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Views: 913 | 09-12-2011 #1
Right to Information - Public money in private hands
An article by U D Choubey in financialexpress.com on 12 Sep 2011:
Right to Information -
Public money in private hands
Corruption has not remained a preserve of the government sector as many unfolding scams in the non-government corporate sectors would testify. The increasing number of public-private-partnership (PPP) projects, privatisation of the once-government controlled sectors and the rising public participation in equity issues make a case for extending the sphere of the Right to Information (RTI) Act to the non-government corporate sector.
As many as 18 countries have already brought the private sector under some version of RTI. Though the legislative ambit varies from country to country, generally all those who do public service, including social service, have been brought under RTI. These countries are South Africa, Angola, Armenia, Colombia, the Czech Republic, the Dominican Republic, Estonia, Finland, France, Iceland, Liechtenstein, Panama, Poland, Peru, Turkey, Trinidad & Tobago, Slovakia, and the UK. The Public Information Act of Estonia, for example, covers state and local agencies and private entity conducting public duties, including education, healthcare, social and public service.
In India, the social sector, which has seen a mushrooming growth of non-governmental organisations (NGOs), must also be brought under the RTI Act, as the operations and funding of many of them are not transparent and out of public domain. A social audit of NGOs may reveal the true story in the social sector. Similarly, non-government R&D sector has always been a subject of concern because of tax-evasion in the name of R&D incentives. It would not be a bad idea to bring all R&D expenditures, whether private or public, under RTI.
The concept ‘Freedom of Information’ found embodiment in India in the form of Right to Information Act, 2005. The Act applies to all states and Union territories (except J&K which is covered under a state-level law). Under RTI, any citizen can request information from a “public authority”, which is bound to furnish the same. The Act has brought greater accountability and transparency in the government sector. Time has come to explore whether the scope and area of RTI action need to be widened.
The RTI Act covers only the government sector, including public sector enterprises, broadly based on the premise that the sector uses 'public money.' But doesn't public money include money invested in public-listed companies? Doesn't it involve public finances received by companies through banks and financial institutions--whose nominees are directors on company boards? Similarly, contributions made by PSEs under corporate social responsibility (CSR) to NGOs are nothing but the tax-payers' money.
A wider extension of the RTI Act would not only further the objective of RTI to bring greater transparency and accountability to our political, economic/commercial sectors, but would also foster a system of increased responsibility towards citizen’s overall welfare from all sectors, public and private.
Under the PPP model and in the the continuing liberalisation process, more and more areas are being opened up to private participation. Banking, telecommunications, education and insurance are some of the sectors where privatisation has taken place, and this has brought about a gradual shift of service deliverables from public to private sector. To exclude the private sector from RTI’s domain would mean a massive loss of claim over information previously held in public sectors.
The magnitude of influence of the private sector on economic assistance must be commensurate with the magnitude of information shared for public consumption. If such information is available as citizens' right, it is sure to bring about a healthy transition from a system of secrecy to a system of transparency.
A start can be made by bringing corporates which have considerable public funding—where nominees of public sector banks/institutions are on the board of directors and where shares are listed on the stock exchanges — and which take up PPP projects under the RTI Act.
Over and above, PSEs have been crying for a level-playing field with private sector corporates. The time has come to extend the RTI Act to the non-government sector. The sooner the better.