Friday, May 7, 2010

MPs in line for hefty pay hike but will have to wait

The government is ready to give the green signal to a substantial revision of MP salaries from Rs 16,000 to Rs 80,000 a month which will make the remuneration taxable once the Congress leadership takes a political call on the timing of the move. Since the salary proposal was not on the Cabinet agenda on Thursday, the required bill will not be brought to Parliament this session which ends on Friday. The report of the parliamentary committee on salaries and allowances was presented to Lok Sabha Speaker Meira Kumar on Wednesday evening.

The speed with which the report of the joint committee was presented to the Speaker was intended to facilitate the proposals being placed for approval before Parliament by Friday. Though finance minister Pranab Mukherjee was persuaded to go along, it is learnt that the proposal would need Congress chief Sonia Gandhis nod. There was some anticipation that the Cabinet may consider the matter. But while MPs and leaders are keen, a more considered view is awaited and MPs will have to bide their time till the monsoon session. The report of the committee headed by Congress MP Charan Das Mahant has recommended that salaries of MPs be fixed at Re 1 more than that of secretaries to the government of India. Official sources pointed out that the low Rs 16,000 a month salary with money allotted under various allowances was structured to save on tax and the committees suggestion that this subterfuge be done away with was welcome. Why not pay MPs their salaries upfront and pay the tax. The MPs feel their salaries should be at par with senior civil servants, they said.

The report suggested an increase in free air journeys from 34 to 50, hike in daily allowance to Rs 2,000 for period of residence on duty. Office expense allowance would be enhanced to Rs 60,000 a month from existing Rs 20,000. This includes salary of an office assistant to Rs 30,000 a month, pay of Rs 14,000 to an office attendant and stationery expenses of Rs 12,000 a month.The committee has suggested that constituency allowance be hiked to Rs 40,000 a month from Rs 20,000 at present while free local phone calls be increased from 1.5 lakh a year to 2 lakh. MPs should be able to avail a loan of Rs 5 lakh for a vehicle at a 5% rate of interest.

The panel has also made some recommendations about pensions of ex-MPs being enhanced to be at par with former secretaries as on December 31,2005. The government is not likely to accept all the recommendations like those relating to pension but the essential revision of salaries and attendant allowances might pass muster.

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