Incentives for Better Protection of Whistle-Blowers – An Economic Analysis

Anushka Mittal in this article explains the importance of whistle-blowers in India and suggests many measures to protect them from economic analysis.

Abstract

Whistle-blower protection is necessary across all sectors; public and private. In India, whistle-blowing in public sector is governed statutorily by the Whistle-blower Protection Act, 2011. It provides the procedure to file a complaint, conduct enquiry and provide protection to whistle-blowers. There have been many instances of whistle-blower deaths. The deaths caused by an activity such as whistle-blowing indicate the deep rooted malaise in the entire system of governance of a nation. The process to seek protection against threats is long drawn and time-consuming enough to cause detriment in the intervening period. Against this status quo, this article recommends a better mechanism to provide protection to the whistle-blowers. The recommendation aims to provide mandatory interim protection to an applicant. The recommendation tries to resolve the classic dilemma between a rule and a standard. The provision for whistle-blower protection, as it stands, is an ex-post standard whereby the enforcement and information cost is high. The recommendation proposes an ex-post rule regime whereby the promulgation cost, though high, would be justified due to the clarity and vital protection that it provides to the stakeholders. The recommendation is based on the use of economic analysis which signifies a new approach to deal with an old issue.