New Delhi: The government has approved a hefty 24% hike in the pay packets and pensions of members of Parliament (MPs), with retrospective effect from 1 April 2023.
The revision, carried out under the Salary, Allowances and Pension of Members of Parliament Act, 1954, is linked to the Cost Inflation Index specified in the Income Tax Act, 1961.
With this increase, MPs’ monthly salary rises from ₹1 lakh per month to ₹1.24 lakh, while their daily allowance increases by 25% from ₹2,000 to ₹2,500, as per a ministry of parliamentary affairs notification issued on Monday.
The pension for former MPs has also been revised upward by 24%, from ₹25,000 to ₹31,000 per month.
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This is the first such revision since April 2018, aimed at bringing earnings in line with inflation, as per the notification. However, the hike raises fresh questions about the income disparity between lawmakers and the general population.
According to data from the ministry of statistics and programme implementation, India’s per capita income in 2022-23 was estimated at ₹1.72 lakh, or roughly ₹14,333 per month. The figures indicate that even a retired MP now receives more than twice the average income of an Indian worker, while a sitting MP earns nearly nine times as much.
And this is excluding perks such as daily allowance (for attending Parliament), constituency allowance, free travel and government housing.
The decision to increase MPs’ salaries comes at a time when many Indians are grappling with inflationary pressures. Retail inflation in India has remained above the Reserve Bank of India’s comfort level of 4% for most of the past year, with food prices witnessing sharper spikes.
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Wage growth in several sectors, especially for informal workers, has not kept pace with rising living costs. The Periodic Labour Force Survey (PLFS) data for 2022-23 shows that the median wage of salaried employees in India is far lower than what MPs receive.
In addition, the issue of lawmakers determining their own pay hikes has long been a subject of debate. Critics argue that an independent commission should decide on such revisions, rather than MPs voting on their own salary increases.
Political analyst Arvind Mohan said that while inflation impacts everyone, the key question is whether salary revisions should be limited to MPs or if similar measures should be extended to other sections of society, particularly low-income groups.
After the salary and allowance hike for MPs, the government’s total annual expenditure on MPs has increased significantly. Each MP now costs the exchequer about ₹42.9 lakh per year, covering various components such as salary, allowances and perks.
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The hike in pay packet alone brings the annual salary expenditure per MP to ₹14.8 lakh. Additionally, MPs receive a daily allowance of ₹2,500, which, assuming 100 days of parliamentary sessions per year, adds up to ₹2.5 lakh annually per MP.
Apart from salary and daily allowances, MPs receive a constituency allowance of ₹70,000 per month, amounting to ₹8.4 lakh annually, and office expenses of ₹60,000 per month, which totals ₹7.2 lakh per year. Additionally, MPs are entitled to various travel and other perks, estimated at ₹10 lakh per year per MP.
With 788 MPs in total (543 in the Lok Sabha and 245 in the Rajya Sabha), the cumulative expenditure on all MPs has now reached about ₹3,386.82 crore per year. This expenditure includes salaries, allowances, office expenses, and estimated travel and other perks.
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