The Congress party is facing its worst-ever financial crisis since Independence. “Within eight months, we will be in debt,” said a senior party leader, requesting anonymity.

The funds crunch has affected the party’s ability to campaign during elections. For instance, a rally by Sonia Gandhi, planned towards the end of December as a build-up to the Delhi elections, had to be cancelled.

“The estimated cost of such a rally is ₹1 crore. But, we could not even think of it. We were way behind the BJP and the AAP in outside advertisements, too, due to this funds crunch,” said a Delhi Pradesh Congress Committee leader.

The AICC also could not provide any major financial assistance to its candidates in the five Assembly elections after the 2014 Lok Sabha polls.

According to several key functionaries in the party that BusinessLine spoke to, the All India Congress Committee (AICC) is currently functioning with an overdraft from various banks. The party high command fears that unless it changes its fund mobilisation method, it will be difficult to sustain itself.

Motilal Vora, Treasurer of the Congress Party, however, downplayed the crisis and said: “What is wrong if we function on an overdraft”.

Party President Sonia Gandhi and Vice-President Rahul Gandhi are reported to be in favour of forming a sub-committee to look into the party’s financial situation and addressing the matter urgently.

For the Delhi elections, party leaders said that Congress candidates had to work like independent candidates with the party symbol as both the Delhi Pradesh Congress Committee and the AICC could not provide funds.

Party insiders attribute the crisis to the financing pattern followed by the party for more than four decades, which has been in place since Indira Gandhi’s time.

“We had fund managers in various States who were closely linked with big business houses. Whenever the party wanted funds, they used to provide us with the money,” a leader said. These fund managers were changed according to power equations in States and at the Centre.

“Now, since the defeat in the Lok Sabha elections, we are not getting funds from corporate houses. Second, some of the fund managers feel they are not being treated properly by the party leadership and refused to help the party during the Assembly elections,” he added.

The feeling in the top brass of the Congress is that the system of fund managers will have to be scrapped.

“The individual preferences of leaders handling funds is not doing any good for the party in this hour of crisis. What we are trying to do is democratise funds collection,” said another leader.

Rahul Gandhi, apparently, favours the Kerala model, under which funds are mobilised from the public.

“In Kerala, the KPCC goes directly to people — not to individual business houses — to collect funds. This system of mass collection has to be adopted at the Centre, too. It will take time to change the present form as it is deeply entrenched. But change has to happen,” the leader added.