30% pay cut for PM, mins & MPs; MPLADS suspended

TIMES NEWS NETWORK

New Delhi:07.04.2020

The Union Cabinet on Monday approved an ordinance to cut salaries of the Prime Minister, all ministers and sitting MPs by 30% for one year in the wake of the Covid-19 crisis and also decided to suspend the MP Local Area Development Scheme (MPLADS) for two years. The twin moves will release ₹7,900 crore to combat the disease.

Information and broadcasting minister Prakash Javadekar told the media that President Ram Nath Kovind, Vice-President Venkaiah Naidu and governors of states have also voluntarily offered to take the 30% pay cut as a social responsibility. The move, intended as an austerity measure, reflects the thinking in government that the political class should signal that it is not standing apart from the economic hardship caused to the common people. The wage cuts will come into effect from April 1for a year and the suspension of MPLADS fund will be for 2020-21and 2021-22. The total amount will be transferred into the Consolidated Fund of India. Javadekar said the ordinance route was taken as a salary cut of MPs requires a change in law. He added the Salary, Allowances and Pension of Members of Parliament Act will be amended in the next Parliament session. The suspension of MPLADS, however, did not go down well with the opposition with several Congress leaders protesting that it will impact ongoing development works in their constituencies and affect people directly.

Lowest ever GST on imports in March

The Centre earned just over ₹18,000 crore through integrated GST (IGST) on imports in March — the lowest since the new tax regime kicked in 30 months ago. This indicates collections in the coming months may be weaker due to the pandemic, putting additional pressure on the Centre which faces demands for fiscal stimulus. Officials said the latest IGST numbers were probably on account of factory shutdowns in China and hence lower imports. P 13

Salary cut a landmark decision that sends right signals: Javadekar

The government said that most MPs would anyway set aside a substantial part of their constituency funds for Covid-19 mitigation.

Responding to a question on how much would be saved due to 30% salary cut, Javadekar said the amount was not important. “This is a landmark decision that sends the right signals. Many MPs have already announced to donate ₹1crore each from their MPLADS fund to fight Covid-19. Some felt the money under this scheme should be utilised to deal with the pandemic. This is our social responsibility,” the minister said. There has been concern in the government that if there are layoffs and wage cuts in non-government sectors, the perceived privileges of official jobs will stand out in sore contrast.

Asked if the Centre was expecting states to take similar decisions of pay cut for their MLAs and MLCs, Javadekar said it was a matter for state governments and the Centre could not comment on it.

Meanwhile, some states have already decided to do this. While the Kerala government has decided to cut a month’s salary of all its staffers and this will go to the state disaster relief fund, Telangana, Andhra Pradesh, Odisha and Rajasthan have also announced salary cuts of government employees depending on their rank. Maharashtra has decided to pay salaries in instalments. Karnataka chief minister B S Yediyurappa has given up a year’s salary.

DEALING WITH THE PANDEMIC: Prakash Javadekar