On 28th March, the Government of India announced the creation of a Trust Fund called the Prime Minister’s Citizen Assistance and Relief in Emergency Situations (PM CARES) fund.
There is no official information available about how much money has been accumulated in this fund. According to unofficial estimates, about Rs. 9700 crores had been collected until 19th May. Of this, Rs 4,300 crore had been donated by government agencies and staff. The remaining Rs 5400 crore had been donated mainly by private companies.
Private companies have been allowed to treat donations to PM CARES as part of their mandatory spending on Corporate Social Responsibility (CSR).
Reliance Industries is reported to have donated Rs. 500 crore to PM CARES, while announcing a cut in the salaries of its employees. The Tata group has pledged to donate Rs. 500 crore. Larsen and Toubro contributed Rs. 150 crore, even as hundreds of its workers protested against non-payment of their wages.
Thousands of government employees, at all levels, have donated to PM CARES. In many cases they have been compelled to do so because the concerned government department pledged one day of their salaries to the fund.
Doctors at government hospitals were asked to donate money but many of them refused in protest, pointing out that they had not been provided essential items such as personal protective equipment.
The PM CARES fund has been set up as a trust for the purpose of “dealing with any kind of emergency or distress situation, like that posed by the COVID-19 pandemic”. A similar trust fund already exists, called the Prime Minister’s National Relief Fund (PMNRF). As of December 2019, the PMNRF had an unspent balance of Rs. 3,800 crore.
The Government of India has not explained why another fund was set up, when PMNRF already exists. Both funds offer tax benefits to capitalist companies which donate their CSR funds mandated by law (as 2% of a company’s profits). Both are permitted to receive foreign funding. However, there is one key difference. While PMNRF discloses the amount of donations received and spent, there seems to be no such requirement for PM CARES to make its accounts public.
On 13th May, the Prime Minister’s Office announced that Rs. 3100 crore has been allocated from this fund for expenditure in dealing with the Corona virus. No details were provided regarding what exactly the money was spent on. This is so far the only announcement regarding the use of PM CARES fund.
The Prime Minister’s Office has rejected a Right to Information application, seeking details of the PM CARES fund, stating that it is “not a public authority”!
The PM Cares Fund has benefited the biggest Indian capitalist companies in two ways. Firstly, they have saved the administrative costs associated with having to spend 2% of their profits for CSR. Secondly, they have derived tax benefits from these contributions.
At a time when there are serious shortages of personal protective equipment and medical supplies in hospitals and many state governments are begging for additional funds, the lack of information about what the PM CARES fund is being used for raises the question: Who does the PM really care about?