The political pay cut | India Today Insight
How much will the pay cuts help the fight against COVID-19?
On April 6, Union Minister Prakash Javadekar announced a 30 per cent salary cut for all members of Parliament, including Prime Minister Narendra Modi and his council of ministers. The unprecedented measure was taken as a sign of solidarity in the country’s fight against the novel coronavirus pandemic. Talking to media persons, Javadekar revealed a Union Cabinet decision to promulgate an ordinance amending the Salary, Allowances and Pension of Members of Parliament Act, 1954. The deductions will come into effect from April 1 and will continue for a year.
President Ram Nath Kovind, Vice-president Venkaiah Naidu and all state governors have also voluntarily decided to take a pay cut for a year. The Cabinet also approved the move to temporarily suspend the Members of Parliament Local Area Development Scheme (MPLADS) fund till 2022. The money saved through these efforts will go into the Consolidated Fund of India. The funds will be used to manage health services and the COVID-19 fallout in the country, Javadekar added.
So how much will the government actually save by cutting the salary of the top Constitutional authorities and elected representatives? Well, just a little over Rs 52 crore. The suspension of MPLADS for two years will earn the government another Rs 7,900 crore. The MPLADS fund was first launched during the Narasimha Rao Government in 1993, aimed towards providing funds for development work recommended by individual MPs. The MPs are entitled to recommend works to the tune of Rs 5 crore annually. The objective of the scheme is "to enable MPs to recommend works of developmental nature with emphasis on the creation of durable community assets based on the locally felt needs to be taken up in their constituencies".
The guidelines lay down a number of development works, including construction of roads, railway halt stations, financial assistance to recognised educational bodies, cooperative societies, installing CCTV cameras and providing sanitation, drinking water rainwater harvesting systems. The MPLADS funds can be provided for other schemes such as MNREGA and Khelo India too.
Opposition parties too welcomed the salary cut, but have slammed the Prime Minister Narendra Modi-led Union government for the suspension of MPALDS funds on the ground that it is actually not a saving, but the diversion of a development fund to a contingency fund. "If this money is finished, it will have a direct negative impact on the people in the MP's constituency. The people of the country are losing out here. If the country's MPs lose their voice, then how will Parliament function effectively?" asks Congress communication in-charge Randeep Singh Surjewala. CPI (M) leader Sitaram Yechury claims there is enough evidence to show that COVID-19 is best fought at the state and local level. The government, however, finds support in this piece of statistics: of the Rs 11,525 crore released during the 16th Lok Sabha, Rs 1,641.98 crore remains unutilised. A cumulative amount of Rs 5,275.24 crore remained unspent under MPLADS as of March 4, 2020.
For a moment, let’s forget the MPLADS funds and see how the government, with its Rs 52 crore saved through salary cuts, can make a difference in the fight against COVID-19?
Here are a few things it can do. There are three most significant items that are needed in substantial quantity right now--test kits, personal protection equipment (PPE) and ventilators. The average cost of a single test kit is Rs 1,500. So the Rs 52 crore can help the government buy nearly 350,000 test kits.
The average cost of a PPE kit ranges from Rs 650 to Rs 2,500 (highly inflated priced because of the crisis). If we assume the average price to be Rs 1,000, the government can buy more than 500,000 PPE kits.
The average cost of a fully equipped ventilator is Rs 12,50,000. At that price, the salary deductions will help the government buy 418 ventilators.
The Union government estimates the country will see a spike in demand for personal protective equipment (PPE) and diagnostic kits to the tune of 15 million PPEs, 1.6 million diagnostic kits and 50,000 ventilators by June. That will cost the government around Rs 8,000 crore. And the funds diverted from MPLADS amount to Rs 7,900 crore.
How much will India save?
President
|
Amount |
|
|
Total salary |
Rs 5,00,000 per month |
|
Total amount deducted in a year |
Rs 18,00,000 |
Vice-president
|
Amount |
|
|
Total salary |
Rs 4,00,000 per month |
|
Total amount deducted in a year |
Rs 14,40,000 |
Governors
|
Amount |
|
|
Total salary |
Rs 3.5 lakh per month |
|
Total amount deducted in a year |
Rs 3,52,80,000 |
Prime Minister
|
Basic salary |
Rs 50,000 |
|
Constituency allowance |
Rs 45,000 |
|
Sumptuary allowance |
Rs 3,000 |
|
Office expense allowance |
Rs 45,000 (Rs 30,000 to office assistant) |
|
Total |
Rs 1,43,000 |
|
Total amount deducted in a year |
Rs 5,14,800 |
Union Ministers
|
Basic salary |
Rs 50,000 |
|
Constituency allowance |
Rs 45,000 |
|
Sumptuary allowance |
Rs 2,000 |
|
Office expense allowance |
Rs 45,000 (Rs 30,000 to office assistant) |
|
Total |
Rs 1,42,000 |
|
Total amount deducted in a year |
1,43,13,600 |
Rajya Sabha members
|
Basic salary |
Rs 1,00,000 |
|
Constituency allowance |
Rs 70,000 |
|
Office expense allowance |
Rs 60,000 (Rs 40,000 to office assistant) |
|
Total |
Rs 2,30,000 |
|
Total amount deducted in a year |
Rs 19,70,64,000 |
Lok Sabha members
|
Basic salary |
Rs 50,000 |
|
Constituency allowance |
Rs 45,000 |
|
Office expense allowance |
Rs 45,000 (Rs 30,000 to office assistant) |
|
Total |
Rs 1,40,000 |
|
Total amount deducted in a year |
Rs 27,31,68,000 |
Total savings from salary cuts: Rs 52,35,80,400
Total savings from MP Local Area Development Scheme fund: Rs 7,900 crore
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