COVID-19 has created chaos and havoc across the globe. Businesses are struggling to sustain in this crisis. Governments are striving to come up with effective policies so as to boost the economy at large. The situation is even worse when it comes to developing and densely populated countries like India. With a population of around 135.26 Crores approximately.
It becomes even more difficult for policymakers to devise effective policies. The number of fatalities is rising exponentially across the globe. Moreover, the situation in India is no different from the rest of the world.
Funds for COVID-19 Relief
To provide effective relief to the mass population of India and tackle the menace of COVID-19. On 28th of March,2020, the Hon’ble Prime Minister of India Shri Narendra Modi declared the formation of “Prime Minister’s Citizen Assistance and Relief in Emergency Situations” (PM CARES) Fund, to provide relief to the population of India affected by COVID-19.
Since the time this fund was announced, it has been mired in controversies. Owing to the existence of a similar fund called “Prime Minister National Relief Fund” (PMNRF). It was created to deal with similar emergency situations and has an existing corpus of Rs. 3800.44 Crores. Now the primary question which requires consideration is that why do we need to set up PM CARES when PMNRF is already in place for a similar purpose?
Prime Minister National Relief Fund (PMNRF) The PMNRF was established in 1948 to assist displaced people from Pakistan. In pursuance of an appeal by the former Prime Minister Pt. Jawahar Lal Nehru. It was also felt that the said fund may be used to deal with other natural disasters, national medical emergencies, etc.
The PMNRF was originally managed by a committee that included:
- The Prime Minister and his deputy.
- The President of the Indian National Congress.
- The Finance Minister.
- A representative of the Tata Trustees.
- A representative of Industry and Commerce to be chosen by the Federation of Indian Chambers of Commerce.
In 1985, the committee entrusted the entire management of the fund to the Prime Minister. He currently has sole discretion for fund disbursal. A joint secretary in the PMO administers the fund on an honorary basis.
Objectives of PM CARES
Prime Minister’s Citizen Assistance and Relief in Emergency Situations (PM CARES). PM CARES is a similar fund created to help the population of India in fighting with COVID-19. The Prime Minister of India is the ex-officio Chairman of the trust. And, the Home Minister, Defense Minister and Finance Minister, Government of India are ex-officio trustees.
Its primary objectives are:
- To undertake and support relief or assistance of any kind relating to a public health emergency or any other kind of emergency, calamity or distress, either man-made or natural, including the creation or up-gradation of healthcare or pharmaceutical facilities, other necessary infrastructure, funding relevant research or any other type of support.
- Undertake any other activity, which is not inconsistent with the above Objects.
- To render financial assistance, provide grants of payments of money. And, take such other steps as may be deemed necessary by the Board of Trustees to the affected population.
Key similarities in PM CARES and PMNRF
- Both funds have the status of the trust. Under the Income Tax Act and the donations made to these funds are qualified for 100% exemption under Section 80G of the Income Tax Act.
- The auditing of both funds is done by a third party. They are appointed by the members of the trust itself.
- Both trusts are not accountable to the Parliament.
- Prime Minister of India is the ex-officio Chairman of both the trusts.
Key differences in PM CARES and PMNRF
- The minimum donation which can be made to PM CARES is Rs.10, as against Rs. 100 in the case of PMNRF.
- Foreign contributions are also accepted under PM CARES fund and the same are also exempted under Foreign Contribution (Regulation) Act, 2010.
- Companies giving to PM CARES is considered as “Corporate Social Responsibility” or “CSR”. There is no such provision in PMNRF.
Within a week of the formation of PM CARES, it has accumulated more than Rs. 6500 crores, which is three times of the deposits of the last two years of PMNRF. The population of India is very skeptical about the transparency and accountability of the usage of these funds. A resident of Greater Noida and environmental activist, Vikrant Yogadan, had filed an application under the Right to Information (RTI) Act on April 21, 2020, seeking information on 12 points from the PMO.
The PMO hurriedly sent a reply merely six days later, on April 27. He refused to furnish information citing that the application contains multiple requests on numerous and varied topics. To bring in transparency, simple steps can be taken. An example of such a step is making the Leader of Opposition a member of the trust. The audit of PM CARES funds should be conducted by CAG. Moreover, the issue of public declaration and CAG audit of PM CARES Fund has been agitated in a petition. It is filed before the Hon’ble Bombay High Court. The Hon’ble High Court has sought Central Government’s reply to the petition.