ONOE represents a disruptive move when federalism is under stress

The NDA government on September 18 justified its decision on starting the transition to ONOE by citing the recommendations of the Kovind Committee.

Bringing about legal changes to hold simultaneous elections across all levels of government, or ‘One Nation, One Election’ (ONOE), and creating a common centralised electoral roll were promises made in the BJP manifesto ahead of the 2024 Lok Sabha election. In keeping with the same, the union cabinet on September 18 decided to go ahead with the preparatory work for it.

The foundation for a transition to ONOE was laid before the Lok Sabha election when a nine-member committee led by former president Ram Nath Kovind presented a report in March 2024 recommending it. The report laid out its reasons and also said that legal changes synchronising Lok Sabha and state assembly elections do not require the union government to get concurrence of state assemblies. Synchronising local body elections, however, will need the concurrence at the level of state assemblies.

We have been there before

Between 1951 and 1967, India witnessed ONOE. Subsequently, when the electorate didn’t always give a decisive mandate, some governments didn’t last their full course and elections became asynchronous. This happened in the natural course of India’s democratic evolution.

Therefore, the current drive to ONOE is to reset democracy by terminating the life of most state assemblies before they finish their natural course (this needs to happen once). Not all political parties were in favour of this disruptive step. The Kovind Committee report said 15 of the 47 political parties, or 32 percent, it consulted did not favour ONOE.

A disruption of this scale where the entire cost of transitioning to ONOE has to be borne by states needs a powerful reason.

Arguments in favour

The strongest arguments in favour of ONOE in the Kovind Committee report are the benefits to the administrative system which provides the manpower for the election machinery. These benefits includes less disruption for staff and some level of cost compression.

The weak link

The most unconvincing aspect of the Kovind Committee report is the attempt to link economic growth outcomes to simultaneous elections. The report sidesteps the most important aspect of India’s economic track record. The economic growth spurt of the last 44 years came when we had asynchronous elections.

The report appears to incorrectly conflate policy stability with elections. They are often unrelated. To illustrate, in the 1990s, India had five prime ministers, but economic policy across governments displayed a level of consistency that produced significant benefits later.

Federal argument

As a transition to ONOE has clear downsides for states, there has to be a more comprehensive assessment of costs and benefits than what the Kovind Committee attempted.  The Committee was necessarily limited in its assessment because it had a narrow remit.

The high point of Indian federalism was the transition to GST in 2017, which represented the efforts of four union governments and a willingness on the part of states to voluntarily forego unilateral taxation powers for a larger cause.

Since then, federalism has been under stress. One area where it’s clearly evident is in the presentations opposition-administered states have been making to the 16th Finance Commission.

The Commission is in the midst of information gathering prior to preparing its report. Its report will be tabled at a time when some states feel they have been getting a raw deal in the allocation of resources.

To illustrate, in a presentation to the Finance Commission in August, the Karnataka government asked for all cess and surcharge levied by the union government to be capped at 5 percent of the gross tax revenue (GTR).

The background to this demand is that cess and surcharge are excluded from the divisible pool of tax resources shared among centre and states. Opposition-administered are vocal in their displeasure with a growing level of cess and surcharge that make up GTR as it reduces the fiscal space they get to fulfil promises made in their state election manifesto.

The case against ONOE

ONOE represent a disruption rather than a revolution. The NDA government on September 18 justified its decision on starting the transition to ONOE by citing the recommendations of the Kovind Committee.

To justify this level of disruption, we need benefits that are far greater than what the Kovind Committee detailed. The Committee, limited by its remit, ignores the current political environment in India and the stress that Centre-State relations are under.

The scale of political costs of transition will depend heavily on the harmony between the union government and opposition-administered states. The one thing that is absolutely clear is that we have long left the goodwill that was needed to roll out GST behind us. There’s bitterness in the relationship.

That makes the case for a transition to ONOE weak as we are underestimating the political costs. It’s best to drop this idea now. Instead, a reset of Centre-State relations should be the priority.