1.Freebies versus Welfare Debate (Electoral Freebies)
What & Where
Freebies = RBI term for public‐welfare goods/services given free of charge, often before polls
Delhi Assembly 2025 highlights surge in cash, gadgets, free ration promises to woo voters
Typical non-merit items: TVs, laptops, mixer-grinders; contrast with merit goods like education, health
Quick Facts for MCQs
Socio-economic Gains
- Women empowerment via direct cash improves bargaining power, reduces dependence
- Capability approach: free food, health cover raise dignity, productivity, long-term human capital
- Cash transfers spur local demand, circulating money in low-income markets
Fiscal Risks
- Revenue deficit rise crowds out capital spends on infra, health, education
- Higher borrowing escalates debt servicing, elevates credit-default probability for states
- Possible tax hikes shrink middle-class disposable income, dampen consumption
Judicial & Constitutional
- DPSP alignment lets welfare spending escape strict judicial review, yet court flags pre-poll inducement concern
- No current constitutional bar on promising non-merit freebies during campaigns
Reform Path
- Strengthen FRBM; enforce time-bound, targeted subsidies linked to outcomes
- Draft objective yardsticks separating welfare from electoral giveaways: social utility, long-term impact, fiscal sustainability
- Enhance regulatory tracking of off-budget borrowings, electricity under-pricing, hidden subsidies
Key Data Points
| Feature | Data-Point |
|---|---|
| SC precedent | S. Subramaniam Balaji vs TN 2013: freebies within legislative policy |
| Recent SC remark | 2025 PIL: warned of creating “class of parasites” via free ration, money |
| Delhi revenue surplus | Fell 35 % between 2022-23 & 2024-25 due to freebies |
| Extra subsidy load | RBI: Rs 10,000-12,000 cr annually from new giveaways |
| Merit good example | Mid-Day Meal under PDS ensures food security |
| Key fiscal guardrail | FRBM Act 2003 limits deficits, seeks prudence |








