The Supreme Court of India on Thursday delivered a sharp rebuke to the growing culture of political “freebies”, warning that indiscriminate distribution of largesse by States was hurting the country’s economic development and work culture.
Hearing a plea filed by Tamil Nadu Power Distribution Corporation Limited, which proposed to provide free electricity to all irrespective of financial status of consumers, the top court said it was understandable for governments to "hand-hold the poor", but providing free electricity and other benefits to all consumers without assessing financial capacity amounted to an appeasement policy.
A bench comprising Chief Justice Surya Kant and Justices Joymalya Bagchi and Vipul M Pancholi observed that most States were already revenue-deficit but continued to announce free food, cycles and electricity instead of investing in employment generation and development projects.
“The economic development of the nation will be hampered by this kind of largesse distribution. It is the State’s duty to provide welfare, but those who are enjoying freebies, is that not something which needs to be examined?” the Chief Justice orally remarked, questioning why States were loosening purse strings even after notifying electricity tariffs.
The bench further cautioned that excessive reliance on freebies could erode work culture. “If you start giving free food from morning to evening, then free cycles, then free electricity, who will work? And what will happen to the work culture?” the CJI asked, adding that States appeared to be doing little beyond paying salaries and distributing largesse.
At the same time, the court clarified that its concern was not directed at any one State but had wider national implications. Justice Bagchi said States should place planned and structured welfare expenditure before legislatures, with clear budgetary justification, particularly for unemployment and development-oriented schemes.
The observations came while hearing the Tamil Nadu power utility’s challenge to Rule 23 of the Electricity (Amendment) Rules, 2024, framed by the Centre. The rule mandates cost-reflective tariffs and restricts the revenue gap between approved annual revenue requirement and estimated revenue from tariffs to 3%, except in cases of natural calamity.
The Tamil Nadu government has argued that the sustainability mandate directly affects its policy of providing free and subsidised electricity. In its plea, it has sought quashing of the rule, contending that it is arbitrary, unconstitutional, violative of Article 14 and ultra vires the Electricity Act, 2003.
The Supreme Court has issued notice to the Centre and other respondents on the plea and sought their response.
(With input from PTI, ANI)