Two amendments out of seven proposed by DoPT receive an okay from Information Commissioners
Information commissioners (ICs) across the country have said that that no amendments were necessary to the Right to Information (RTI) Act.
In a bid to strengthen the RTI Act, the Department of Personnel and Training (DoPT) had called a meeting for consultation with around 60 central and state ICs across the country on 14 October 2009. However, the ICs received the minutes of the meeting only after three months.
During the meeting, all ICs pointed out that the decision of what constitutes ‘vexatious’ or ‘frivolous’ would have to be left to the personal information officers (PIOs). This would result in large-scale rejections by PIOs and would go against the present principle that no purpose needs to be given by applicants.
The DoPT outlined seven amendments. The ICs almost unanimously pointed out that the first five points needed no amendments.
Here are the seven proposals, out of which five needed no amendments and two which would dilute the RTI Act and would need an amendment to the Act:
1) Constitution of benches: DoPT held that the present constitution of benches, where cases are heard by a single Information Commissioner is not legal. The Commissioners pointed out that this was not the correct position, and the Central Information Commission had already ruled on this matter. Even if the DoPT’s argument was accepted, only a change of rules would be required. DoPT was proposing that all benches should be two-member benches, which would increase the expenditure per case by nearly 100%, and most Commissions would be overwhelmed by the cases, since they would not be able to cope with the same.
2) Removal of nine exempted public authorities from the list in Schedule (2): There is no need for an amendment, as a few public authorities have already been included and deleted through a notification as per Section 24(2) of the RTI Act.
3) Include Citizens Charter in Section 4 declarations of each public authority: Here again, there is no need to amend, as it can be included under Sec 4(1)(b)(xvii), which says, ‘Such other information as may be prescribed’.
4) Defining what is meant by ‘substantially financed’ under 2(h)(d)(ii): This is already being judicially defined by Information Commissioners.
5) Facilitate Indians abroad to use RTI Act through embassies: This can be done very easily by making appropriate rules.
The two proposals which needed an amendment to the Act proposed by DoPT are as under:
6) Adding ‘frivolous & vexatious requests’ to the list of Section 8 exemptions: Commissioners pointed out that the decision of what constitutes ‘vexatious’ or ‘frivolous’ would have to be left to the PIOs.
This would result in large-scale rejections by PIOs and would go against the present principle that no purpose needs to be given by applicants. Most Commissioners spoke against such an amendment, while two stated that it was necessary.
7) Excluding discussions/consultations that take place before arriving at governmental decisions; in other words, exclusion of file-notings, which would render the working of the government completely opaque to citizens. This would mean that citizens will know the reasons for taking decisions only after the decisions have been taken and never know why certain decisions in their benefit were not taken.
All the ICs gave their verdict that for the first five objectives there was no need to amend the RTI Act. On point (6) two Commissioners spoke in favour of amending the Act to prevent frivolous and vexatious RTI queries, whereas over half a dozen opposed these. On point (7) also the Commissioners expressed a clear view that no amendment was desirable. Some Commissioners pointed out that any change in the RTI Act would lead to unnecessary confusion in implementation and in the minds of citizens and PIOs.
Less popular, low-cost insurance products are compensating the distributors’ fall in income from selling equity funds
Low-cost life insurance products are making a comeback, occupying the space once reserved for equity mutual funds. With the sales of equity mutual funds almost grinding to a halt thanks to abolition of entry load from August 2009, low-cost life insurance products that look like equity mutual funds have got a new lease of life.
“Life insurance companies always had products that were of lower cost. But distributors were not keen to sell them because they made much more money selling other insurance products. But with distributors now unwilling to sell equity mutual funds, insurance companies have sensed an opportunity to sell low-cost insurance products too,” says a chief executive officer (CEO) of an insurance company.
Accordingly, these products are being dusted down and pushed into the market. Plans like HDFC’s pension plan which is a single premium plan, are making a comeback. Other products in this category are LIC’s Market Plus unit-linked single premium policy and ICICI Prudential’s Life Time Super Policy. For instance, LIC’s pension plan deducts 3% (Rs990) as allocation charges for a premium of Rs30,000 which comes with options of life cover, accident benefit and critical illness benefit.
In fact, one of the largest and high-profile insurance companies is set to launch a product soon that will mean a commission of just 2% for its distributors.
The mutual fund distributors are also put off by the cumbersome and frequent changes in regulations. They want to ditch mutual funds completely. Many of them wanted insurance companies to protect their revenues they used to derive from selling mutual funds. To fill this gap in income, insurance companies have decided to highlight the low-cost funds in their portfolio.
Earlier, distributors were reluctant to sell these because they used to make much more money on selling regular insurance products. “If I have to sell an insurance product, I might as well sell one with the highest premium,” said a distributor.
“Why would I sell a product that yielded such low commission?” he asked.
Meanwhile, in the correction of the last two weeks, some money has come back into equity funds. “But this is not retail investors’ money. It is smart money that usually comes in when the market is down sharply. It also goes out quickly, once there is a rebound,” says a CEO of an asset management company.