Daily Current Affairs 25.08.2020 (Fiscal Council, DNA Bill)

Daily Current Affairs 25.08.2020 (Fiscal Council, DNA Bill)

1. DNA Bill can be misused, flags draft report

House committee says provisions could lead to caste or community-based profiling

  • The Bill that proposes DNA sampling and profiling of citizens accused of crime or reported missing and storing their unique genetic information for administrative purposes has some alarming provisions that could be misused for caste or community-based profiling, a draft report of the Parliamentary Standing Committee on Science and Technology has flagged.
  • The committee, headed by Congress leader Jairam Ramesh, met on Monday, but for want of quorum, the draft report, which has been circulated among the members, was not finalised.
  • The DNA Technology (Use and Application) Regulation Bill, 2019, has been in the works for 15 years now. Nearly 60 countries have enacted similar legislation, with the U.S. bringing in a law as far back as in 1994.
  • The committee, in its draft report, pointed out that DNA profiles can reveal extremely sensitive information of an individual such as pedigree, skin colour, behaviour, illness, health status and susceptibility to diseases.
  • “Under the provisions of the Bill, access to such intrusive information can be misused to specifically target individuals and their families with their own genetic data. This is particularly worrying as it could even be used to incorrectly link a particular caste/community to criminal activities,” the report noted.

DNA database

  • The report also red-flagged disregard to an individual’s privacy and other safeguards. The Bill proposes to store DNA profiles of suspects, undertrials, victims and their relatives for future investigations. “While there is a good case for a DNA database of convicts, so that repeat offenders may be easily identified, there is no legal or moral justification for a database with DNA of the other categories as noted above, given the high potential for misuse,” the report noted.
  • In the Bill, if a person is arrested for an offence that carries punishment up to seven years, investigation authorities must take the person’s written consent before taking the DNA sample. But this consent is only “perfunctory”, the report said.
  • “The Bill refers to consent in several provisions, but in each of those, a magistrate can easily override consent, thereby in effect, making consent perfunctory. There is also no guidance in the Bill on the grounds and reasons when the magistrate can override consent, which could become a fatal flaw.”

The DNA Technology (Use and Application) Regulation Bill, 2019

The DNA Technology (Use and Application) Regulation Bill, 2019 was introduced in Lok Sabha by the Minister for Science and Technology, Mr. Harsh Vardhan, on July 8, 2019. The Bill provides for the regulation of use of DNA technology for establishing the identity of certain persons. Note that the same Bill had been previously introduced in Lok Sabha in August 2018, but lapsed.

·  Use of DNA Data: Under the Bill, DNA testing is allowed only in respect of matters listed in the Schedule to the Bill.  These include offences under the Indian Penal Code, 1860, and for civil matters such as paternity suits.  Further, the Schedule includes DNA testing for matters related to establishment of individual identity.    

·  Collection of DNA: While preparing a DNA profile, bodily substances of persons may be collected by the investigating authorities.  Authorities are required to obtain consent for collection in certain situations.  For arrested persons, authorities are required to obtain written consent if the offence carries a punishment of up to seven years.  If the offence carries more than seven years of imprisonment or death, consent is not required.  Further, if the person is a victim, or relative of a missing person, or a minor or disabled person, the authorities are required to obtain the written consent of such victim, or relative, or parent or guardian of the minor or disabled person.  If consent is not given in these cases, the authorities can approach a Magistrate who may order the taking of bodily substances of such persons.   

·  DNA Data Bank: The Bill provides for the establishment of a National DNA Data Bank and Regional DNA Data Banks, for every state, or two or more states.  DNA laboratories are required to share DNA data prepared by them with the National and Regional DNA Data Banks.  Every Data Bank will be required to maintain indices for the following categories of data: (i) a crime scene index, (ii) a suspects’ or undertrials’ index, (iii) an offenders’ index, (iv) a missing persons’ index, and (v) an unknown deceased persons’ index.

·  Removal of DNA profiles: The Bill states that the criteria for entry, retention, or removal of the DNA profile will be specified by regulations.  However, the Bill provides for removal of the DNA profiles of the following persons: (i) of a suspect if a police report is filed or court order given, (ii) of an undertrial if a court order is given, and (iii) on written request, for persons who are not a suspect, offender or undertrial, from the crime scene or missing persons’ index.    

·  DNA Regulatory Board: The Bill provides for the establishment of a DNA Regulatory Board, which will supervise the DNA Data Banks and DNA laboratories.  The Secretary, Department of Biotechnology, will be the ex officio Chairperson of the Board.  The Board will comprise additional members including: (i) experts in the field of biological sciences, and (ii) Director General of the National Investigation Agency and the Director of the Central Bureau of Investigation.

·  Functions of the Board: The functions of the Board include: (i) advising governments on all issues related to establishing DNA laboratories or Data Banks, and (ii) granting accreditation to DNA laboratories.  Further, the Board is required to ensure that all information relating to DNA profiles with the Data Banks, laboratories, and other persons are kept confidential. 

·  DNA laboratories: Any laboratory undertaking DNA testing is required to obtain accreditation from the Board.  The Board may revoke the accreditation for reasons including, failure to: (i) undertake DNA testing, or (ii) comply with the conditions attached to the accreditation.  If the accreditation is revoked, an appeal will lie before the central government or any other authority notified by the central government.  Further, every DNA laboratory is required to follow standards for quality assurance in collection, storing, and analysis of DNA samples.  After depositing the DNA profile for criminal cases, the laboratory is required to return the biological sample to the investigating officer.  In all other cases, the sample must be destroyed.   

·  Offences: The Bill specifies penalties for various offences, including: (i) for disclosure of DNA information, or (ii) using DNA sample without authorization.  For instance, disclosure of DNA information will be punishable with imprisonment of up to three years and fine of up to one lakh rupees.

2. India does need a Fiscal Council

Though it is not a silver bullet, it is an important institution needed to complement the rule-based fiscal policy

  • The fiscal situation in India has been under severe stress even before COVID-19 and the novel coronavirus pandemic has only worsened it. The fiscal deficit of the Centre in 2019-20 as estimated by the Controller General of Accounts (CGA) was 4.6%, 0.8 percentage point higher than the revised estimate. For the current year, even without any additional fiscal stimulus, the deficit is estimated at about 7% of GDP as against 3.5% estimated in the Budget due to a sharp decline in revenues. The consolidated deficit of the Union and States could be as high as 12% of GDP and the overall debt could go up to 85%. When off Budget liabilities are considered, the situation looks even more alarming.
  • While the prevailing exceptional circumstance warrants loosening of purse strings, it is necessary that the government must return to a credible fiscal consolidation path once the crisis gets over.

Need for transparency

  • Besides large deficits and debt, there are questions of comprehensiveness, transparency and accountability in the Budgets. The practice of repeated postponement of targets, timely non-settlement of bill payments and off Budget financing to show lower deficits has been common. The report of the Comptroller and Auditor General (CAG) of India in 2018 on the compliance of the Fiscal Responsibility and Budget Management (FRBM) Act for 2016-17, highlights various obfuscations done to keep the liabilities hidden.
  • These include special banking arrangements for covering arrears of fertilizer subsidy, issuing short-term bonds, unsecured loans and borrowing from the National Small Savings Fund (NSSF) by the Food Corporation of India towards meeting food subsidy and its arrears, financing irrigation projects from the Long Term Irrigation Fund (LTIF) created by the National Bank for Agriculture and Rural Development (NABARD), and financing of railway projects through borrowings from the Indian Railway Finance Corporation (IRFC) are just some examples. We are familiar also with the cases of the Life Insurance of Corporation of India buying out the Industrial Development Bank of India and the Power Finance Corporation buying out the Rural Electrification Corporation (REC) and remitting the money to the government as disinvestment proceeds.
  • In order to make the Budgets comprehensive, transparent and accountable, the 13th Finance Commission recommended that a committee be appointed by the Ministry of Finance which should eventually transform itself into a Fiscal Council to “…, conduct an annual independent public review of FRBM compliance, including a review of the fiscal impact of policy decisions on the FRBM roadmap” (Paragraph 9.65). The FRBM Review Committee too made a similar recommendation underlining the need for an independent review by the Finance Ministry appointing the Council.
  • The problem is that a Council created by the Finance Ministry and reporting to it can hardly be expected to be independent. Therefore, the 14th Finance Commission recommended the establishment of an independent Fiscal Council which should be appointed by and reporting to Parliament by inserting a new section in the FRBM Act. Former Deputy Governor of the Reserve Bank of India, Viral Acharya, in his recent book, Quest for Restoring Financial Stability in India, also makes out a case for a bipartisan, independent Fiscal Council.

The mandate

  • A Fiscal Council is an independent fiscal institution (IFI) with a mandate to promote stable and sustainable public finances. Robert Hagemann (“How Can Fiscal Councils Strengthen Fiscal Performance?”. OECD Journal: Economic Studies, Vol. 1, 2011; p.76) defines a fiscal council as, “…a publicly funded entity staffed by non-elected professionals mandated to provide nonpartisan oversight of fiscal performance and/or advice and guidance — from either a positive or normative perspective — on key aspects of fiscal policy”. These institutions assist in calibrating sustainable fiscal policy by making an objective and scientific analysis.
  • First, an unbiased report to Parliament helps to raise the level of debate and brings in greater transparency and accountability. Second, costing of various policies and programmes can help to promote transparency over the political cycle to discourage populist shifts in fiscal policy and improve accountability. Third, scientific estimates of the cost of programmes and assessment of forecasts could help in raising public awareness about their fiscal implications and make people understand the nature of budgetary constraint. Finally, the Council will work as a conscience keeper in monitoring rule-based policies, and in raising awareness and the level of debate within and outside Parliament.

Diverse role, more acceptance

  • According to the International Monetary Fund (IMF), there were 36 countries with IFIs in 2014 and more have been established since. While most of the IFIs are in advanced countries, emerging economies too have also shown growing interest in them. Although their common agenda has been to function as watchdogs, there is considerable diversity in their structure and functions. The important tasks of these IFIs include: independent analysis, review and monitoring and evaluating of government’s fiscal policies and programmes; developing or reviewing macroeconomic and/or budgetary projections; costing of budget and policy proposals and programmes; and presenting policy makers with alternative policy options. Over the years, monitoring compliance with fiscal rules and costing policies and programmes have become major tasks of these councils.
  • The OECD (2013) has documented the important principles needed for successful fiscal councils under nine broad heads and these are: local ownership; independence and non-partisanship; mandate; resources; relationship with legislature; access to information; transparency; communication and external evaluation. These principles are important, ensure autonomy, being unbiased, transparency, and effective and accountable Councils.
  • How effective have these institutions been? A study by the IMF (“The Functions and Impact of Fiscal Councils”, July 2013), documents that the existence of IFIs is associated with stronger primary balances; countries with IFIs tend to have more accurate macroeconomic and budgetary forecasts; IFIs are likely to raise public awareness and raise the level of public debate on fiscal policy. Case studies in Belgium, Chile and the United Kingdom show that IFIs have significantly contributed to improved fiscal performances.
  • In Belgium, the government is legally required to adopt the macroeconomic forecasts of the Federal Planning Bureau and this has significantly helped to reduce bias in these estimates. In Chile, the existence of two independent bodies on Trend GDP and Reference Copper Price has greatly helped to improve Budget forecasts. In the U.K., the Office for Budget Responsibility has been important in restoring fiscal sustainability. Cross-country evidence shows that fiscal councils exert a strong influence on fiscal performances, particularly when they have formal guarantees of independence.

The final word

  • When the markets fail, governments have to intervene. What do we do when the governments fail? It is here that we need systems and institutions to ensure checks and balances. In that respect, a Fiscal Council is an important institution needed to complement the rule-based fiscal policy. Of course, it is not a ‘silver bullet’; if there is no political will, the institution would be less effective, and if there is political will, there is no need for such an institution.
  • That is also true of the FRBM Act. While we cannot state that the FRBM Act has been an unqualified success, it has also not been an abject failure either. The counterfactual will show that things would have been much worse without it, and it has helped to raise the awareness of government, legislators and the public at large. Similarly, the Fiscal Council will help in improving comprehensiveness, transparency and accountability.
  • M. Govinda Rao was Member, Fourteenth Finance Commission, and former Director, National Institute of Public Finance and Policy, New Delhi, India. The views expressed are personal

What is a fiscal council?

  • Fiscal councils are independent public institutions aimed at strengthening commitments to sustainable public finances through various functions, including public assessments of fiscal plans and performance, and the evaluation or provision of macroeconomic and budgetary forecasts.
  • Fiscal councils are now part of the institutional fiscal apparatus of over 50 countries, including several emerging and developing economies.

Composition and How should they function?

  • The 14th Finance Commission recommended that an independent Fiscal Council should be established through an amendment to the FRBM Act, by inserting a new Section mandating the establishment of an independent Fiscal Council to undertake ex ante assessment of budget proposals and to ensure their consistency with fiscal policy and Rules.
  • The council is supposed to be appointed by, and report to, Parliament and should have its own budget.
  • The functions of the council include ex ante evaluation of the fiscal implications of the budget proposals which includes evaluation of how real the forecasts are and their consistency with the fiscal rules and estimating the cost of various proposals made in the budget.
  • The ex post evaluation and monitoring of the budget was left to the CAG.

Why India needs a fiscal council?

  • Various cesses and surcharges are becoming disproportionate proportion of overall divisible revenue. There should be some mechanism to ensure that the basic spirit of the devolution process should not be undercut by clever financial engineering or taking recourse to traditions.
  • There is a need for coordination between the finance commission as well as the GST Council. GST Council has no clue of what the Finance Commission is doing and Finance Commission has even lesser clue of what the GST Council is doing.
  • Also, for state government liabilities, Article 293 (3) provides a constitutional check over borrowings. But there is no such restriction on the Centre.
  • Therefore, it is time to have an alternative institutional mechanism like Fiscal Council to enforce fiscal rules and keep a check on Centre’s fiscal consolidation.

3. Guwahati gets India’s ‘longest’ river ropeway

People dependent on ferries can now cross river in a jiffy

  • India’s ‘longest’ passenger ropeway across a river was unveiled in Guwahati on Monday, almost a year after it was completed.
  • The 1.82-km bi-cable jig-back ropeway connects a forest campus near the Kamrup (Metro) Deputy Commissioner’s office in the city on the southern bank of the Brahmaputra and a hillock behind the Doul Govinda temple in north Guwahati on the other.
  • The ropeway passes over the mid-river Peacock Island that houses Umananda, a medieval Shiva temple.

Scenic ride

  • “The long wait for a ropeway is over. People dependent on ferry services to travel between the two banks now have an alternative that also offers a view,” Assam’s Finance and Health Minister Himanta Biswa Sarma said after unveiling the ropeway with Guwahati Development Department Minister Siddhartha Bhattacharya.
  • The ₹56.08-crore ropeway project was assigned to the Guwahati Metropolitan Development Authority (GMDA) in 2006. The foundation stone was laid in December 2009, a year after a Kolkata-based firm was awarded the construction work. A Swiss firm designed the cabins later.
  • The ropeway was scheduled to have been commissioned in May 2011 but an objection from the Archaeological Survey of India stopped the work in February that year. GMDA received the permission to restart the project in 2015 on the condition that a pillar on a heritage island be realigned.
  • “We are not sure about the second longest river ropeway, but engineers who worked on the project said the Guwahati-North Guwahati ropeway is India’s longest in its category. The longest on land, of course, is the one in Gulmarg, Kashmir,” GMDA’s chief executive officer Umananda Doley told The Hindu.
  • “We have installed CCTV cameras strategically to ensure security of the ropeway system,” he said, adding that the trial run for the ropeway was done in 2019.
  • Each cabin could carry 32 people, including the operator, and the ride took about nine minutes one way, officials said.
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