PM, MPs, ministers, President take 30% pay cut for a year to boost govt’s Covid-19 efforts

MPLADS fund has been suspended for two years, and the money — amounting to approximately Rs 7,900 cr — will be given to the Consolidated Fund of India.

Prime Minister Narendra Modi interacts with Central ministers via video conference to ensure social distancing (Representational Image) | PIB | Twitter

New Delhi: All MPs, including Prime Minister Narendra Modi and his entire council of ministers, are taking a 30 per cent pay cut for a year, starting 1 April, as the government looks to shore up finances to tackle the Covid-19 crisis.

The decision to approve the ordinance to amend the salary, allowances and pension of Members of Parliament Act, 1954, was taken at the Union cabinet meeting chaired by PM Modi Monday.

According to the changes, 30 per cent will be cut from the basic salary while the pension and allowances of former and serving members of Parliament (MPs) will continue. However, the allowances of serving MPs will be calculated on the reduced basic salary.

Apart from this, the MP Local Area Development Scheme (MPLADS) fund has been suspended for two years (2020-22), and the money will be given to the Consolidated Fund of India.

The cabinet meeting was held via video conference for the first time to ensure social distancing. It was preceded by a meeting of the council of ministers.

Salary break up

The salary of the Prime Minister of India, Union ministers and MPs is over Rs 2 lakh per month. The MPs receive a basic salary of Rs 1 lakh and several allowances, including a constituency allowance of Rs 70,000 and a secretarial cost for office expense of Rs 60,000.

Apart from Modi and the council of ministers, President Ram Nath Kovind, Vice-President M. Venkaiah Naidu and state governors have also volunteered to take a 30 per cent pay cut for a year, Union Information and Broadcasting Minister Prakash Javadekar said in a press briefing.

The President draws a basic salary of Rs 5 lakh per month, the vice-president draws Rs 4 lakh per month, and governors get Rs 3.5 lakh per month.

“The President, vice-president and governors have written letters that they have decided to go for a pay cut of their own volition,” Javadekar said.

MPLADs fund

Each MP is entitled to Rs 5 crore per annum under the MPLADS fund in a year, which he or she can use for the development of their constituency.

There are 543 MPs in Lok Sabha and 245 in Rajya Sabha. Put together, the MPLADS fund for the two suspended years will amount to around Rs 7,900 crore, which is being donated to the government’s Consolidated Fund.

Calling it a “historic” decision, Javadekar said the council of ministers were of the view that they should set an example. “MPs said that charity begins from home and as peoples’ representatives, they should take the lead,” he said at the briefing.

To implement the decision, an ordinance was required. “It’s a law under which we get our salaries. Because the Parliament is not in session, we decided to bring in an ordinance so that the decision can be implemented immediately. We will amend the law once the Parliament commences,” Javadekar added.

Central government employees have also given a day’s salary to the PM CARES fund that was set up by Modi on 28 March to invite donations from citizens as the country tackles the growing number of coronavirus cases. In the time since the nationwide lockdown was implemented to contain the spread of the virus, India’s number of cases jumped by more than 3,000. There are currently over 3,600 active cases and more than 100 deaths.