Context: Recently, the Union Cabinet has approved a 30% cut in the salaries of all Members of Parliament for a year and a two-year suspension of the MP Local Area Development (MPLAD) scheme so that the amount saved can go to the Consolidated Fund of India to fight COVID-19.
About 30% Salary Cut

• It is applicable to all MPs, including the Prime Minister and the Council of Ministers, for the financial year 2020-2021.
• The President and Vice-President of India along with all the State Governors, have also decided on their own to take a 30% salary cut.
• However, the amendment will only cut MPs’ salaries, not allowances or the pensions of ex-MPs.
• According to the pay hike in 2018, each MP draws a monthly salary of ?1 lakh, ?70,000 as constituency allowance and ?60,000 for running office besides other perks.

About Suspension of MPLADS

• The amount saved from the scheme would be around ?8,000 crore and will be redirected to the Consolidation Fund.
• Many MPs had already pledged to use their MPLADS funds for efforts to combat the coronavirus pandemic.
• 74 Rajya Sabha members had contributed a total of ?100 crore, and 265 Lok Sabha members had given a total of ?265 crore.
• Currently, the Lok Sabha has 542 members while the Rajya Sabha has a strength of 245 members, including 12 nominated.
• The comprehensive decision was taken to convey the message of social responsibility of the MPs.

About MPLADS

• It was launched in December, 1993, to provide a mechanism for the Members of Parliament to recommend works of developmental nature for creation of durable community assets and for provision of basic facilities including community infrastructure, based on locally felt needs.
• The MPLADS is a Plan Scheme fully funded by Government of India. The annual MPLADS fund entitlement per MP constituency is Rs. 5 crore.

Special Focus of the Scheme

• MPs are to recommend every year, works costing at least 15 per cent of the MPLADS entitlement for the year for areas inhabited by Scheduled Caste population and 7.5 per cent for areas inhabited by ST population.
• In order to encourage trusts and societies for the betterment of tribal people, a ceiling of Rs. 75 lakh is stipulated for building assets by trusts and societies subject to conditions prescribed in the Scheme Guidelines.

Works under the Scheme

• Works, developmental in nature, based on locally felt needs and always available for the use of the public at large, are eligible under the scheme.
• Preference under the scheme is given to works relating to national priorities, such as provision of drinking water, public health, education, sanitation, roads, etc.

Release of Funds

• Funds are released in the form of grants in-aid directly to the District Authorities.
• The funds released under the scheme are non-lapsable.
• The liability of funds not released in a particular year is carried forward to the subsequent years, subject to eligibility.

Execution of Works

• The MPs have a recommendatory role under the scheme. They recommend their choice of works to the concerned district authorities who implement these works by following the established procedures of the concerned state government.
• The district authority is empowered to examine the eligibility of works sanction funds and select the implementing agencies, prioritise works, supervise overall execution, and monitor the scheme at the ground level.

Recommendation of Works

• The Lok Sabha Members can recommend works in their respective constituencies.
• The elected members of the Rajya Sabha can recommend works anywhere in the state from which they are elected.
• Nominated members of the Lok Sabha and Rajya Sabha may select works for implementation anywhere in the country.

About Salaries and Allowances of Members of Parliament

• Salaries and allowances of members of either Houses is determined by the Parliament.
• No provision of pension in the Constitution. However, in 1954, the Parliament enacted the Salaries, Allowances and Pension of Members of Parliament Act.
• In 2010, the salary of members increased from 16,000 to 50,000 p.m.
• Office expenses allowance from 20,000 to 45,000 p.m.
• The daily allowance from 1,000 to 2,000 (for each day of residence on duty)
• The constituency allowance from 20,000 to 45,000 p.m.
• Members are entitled to a pension on a graduated scale for each 5-year-term from 1976.
• Besides, they are provided with travelling facilities, free accommodation, telephone, vehicle advance, medical facilities, etc.