Name- Snehal Rajaram Shinde, Gopaldas Jhamatmal Advani Law College
Linkedin- https://www.linkedin.com/in/snehalshinde1121
To the point
The article consists about Introduction, where the ongoing case in Supreme Court about the homeless persons shelter in urban areas is mentioned. Further the difference between the freebies and welfare schemes is mentioned. Also, reasons in which freebies foster parasitic lifestyle are mentioned, such as, the role of freebies in eroding structure of democracy, economic effect, how to freebies affect the people is mentioned. Various judicial cases are also mentioned in this article. Also, case of Sri-Lanka is mentioned, where freebies played an important role in economic instability of the country. The article concludes with way forward and possible solutions.
Abstract
This article explains the issue of freebies, which came into picture after a case was filed in the Supreme Court for the matter on right to shelter homeless persons in urban areas. The supreme court questioned about the issue of freebies fostering parasitic lifestyle for the poor. This article also explains about economic as well as judicial perspective of freebies. It also mentions about the case of Sri-Lanka where freebies play a major role in economic instability of the country.
Introduction
On 12 February 2025, a petition on matter on “right to shelter homeless persons in urban areas” was filed by Mr. E.R. Kumar, Mr. Prashant Bhushan and others, in the Supreme Court. The bench consisting of Justice B.R. Gavai and Justice Augustine George Masih. The bench also said that, people are not willing to work because of freebies. Because of freebies in Maharashtra, which they announced just before elections, agriculturists are not getting any labourers. The petitioner supported freebies, highlighting the issue of unemployment, and implying use of freebies is no wrong, since people are not getting work.
The “Ladki Bahin Yojana”, which was announced just before elections in Maharashtra, promising women from 21 to 65 years of age, who have income less than 2.5 lakhs yearly, a monthly sum of Rs. 1500. Also, amidst Delhi elections in January 2025, various political parties promised pension for women, subsidized LPG cylinders, pension for old aged people, free education for children, pension for pregnant women and various such promises to vulnerable sections of the society, various government schemes which give money like the Attal Pension Yojana giving Rs. 1000 till age of 60.
Also, in December 2024, bench of Justice Surya Kant and Justice Manmohan, was surprised when it was informed by the Centre that, 81 Crore people are being given free or subsidized ration under the National Food Security Act of 2013.
Difference between welfare scheme and freebies-
According to RBI report 2022 freebies have been defined as, “a public welfare measure that is provided free of charge”. The freebie culture is also called as “revdi culture”. Freebies are promises made by political parties just before elections to lure the voters. The promises such as free mixers, cash, laptops, mobile, scooters. The freebies culture has its beginning from Tamil Nadu where parties were offering free television, grinders, etc.
Welfare schemes on the other hand, have long-term benefit for the population, they improve their standard of living. They promote social justice, equity and development. Schemes such as Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), which provide at least 100 days of guaranteed wage employment to every rural household for adult members doing unskilled work. The achievements of MGNREGA include, the scheme helped in compensating 20-80% of the income loss incurred because of the Covid-19 induced lockdown, as per a study conducted by Azim Premji University across four states (Bihar, Karnataka, Maharashtra and Madhya Pradesh).
The Pradhan Mantri Jan-Dhan Yojana (PMJDY) which is ensuring access to various financial services like availability of basic savings bank account, access to need based credit, remittances facility, insurance and pension to the excluded sections i.e. weaker sections & low-income groups.
How are do freebies foster parasitic lifestyle-
The RBI Report on State Finances (2022), stated that the subsidy has drastically increased leading to financial instability, many states are running large fiscal-deficits which could impact their ability to fund long-term infrastructure projects.
1)Effect of freebies in eroding structure of democracy-
If there is more focus on freebies, it can lead to the dominance of the executive branch government. Article 50 of the constitution states separation of judiciary from the executive, Article 212 states about legislative autonomy. If the executive branch dominates due to freebies, it may lead to influence of executive over the budget decisions, policymaking, which will weaken the checks and balances system which are part of separation of power.
Freebies may lead to economic instability, if their distribution is not balanced properly. The concept of rule of law, also includes promotion of economic opportunity. If the government runs constantly in budget deficit to fund freebies, it will be a challenge to maintain economic stability, which is critical component of rule of law. Selective distribution of freebies may lead to discrimination to certain weaker section of the society, which will erode public trust in the system of democracy. The Directive Principles of State Policy act as a lamp to political parties in policy making. But when the political parties offer to deliver freebies, the attention of the voters to critical issues is diverted. This will reduce the overall accountability of the elected candidates.
2)Economic effect-
In 2020-21, state’s fiscal deficit limit was increased to 5 per cent of GDP due to the adverse impact on revenue receipts because of the Covid-19 pandemic. Outstanding liabilities of states were estimated at 29.5 per cent of the GSDP at the end of 2022- 23 as against 26.7 per cent at the end of 2019-20.
When individuals receive benefits such as free electricity, transportation, or cash transfers, their purchasing power rises. The consumer demand will increase for goods and services in this regard. As demand surges due to increase in purchasing power, it can overcome the supply capabilities, leading to demand-pull inflation. High demand for goods and services will exceed the supply and this phenomenon will occur. Offering free services like electricity, water, transportation, and cash transfers to large segments of the population can lead to skyrocketing costs for state governments. For example, the Tamil Nadu government’s promise of free bus rides for women was estimated to cost over ₹1,200 crore annually. Such commitments are difficult to sustain over time without significant revenue increases.
3)How do they affect people-
Freebies deem to foster a parasitic lifestyle among the poor, rather than making them contribute in the development of nation. They drain in their will to find work. The working capacity of the young people is reduced. The “Ladki Bahin Yojana” announced by the Maharashtra government is making those sisters into “Lachaar Bahin rather than making them Ladki Bahin and self-sufficient and independent bahin”. There is no employment source created in this scheme, which will make the sisters self-sustained and live their life with dignity. The scheme is rather making them dependent on the government for the money. The tax-payers money is used by the government in freebies, rather than long-term development projects. The funds to schemes such as MGNREGA, have been reduced which actually show long term benefits. This is leading to high taxation, slow economic growth and reduce capital for essential public services. If the electricity and water is given for free, people may become careless about their use. These valuable resources may be used carelessly by some people.
Judicial Perspective-
In Subramaniam Balaji v. State of Tamil Nadu (2013), the landmark judgment addressed the legality of promises made by political parties to provide freebies, such as colour televisions and kitchen appliances, during election campaigns. The Supreme Court ruled that such promises do not constitute corrupt practices under the Representation of the People Act, 1951.
However, in the ongoing case of Ashwini Kumar Upadhyay v. Union of India (2022), advocate Ashwini Kumar Upadhyay filed a Public Interest Litigation (PIL) seeking a ban on political parties promising freebies during elections. The petition argues that such practices amount to bribery and violate fiscal responsibility principles. Supreme Court’s has expressed concern over the potential impact of freebies on state finances and electoral fairness. It has issued notices to the Election Commission of India (ECI) and the central government to respond to these concerns.
International perspective-
Freebies were a major contributor in the Economic Crisis faced by the Sri-Lanka Government. In an effort to win elections, the Sri Lankan government implemented massive tax cuts that severely reduced government revenues. such policies undermined fiscal sustainability, which resulted in rise of Sri-Lanka’s debt-to-GDP ratio. The report of the International Monetary Fund in 2022 stated that the debt to GDP ratio of Sri-Lanka was approximately 116%, which indicated that the country owned more than its entire annual economic output.
Way Forward-
There should be a balance between these schemes and long-term development projects.
The Representation of People’s Act 1950 was enacted by the parliament to regulate matters relating to elections. Corrupt practices are mentioned in Section 123 of the Representation of People’s Act 1950. The inclusion of freebies should be included in ROP Act 1950 and stricter punishments should be imposed. Also, taking the example of Ladki Bahin Yojana, this scheme can be improved by providing employment for women upto age of 50 years and giving Rs.1500 to women above 50 years. This will create employment for young women and also provide relief for old women. Instead of providing money directly, the government can put-forth conditions like “plant a tree”, and then get the benefit, this will also encourage environment protection. The bus transport should be made free for students, who actually need it. More focus should be on cleanliness of bus stands, providing regular buses, security at such places. This will force the political parties to promise for long term benefit schemes, rather than distributing “revdis”.
FAQS
1. What is the key difference between welfare schemes and freebies?
Freebies are short-term, election-time promises like free mixers, TVs, or cash made by political parties to attract voters. Welfare schemes, on the other hand, aim at long-term development, social justice, and upliftment—like MGNREGA or Pradhan Mantri Jan-Dhan Yojana—which create employment and ensure financial inclusion.
2. How do freebies impact the economy of a state or country?
Freebies increase fiscal deficits and lead to economic instability. They raise consumer demand without corresponding supply growth, causing inflation. Additionally, they divert funds from productive infrastructure and essential services, making such commitments unsustainable.
3. What does the Supreme Court say about the culture of freebies?
In Subramaniam Balaji v. State of Tamil Nadu (2013), the Supreme Court ruled that promises of freebies during elections are not corrupt practices under the Representation of People Act. However, in Ashwini Kumar Upadhyay v. Union of India (2022), the Court raised concerns over the financial and democratic impact of freebies and sought responses from the Election Commission and the Centre.
4. How can freebies foster a ‘parasitic lifestyle’ among the poor?
Freebies can reduce the incentive to work, especially if people become reliant on government handouts. For example, schemes like the “Ladki Bahin Yojana” offer direct cash transfers without creating employment, potentially reducing self-reliance and productivity among beneficiaries.
5. What is a suggested way forward to address the freebie culture?
Freebies should be regulated through amendments to the Representation of People Act, 1950. Schemes should be conditional (e.g., “plant a tree” to receive benefits) and employment-generating. Free services should be targeted (e.g., free transport for students), and political focus should shift to long-term developmental goals.
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