional political parties, whose audit reports are available on the ECI website for FY 2023-24.

The income of the top five regional parties amounted to Rs 2,105.8286 crore

The total income of the top five parties amounted to Rs 2,105.8286 crore, which comprised 83.17 per cent of the total income of the political parties analysed collectively.

BRS reported having the highest income of Rs 685.5177 crore, which forms 27.07 per cent of the total income of all the parties analysed, followed by AITC with an income of Rs 646.392 crore or 25.53 per cent and BJD, whose income was Rs 297.806 crore or 11.76 per cent of the total income of the 40 regional parties analysed in this report.

23 parties have shown an increase in their income; TDP came second

AITC reported the highest increase in its income of Rs 312.935 crore, followed by TDP and BJD, which declared a total increase of Rs 221.076 crore and Rs 116.753 crore, respectively, between FY 2022-23 and FY 2023-24.

For 39 parties out of 40 political parties whose data is available for both years, 23 parties have shown an increase in their income, while 15 parties have shown a decline in their income during this period.

Total income of the 39 parties increased from Rs 1,736.851 crore in FY 2022-23 to Rs 2,531.802 crore in FY 2023-24, a total increase of 45.77 per cent or Rs 794.951 crore.

It is to be noted that the Goa Forward Party has declared zero income for the same period.

BRS has yet to spend Rs 430.6032 crore of its total income

BRS has more than Rs 430.6032 crore of its total income remaining unspent, while AITC and BJD have Rs 414.9195 crore and Rs 253.7964 crore, respectively, of their income remaining unspent for FY 2023-24.

As many as 27 regional parties declared a part of their income as unspent for FY 2023-24, while 12 political parties spent more than the income collected during the year.

YSR-Congress among parties that spent more than their income

YSR-Congress has declared spending the highest amount of Rs 104.7235 crore, or 54.82 per cent more than its income.

The other parties in this category include DMK, SP, JD(U), SAD, CPI(ML)(L), LJP (Ram Vilas), AIFB, MNF, NPF, PPA and MGP are the 12 regional parties that declared spending more than their income.

Goa Forward Party is the only party which has not declared any income for FY 2023-24, but the party has declared expenses during this year of Rs 1.56 lakh.

YSRCP first in party expenditure, followed by BRS

The total declared expenditure of the 40 regional parties for the FY 2023-24 was Rs 1,320.96 crore.

YSRCP topped the list of parties with the highest expenditure, with Rs 295.7664 crore spent or 22.39 per cent of the total declared expenditure.

This was followed by BRS, which spent Rs 254.9145 crore or 19.298 per cent, AITC, which spent Rs 231.4725 crore or 17.523 per cent, DMK, which spent Rs 200.0677 crore or 15.146 per cent, and TDP spent Rs 121.098 crore or 9.167 per cent of the total expenditure.

Total expenditure incurred by the top five parties is Rs 1,103.3191 crore or 83.52 per cent of the total expenditure as reported by the 40 political parties.

The most common and popular items of expenditure for regional parties for FY 2023-24 are administrative and general expenses and election expenditure.

70% of the income for parties was through Electoral Bonds

More than 70 per cent of the total income (Rs 1,796.024 crore) of the 40 regional political parties analysed for FY 2023-24 came from donations through Electoral Bonds.

As many as 40 regional parties collected Rs 2,117.846 crore or 83.64 per cent of their total income from voluntary contributions (including donations and contributions and Electoral Bonds) for FY 2023-24.

Under voluntary contributions, political parties collected 70.93 per cent or Rs 1,796.024 crore of their income from donations through Electoral Bonds, while other donations and contributions amounted to Rs 321.822 crore or 12.71 per cent for FY 2023-24.

The share of other sources of income declared by regional parties is Rs 414.25 crore, which is 16.36 per cent of the total declared income.

Only 10 of the 40 regional parties that were analysed declared donations through Electoral Bonds amounting to Rs 1,796.024 crore.

As much as 10.86 per cent or Rs 274.898 crore of the total income was generated through interest income by the 40 regional parties during FY 2023-24.

Electoral Bonds worth Rs 4,507.5613 crore were redeemed by parties

As per the data shared by SBI in response to ADR’s RTI application, Electoral Bonds worth Rs 4,507.5613 crore were redeemed by parties in FY 2023-24. 55.998 per cent (Rs 2,524.1361 crore) of this has been redeemed by national parties, and 39.84 per cent (Rs 1,796.024 crore) is redeemed by regional parties.

For FY 2023-24, only three National Parties (BJP, INC and AAP) have received donations through Electoral Bonds (Rs 2,524.1361 crore).

Of the regional parties that have submitted their audit reports, 10 regional parties (BRS, AITC, BJD, TDP, YSR-Congress, DMK, JD(S), SKM, JMM and SDF) have declared receiving donations through Electoral Bonds worth Rs 1,796.024 crore.

Why is it important for parties to disclose financials?

Political parties have multiple sources of funding, and thus, accountability and transparency should be important aspects of their functioning. It is essential to have comprehensive and transparent accounting methods and systems, which should reveal the true financial position of the parties.

The Election Commission of India (ECI), in its letter dated November 19, addressed to the Presidents/General Secretaries of all political parties, stated that the parties needed to submit details of their audit reports to the Commission.

Recommendations of ADR

- All political parties must provide all information on their finances under the Right to Information Act.

- The Election Commission of India impose rules that no part of the Form 24A submitted by political parties providing details of donations above Rs 20,000 should be left blank.

- Full details of all donors should be made available for public scrutiny under the RTI.

- Any party which does not submit its IT returns on or before the due date, its income should not be tax-exempt and defaulting parties should be derecognised.

- Parties not following the ICAI guidelines for auditing of reports should be scrutinised by the IT department.

- Penal or stringent action (instead of only sending reminder letters) to be taken against recognised political parties for delaying or defaulting on the submission of their audit and contribution reports each year.