Curbing Freebies Culture

• 20 Feb 2026

For Prelims: Supreme Court, Political Parties, Directive Principles of State Policy (DPSP), Model Code of Conduct, Representation of the People Act, 1951,  Economic Survey 2025–26, Fiscal Deficit, Mid-Day Meal Scheme,  Pradhan Mantri Kisan Samman Nidhi (PM-KISAN), National Food Security Program, Public Distribution System (PDS), Fiscal Responsibility and Budget Management (FRBM) Act, 2003, Off-budget Borrowings

For Mains:  Freebies and concerns associated with freebies in India, freebies vs welfare debate, steps are needed to curb freebies.

Source: IE

Why in News?

The Supreme Court (SC) has expressed deep concern over the growing trend of political parties and state governments announcing freebies and direct cash transfers to woo voters.

SC questioned whether such populist measures amount to "appeasement" and warned they are hindering national development, reigniting the debate between freebies and genuine welfare.

Summary

• Freebies offer short-term relief but risk fiscal unsustainability and dependency.
• Welfare policies, rooted in DPSP, target long-term human development through planned expenditure.
• Solutions include conditional transfers, FRBM strengthening, voter awareness, and distinguishing merit goods from populist freebies.

What are Freebies?

• About: Freebies refer to public welfare measures or benefits provided free of charge by governments or promised by political parties, typically to attract voter support during elections.
• Key Characteristics: Freebies are populist and distortionary, designed to win votes by diverting funds from crucial long-term investments. 
  
  • They are also unsustainable and unproductive, creating a burden on state finances and fostering a culture of dependency rather than self-reliance.
• Common Examples: 
  • Utility Subsidies: Free electricity (up to certain units) for farmers or households, free water connections.
  • Consumer Goods: Free distribution of laptops, TVs, mixer-grinders, etc.
  • Food and Essentials: Free food grains beyond PDS, monthly free ration kits
  • Loan Waivers: Waiving farmer or other community loans.
  • Cash Transfers: Direct cash doles to specific groups like unemployed youth or women.
• Legal and Institutional Landscape:
  
  • Supreme Court: In the S. Subramaniam Balaji Case, 2013, the SC ruled that freebies fall within legislative policy and are beyond judicial scrutiny. It emphasized that certain freebies align with the Directive Principles of State Policy (DPSP). 
  • In 2022, the SC decided to set up an expert group with representation from NITI Aayog, Finance Commission, Election Commission, RBI, and political parties to study the impact of freebies and recommend regulatory measures, but it was ultimately not formed.
    • While hearing a PIL in 2025, the SC condemned pre-election freebies, warning free ration and money discourage work and create a "class of parasites".
  • Election Commission of India: Under its Model Code of Conduct and manifesto guidelines, it states that while manifestos cannot be treated as corrupt practices under the Representation of the People Act, 1951, parties should avoid commitments likely to vitiate the purity of elections or exert undue influence.
  • Reserve Bank of India: RBI defines freebies as welfare measures distinct from merit goods like education, warning that competitive announcements of loan waivers, free electricity, and cash transfers crowd out infrastructure spending and strain state budgets.

What Concerns are Associated with Freebies in India?

• Rising Debt Burden: According to the Economic Survey 2025–26, unconditional cash transfers and populist freebie schemes implemented across Indian States are estimated to cost approximately Rs 1.7 lakh crore in FY26. Combined gross fiscal deficit of states rose from 2.6% of GDP in FY22 to 3.2% in FY25, with outstanding liabilities at about 28.1% of GDP.
• Crowding Out of Productive Capital: Freebie spending crowds out critical infrastructure by sacrificing capital expenditure—which offers stronger, more durable growth—whenever fiscal pressures mount. This diversion from long-term investments ultimately undermines medium-term economic growth and development priorities.
• Electoral and Democratic Concerns: Promise of irrational freebies from public funds before elections unduly influences voters, and disturbs the level playing field. Such practices amount to an unethical practice similar to giving bribes to the electorate.
• Creation of Dependency Culture: For beneficiaries, cash transfers form 11–24% of monthly income for female casual labourers and up to 87% for some self-employed women, raising concerns about long-term dependency. It discourages self-reliance and entrepreneurship vital for sustainable economic growth.
  • E.g., Venezuela's provision of free food, transport, and services fostered a non-productive population, ultimately contributing to the country's economic collapse around 2000.
• Limited Impact on Developmental Outcomes: While freebies improve consumption and short-term income stability, they do not consistently improve child nutrition, education outcomes, or enable sustained exits from poverty. Such outcomes depend on complementary public services and jobs, not cash transfers alone.

Benefits of Freebies

• Foundation for Welfare Schemes: The Mid-Day Meal Scheme, first introduced in 1956 by Tamil Nadu, was adopted nationally later. NT Rama Rao's Rs 2/kg rice scheme in Andhra Pradesh laid the foundation for today's National Food Security Program.
  • Telangana's Rythu Bandhu and Odisha's KALIA schemes served as precursors to the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) for farmer support.
• Educational Access: A NITI Aayog report stated that distribution of bicycles to schoolgirls in Bihar and West Bengal has significantly reduced dropout rates, enhanced attendance and improved learning outcomes.
• Women Empowerment: Freebies like bus passes for women can encourage women to join the workforce, leading to economically stable families and women empowerment. States like Tamil Nadu and Bihar provide women with sewing machines that enhance livelihood opportunities.
• Food Security: Food security schemes like the Public Distribution System (PDS) and Mid-Day Meal ensure basic sustenance, preventing extreme poverty.
• Economic Stimulus: Cash transfer generates demand-side stimulus that benefits small businesses and local manufacturers.
• Democratic Participation: Freebies can foster political awareness and public trust by demonstrating government accountability and responsiveness to citizens' needs.

What is the Freebies Vs Welfare Debate?

Aspect	Freebies	Welfare Policies / Schemes Welfare
Definition	Public welfare measures provided free of charge, often short-term and populist in nature.	Structured, rights-based or developmental interventions aimed at long-term socio-economic upliftment, human capital formation, and equity (aligned with Directive Principles of State Policy).
Primary Objective	Immediate voter appeal, electoral gains, or short-term relief/populist appeasement.	Sustainable improvement in living standards, poverty reduction, skill development, and social justice.
Time Horizon	Short-term; often announced or expanded near elections with limited sustainability planning.	Long-term; designed for enduring impact and institutional continuity.
Targeting	Frequently universal (e.g., free electricity/water for all consumers, regardless of income).	Targeted toward vulnerable/marginalized groups (e.g., poor, women, children, rural unemployed) to avoid wasteful universal coverage.
Fiscal Sustainability	Often strains state budgets, crowds out capital expenditure, and contributes to revenue deficits or contingent liabilities.	Prioritizes fiscal prudence; focuses on merit goods with high multiplier effects on growth and development.
Economic Impact	May create dependency, distort markets, erode credit discipline (e.g., loan waivers), and divert resources from infrastructure/education/healthcare.	Promotes human development, reduces inequality, enhances productivity, and supports inclusive growth.
Examples	Free laptops, smartphones, televisions, bicycles, universal free electricity, direct cash transfers without strict need-based criteria, farm loan waivers.	Public Distribution System (PDS), Mid-Day Meal Scheme, targeted healthcare/education programs, nutrition schemes.

What Steps are Needed to Curb Freebies?

• Differentiate between Freebies and Welfare: Establish policy guidelines differentiating essential welfare from electoral freebies using objective criteria such as social utility, long-term human development impact, fiscal sustainability, targeting effectiveness, and outcome orientation. This framework should classify merit goods separately from non-merit consumption subsidies.
• Budgetary Discipline: Strengthen the Fiscal Responsibility and Budget Management (FRBM) Act, 2003 to prevent reckless fiscal spending by states. Mandate that all subsidy schemes include sunset clauses and periodic review mechanisms.
  • Improve tracking of off-budget borrowings and hidden subsidies (e.g., underpricing of electricity) through strengthened financial regulators.
• Enhancing Voter Awareness: Foster informed public discourse on the opportunity cost of freebies—what is foregone (schools, hospitals, roads) when resources are diverted to consumption subsidies. Encourage civil society organizations and media to scrutinize electoral promises and their fiscal implications. 
• Learning from International Best Practices: Cash support can be designed as conditional, review-based, and time-bound, reducing long-term fiscal rigidity while strengthening human capital outcomes. 
  • E.g., Mexico's Progresa and Brazil's Bolsa Familia link cash transfers to verifiable actions such as school attendance and health check-ups.
• Strengthening Legal Framework: Explore amendments to the Representation of the People Act, 1951 to address undue influence through freebie promises. Strengthen the legal framework requiring parties to disclose funding sources and fiscal viability of manifesto promises.

Conclusion

The freebies versus welfare debate represents India's core governance challenge i.e.,  balancing electoral democracy with fiscal prudence. While freebies offer short-term relief, they risk undermining long-term development. The path forward lies in designing conditional, targeted, and time-bound welfare schemes that build human capabilities rather than dependency, ensuring sustainable and inclusive prosperity.

Drishti Mains Question:

Q. "Freebies are often criticized as populist electoral tools, yet some have evolved into transformative welfare schemes." Examine.

Frequently Asked Questions (FAQs)

1. What are freebies in Indian politics?

Freebies are public welfare benefits provided free of cost, often election-timed, and distinct from merit goods like education and healthcare.

2. How are welfare schemes different from freebies?

Welfare schemes are targeted, rights-based, and growth-oriented, whereas freebies are often universal, short-term, and electorally motivated.

3. What reforms are suggested to curb freebies?

Strengthening the FRBM framework, improving transparency, conditional transfers, sunset clauses, and enhancing ECI oversight are key reforms.