PM CARES – Mahua Attacks & Nirmala Shields

On March 28, 2020, the Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES Fund) was created. Ever since that day, there have been numerous allegations from the opposition parties questioning the need for PM CARES when PM NRF (Prime Minister’s National Relief Fund) already exists. Recently, the Lok Sabha speeches of TMC MP Mahua Moitra and Finance Minister Nirmala Sitharaman, arguing for the opposition and the government respectively, caught the attention of the nation. Some excerpts adapted from both their speeches are mentioned below.

Mahua Moitra:

The TMC MP questioned the government’s logic of allowing contributions to the PM CARES Fund as eligible CSR expenditure, while disqualifying contributions made to the ‘state relief funds’ from being treated as valid CSR activities. She claimed that such unequal treatment of central and state relief funds violated Article 14 of the constitution.

More than 2100 crore rupees were donated to the PM CARES fund by 38 Public Sector Undertakings (PSUs), including Coal India, ONGC, HPCL, among others. While this amounted to around 70 percent of the total corpus, she claimed that the PSUs were acting like “the courtiers of the emperor competing with one another to give him gifts with public funds”.

Not submitting to audit by the Comptroller and Auditor General (CAG) makes the fund and its usage very opaque. By refusing to answer RTI queries stating that the fund is not a public authority, she accused the government of running away from transparency and diverting “those funds away from local communities into a dark hole where not even a speck of light can enter.”

She asked why the government accepted massive donations from Chinese companies, including Xiaomi, Huawei and TikTok. She asserted that “no dying Indian would choose to be on a ventilator paid for by Chinese money.”

Nirmala Sitharaman:

The Finance Minister stated that while the PM CARES Fund was registered, the Congress-created PM NRF was not yet registered. She questioned why the Congress governments did not bother to get the PM NRF registered during their several years of rule.

She claimed that the Congress party asked the government to not spend funds from PM NRF when floods ravaged different states of our country, as they were worried about the availability of those funds for building the Jawaharlal Nehru museum.

While PM CARES Fund is managed by a board consisting of the Prime Minister, Ministers of Home Affairs, Finance and Defence, the management committee of PM NRF included the Congress Party President. She said that the Congress government could have included other parties and leaders like the Jan Sangh’s Shyama Prasad Mukherjee or socialist leader Ram Manohar Lohia in the management committee, but they did not do so.

Audits for both PM CARES Fund and PM NRF are being done by the same firm, SARC and Associates. RTI is not applicable for both the funds. Donations are eligible for deductions under Section 80 (G) of Income Tax Act, for both the funds. Donations by companies classified as CSR for the purposes of Companies Act, 2013 are applicable to both the funds.

P.S. Business Standard has an interesting take on why PM CARES is more democratic than PM National Relief Fund. You can read it here.