Nripendra Misra & Tannu Singh: Setting standards and salaries

An oversight body for the pay and privileges of members of Parliament is overdue

Our Parliament, as the highest democratic public office, is expected to set standards for probity, accountability and transparency. The salaries and allowances of our MPs are regulated through the Salaries and Allowances of Ministers Act, 1952. It has been amended 28 times since its inception. The process involves a proposal by the Cabinet for the revision of various types of remuneration and the Parliament passes the Bill into an Act. Such amendments are not debated, and generally get passed by voice vote. The accompanying tables show revisions of basic salaries, daily allowances and pensions between 1954 and 2000 and from 2000 to 2010.

The rationale for revisions may be justified. However, public perception and possible conflicts of interest are too obvious in this power conferred on our Members of Parliament by the Constitution of India. To expect the beneficiaries of such decisions to be free of all kinds of biases and prejudices in setting and raising their own salaries and allowances is not realistic. Many developed countries have very elaborate institutional backing on this very subject. There are independent authorities to regulate the salaries and allowances of parliamentarians. An empowered institutional mechanism to oversee and streamline the maintenance of and high standards in public life would further enhance the credibility of Indian parliamentarians as well as of India’s democracy as a whole.

A possible model for the adoption of a minimalistic agenda can be found in the practices followed in countries like Australia, the United States of America and the United Kingdom. There is an independent body called the Remuneration Tribunal, which is responsible for setting and revising of parliamentary remuneration and allowances in Australia. Earlier, the Australian parliament had powers to determine its pay and allowances. A committee headed by Justice Kerr in 1971 recommended the formation of a Standing Tribunal to conduct enquiries into parliamentary pay. This led to the passage of the Remuneration Tribunal Act, 1973. There have been efforts to curtail the powers of the Tribunal but the passage of the Remuneration and Other Legislation Amendment Act, 2011 paved the way for determination of parliamentary base salary by the Tribunal. Thus the Tribunal’s making of Determination 2012/02, setting a base salary from March 15, 2012 means that any provision in the Remuneration and Allowance Act in relation to parliamentary base salary is now obselete and is only determined by the Tribunal.

In the US, the pay revision of Congressmen is a legislative function. However, there is an inbuilt adjustment procedure for the revision of salaries of legislative members whereby the direct involvement of the beneficiaries is either minimal or absent. The 27th Amendment to the US Constitution, which intends to prevent members of Congress from granting themselves a pay rise during the course of a session, states that “No law, varying the compensation for the services of the Senators and Representatives, shall take effect, until an election of Resentatives shall have intervened”.

The UK model on the subject is most vibrant and is ideally suited for adoption in our context. There are multiple independent regulators present to guard against not only arbitrary rises in the renumeration of MPs but also to oversee the maintenance of high standards of public life in the UK parliament. The first such office is that of the Parliamentary Commissioner for Standards, an independent officer of parliament whose function includes the registration of financial interests held by MPs and the investigation of complaints about MPs who have allegedly breached the Code of Conduct or related rules.
   

Table 1 : Increases in emoluments of MPs in India over four decades, 1954-2000
Component of compensation	MP’s Salary & Allowances in 1954	MP’s Salary & Allowances in 2000	% increase in four decades
Basic Salary	Rs 1,500	Rs 4,000	167
Daily Allowance	Rs 200	Rs 400	100
Pension	Rs 1,500	Rs 2,500	67

   

Table 2 : Increases in emoluments of MPs in India over the decade 2000- 2010
Component of compensation	MP’s Salary & Allowances in 2000	MP’s Salary & Allowances in 2010	% increase in one decade
Basic Salary	Rs 4,000	Rs 50,000	1,150
Daily Allowance	Rs 400	Rs 1,000	150
Pension	Rs 2,500	Rs 20,000	700

Then there exists the independent national-level Committee on Standards in Public Life, which advises government on ethical standards in public life across the UK. This body was established in 1994 out of concern for unethical conduct among MPs, but has now acquired a much broader independent role of promoting high standards of behaviour in the public sphere as a whole. Over the years it has come out with many important reports on political party finances, MPs’ expenses and allowances and so on.

The review body on senior salaries, or SSRB, looking specifically into the renumeration aspect, provides independent advice to the prime minister from time to time on the pay and pensions of MPs and their allowances; on peers’ allowances; and on the pay, pensions and allowances of ministers. It also advises the Lord Chancellor and the secretary of state for defence on the remuneration of holders of judicial office; senior civil servants; senior officers of the armed forces; and other such public appointments as may from time to time be specified.

In addition, there also exists the Independent Parliamentary Standards Authority (IPSA) established through the Parliamentary Standards Act, 2009, on the recommendation of the Committee on Standards in Public Life. Restricting itself mainly to finances, IPSA is charged with making a clean break from the past by independently monitoring and controlling MPs’ expenses, pay and pensions. It also regularly publishes details of MPs’ expense claims.

Looking at the frequent amendments in the remuneration and allowances of our parliamentarians, it is fair to state that an independent body’s involvement in the setting and revision of the salary and allowances of MPs should be formalised urgently.

 

Misra is director of the Public Interest Foundation, and an ex-chairman of Trai. Singh is a research associate at the Public Interest Foundation.
www.publicinterestfoundation.com