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Salary Allowances and Pension of Members of Parliament (Amendment) Bill 2020 passed in Lok Sabah

Topics Covered: Indian Constitution- historical underpinnings, evolution, features, amendments, significant provisions and basic structure.

Salary, Allowances and Pension of Members of Parliament (Amendment) Bill, 2020 passed in Lok Sabah:


The bill seeks to amend:

  1. The Salary, Allowances, and Pension of Members of Parliament Act, 1954 to reduce the salaries of MPs by 30%.
  2. The Salaries and Allowances of Ministers Act, 1952, to reduce the sumptuary allowance of Ministers by 30%.
  3. Rules notified under the 1954 Act to reduce certain allowances of MPs for one year. These include constituency allowance and office expenses allowance.

These changes have been made for a period of one year effective from April 1, 2020.

Background:

These reductions are being made to supplement the financial resources of the centre to tackle the COVID-19 pandemic.

Methods for setting salaries, what constitution says?

Article 106 of the Constitution empowers MPs to determine their salaries by enacting laws.

In 1985, Parliament enacted a law that delegated the power to set and revise certain allowances of MPs such as constituency allowance, office allowance, and housing allowance to the central government.

Till 2018, MPs periodically passed laws to revise their salaries.

  • The Finance Act, 2018 provided that the salary, daily allowance, and pension of MPs will be increased every five years, on the basis of the cost inflation index provided under the Income-tax Act, 1961.

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Sources: the Hindu.