Let me answer it from my personal experiences of having worked in IPS. At the outset itself, let me point out that I have almost never paid the informants, rather they have paid me! I’ll explain it later as to how is that possible. I may also point out that in State Police (which basically means regular uniformed police in cities and districts) most of the informants are not the paid informants. They provide information not for money but for other reasons which I shall explain. This is generally the situation in State Police, exceptions apart.
This is unlike Intelligence Bureau (IB) and RAW which have a comprehensive system of grading the informant as well as the information. In IB and RAW, many of their informants may perhaps be paid ones.
There is a system of having a Secret Service Fund (or SS Fund) in uniformed police, which is provided to the chief of the city police or district police, as the case may be. This fund usually has a meagre amount sanctioned every year, though it may vary depending on the requirements of the police unit concerned. This fund is not audited and its use is confidential. Usually, wherever there is a requirement for payment to an informant, money from this fund may be paid. A record is, of course, kept of the money spent from the fund and the officer in charge has to sign it, but it is not audited to maintain secrecy and confidentiality about the informants. The register containing details of the expenditure made from the SS Fund is also supposed to be kept in the personal custody of the officer concerned.
But, let me tell you frankly, even where some payment is required to be made to a (paid) informant, usually the officers in the police station would not claim any money from the SS Fund because they are never sufficient. They would generally pay from their own pockets. But, how can they pay it from their own pocket? Well, you would be shocked to know that during my service I found that the Government would not provide even sufficient stationery (such as, for example, papers for recording statements of witnesses) and money for other necessary expenses such as upkeep of police station buildings, etc. I don’t know what happens now, but this is what used to happen during the time when I was in service, and that too, in one of the supposedly best administered states in India, namely, Maharashtra. As I never liked the idea of the police officers buying stationery, etc., from their own pockets since that would give them a licence to indulge in corruption, I had to often struggle with the system to somehow get sufficient funds to buy at least these basic necessities for the official police working. Usually, police is one of the most neglected departments in Government, even though most politicians would want to (mis)use it.
Coming back to the main topic of informants, as I mentioned earlier, most of the informants provide information to police officers not for seeking money for the information given. They give information for other reasons. Let me give some examples.
When I joined my first regular posting as ASP, after completion of training, on the first day itself, at least 3-4 persons (separately) met me in my office. They had learnt that some young IPS officer has joined and they presumed that a young officer would be dynamic and honest. However, they were generally very cautious and careful, since the office staff would come to know about their identity. They gave me information about illegal satta (a type of gambling, resembling lottery to some extent) and illicit liquor manufacturing. I made it a point to personally raid all those illegal activities on the same or next day. And, I found that all the information given by them was perfect and accurate. It had tremendous impact. There was a drastic reduction in such illegal activities in 1-2 days only, as the news spread about the raids. While earlier such illegal activities were being conducted on large scale and openly, now the scale was much less and that too they started doing it in hidden or secret manner. The best part was that the informants (who gave me the first information) developed trust in me. They became my regular sources.
In fact, over a period of time, I developed so many informants that it became difficult for me to remember their names. After some days, I generally stopped asking their names also. I would concentrate in knowing the information and then act on such information as soon as possible in an effective way. I almost never took police station staff with me for raiding such illegal activities. Many of such raids were conducted by me even single-handedly, though immediately thereafter, I would call the Control Room on wireless to send police station staff for further formalities.
These informants never asked for money for the information given. What they wanted was action on their information.
As the local media (newspapers only, in those days) started picking up these stories of action taken on such illegal activities, you’ll not believe that I was always inundated with information. I would receive several phone calls a day (no mobile phones in those days). I used to receive the call directly due to which leakage of information was not possible. Moreover, caller IDs in phones were not available those days.
The impact was that after some days, even the hidden and secret illegal activities also came to a standstill. As and when any fresh illegal activities would start, I would invariably get the information from some or the other informant.
So, what did these informants want? Action. Strict legal action. On the information given. This was their main motive for giving information. I am writing this from my personal experiences.
Let me tell you about the sorry state of affairs in our country. People are so frustrated that the moment they see even a single ray of light somewhere, they would flood you with information. Some of them would even risk their safety. They would give information to you anonymously, pseudonymously or by disclosing their details. Whatever way possible. They would not seek any money or any other favour from you, generally speaking.
At the same time, I had the bad experiences also. I found that one or two police personnel from my own ASP office were leaking information about my movements (to conduct raids) to the criminals. In those days, since mobile phones were not available and the landline communication was an inefficient luxury (it would take many years to get telephone connection), I found that usually 4-5 scooters were kept parked somewhere at a distance from my office or on roads leading from my office or near the places of illegal activities. The moment they found me leaving office (or residence), one or more of such scooters would immediately rush at high speed to alert those who conducted such illegal activities.
At times, I was personally attacked (thrice brutally) but survived. At times, false information was deliberately given to me in order to entice me to a place and attack me. Unfortunately, the dirty secret is that on 2-3 occasions, it happened in connivance with my own subordinates and/or seniors.
But, that did not deter me. Usually, I would act upon the information without verification. After some time, I also developed judgment as to whom to trust. Merely because, say, 2% informants are false and mischievous, does it mean that I stop trusting 98% of the truthful informants? If you stop acting on genuine information, your sources of information would dry in a short time. So, I always considered it as a professional hazard if I had to take risk while acting on some information.
Surprisingly, on 2-3 occasions, I got information even from the insiders working with criminals about the impending attack on me. That helped me to be on safer side on one or two occasions.
My overall experience about the informants was that a major part of my successes was due to the information provided by them. Without their selfless information, I would not have been even half successful.
And, such information would come not only in respect of illegal activities, but also in respect of regular crimes and also potential law & order problems.
As an individual, one has only two eyes and two ears. But, with a network of informants all over your jurisdiction, you can have a thousand pairs of eyes and ears, spread all over. It helps tremendously.
But, the open secret is that one must act on the information given and act in the strongest possible legal manner. Without fear and favour. If you stop acting on the information (such as when you also become corrupt), your informants will shy away from you over a period of time. They will lose trust in you and will stop giving information to you.
What I have written in the foregoing paragraphs is mostly from my first posting itself. My experiences in my subsequent postings were on similar lines, but generally even better.
In fact, once you have done some good work, your reputation travels faster than you to the place of your next posting. Generally, you get about 8-10 days to join at the new place of posting. But, before you join, all those who are supposed to know about you would have already come to know. This includes not only your future subordinates but also the criminals and those who indulge in organised crime with connivance of police. It makes your work much easier in subsequent postings, provided you keep up your good work and do not give in to corruption and other malpractices.
Now, who would give information to police? Without expecting any money or any favour in return?
They are mostly ordinary citizens who face problems in their day to day lives. They may be victims of illegal activities. They may be sufferers. They may be insiders / workers / rivals of those indulging in illegal activities. They may be members of the same or rival gangs. Sometimes, they may even be police personnel working in a police station who may not be happy with their own seniors indulging in corruption. They may be well-intentioned honest citizens of the locality who want improvement in law & order situation and/or who want to help their nation. They may be media personnel. They can be from some social organisations or from NGOs. They can also be someone trying to come closer to you (but, then you have to be careful while entertaining such people). In fact, an informant can be anybody.
And, occasionally, an informant may be interested to provide information to you for money too. However, this category of informants is generally more common in tax departments (such as in Income Tax department or Customs department) where there is a provision for giving a fixed percentage of the money recovered as revenue as reward to the informants.
As I mentioned at the outset itself, I have not written about IB and RAW since they have their own system of informants. I have written about informants of the regular uniformed police where I have worked. And, I think your question was also with regard to “police”, i.e., the regular “uniformed police”.
So, you have asked – how do police officers pay their informants?
Yes, I paid my informants. But, not in terms of money. But, in terms of strong actionon the information provided by them. Let me tell you – they were all satisfied.
As I mentioned in the beginning – it is the informants who have paid me! How? By their profuse thanks. By their gratitude. By tears of satisfaction sometimes seen in their eyes. By giving me more and more information that enabled me to perform my duties in a better way. And much more. Let me tell you that the thanks expressed by a needy fellow citizen can give you the kind of satisfaction that money can never give you. Try it yourself if you don’t trust me.
There is no dearth of good people in our country. The problem is more from the politicians and the bureaucrats / public servants. An ordinary citizen is generally honest and willing to improve the system. Informants also fall in this latter category.
This is explained beautifully by Ashok Dhamija, Former IPS on Quora.