Cabinet approves 55% hike in monthly allowances of MPs by Rs 40,000

The monthly allowances of Members of Parliament (MPs) are all set to increase by Rs 40,000 per month, with the Union Cabinet on Wednesday approving up to 55 per cent hike.

At a meeting chaired by Prime Minister Narendra Modi, the Cabinet approved the amendment to allowance rules effective from April 1, which will have additional financial implication of more than Rs 390 million and Rs 66.4 million on account of recurring and
non-recurring expenditures respectively.

Now MPs will be paid to Rs 70,000 per month as constituency allowance instead of Rs 45,000 per month at present. Similarly, office expenses allowance has also been increased to Rs 60,000 from Rs 45,000, the Parliamentary Affairs Ministry said in an statement.

Besides these two allowances, the furniture allowance which is being paid to the parliamentarians once in five years is also increased to Rs 100,000 from Rs 75,000.

All the allowances will automatically increase after every five years starting from April 1, 2023, on the basis of cost inflation index.

The decision of the Cabinet will be conveyed to Joint Committee on Salaries and Allowances of Members of Parliament for making amendments in the relevant rules.

It will be approved and confirmed by the Chairman and the Speaker and will be published in the Official Gazette, the ministry said.

Finance Minister Arun Jaitley had already announced in his budget speech that a permanent mechanism would be set up to revise the salaries of MPs every five years, and it would be linked to inflation.

The basic pay of the parliamentarians is also set to be doubled to Rs 100,000, effective from April 1.

As of today, excluding the Speaker, the Lok Sabha has 536 MPs, including two nominated from the Anglo-Indian community. There are eight vacancies.

The Rajya Sabha has 239 members.