The corona crisis has not left anybody unaffected either directly or indirectly. The pandemic has also punctured the Indian economy’s revival plan putting more financial stress. Trying to ease that stress the government took a major step on Monday.
The government on Monday announced that President, Prime Minister and Governors of all states would face a 30% salary cut. This cut would be applicable for a period of 1year. That’s not all, Member of Parliaments (MPs) would also face this cut in salary. The money from the salary cut would go into the consolidate fund of India. This would be used for the fight against COVD-19.
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For the unknown Consolidated Fund of India includes revenues, which are received by the government through taxes and expenses incurred in the form of borrowings and loans. It is created under Article 268 of the Indian constitution. Generally such kind of salary cuts are a part of ‘financial emergency’. Thus, the move can be seen as an undeclared ‘Financial emergency’.
The salary cut is implemented by an ordinance amending the Salary, Allowances, and Pension of Members of Parliament Act, 1954. Another major decision that was announced by the government was about MPLAD (Member of Parliament Local Area Development) fund scheme. The MPLAD would be suspended for 2 years that is during 2020-21 and 2021-22. The money from this scheme would go for managing health services and the adverse impact of COVID-19 pandemic.
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Around Rs 7,900 crore would come from the MPLADS scheme. Meanwhile, states like Maharashtra, Rajasthan, Kerala, Odisha, Telangana and Andhra Pradesh have already decided on salary cuts for ministers and staff. India so far has crossed the 4,000 mark in terms of the number of cases.
