Budget 2018: FM Arun Jaitley proposes pay hike for President and MPs

Finance Minister Arun Jaitley on Thursday proposed increasing the salaries of the President, Vice-President and Governors.

He also proposed a law for automatic revision of salaries of Members of Parliament (MPs), indexed to inflation, every five years.

“The emolument of the President, the Vice-president and the Governors were last revised with effect from 1st January, 2006. These emoluments are proposed to be revised to Rs 500,000 for the President, Rs 400,000 for the Vice-President and to Rs 350,000 per month for the Governors,” he said in the Budget speech. The President now gets Rs 150,000; the Vice-president Rs 125,000 and Governors Rs 110,000.

The increase in salaries and allowances of MPs would come into effect from April 1, 2018, Jaitley said. The proposed law for revision of salaries of Lok Sabha and Rajya Sabha members comes in the wake of criticism that MPs had until now been deciding their own salaries. In July 2015, the House committee on salaries and allowances, which was then headed by Yogi Adityanath, had recommended a 100 per cent increase. The proposal didn’t move forward in the face of criticism.

It was argued MPs shouldn’t be proposing the increase when there were the beneficiaries. There are norms for such raises for other government servants, and even the President, the Vice-president and Governors, it was said. The MPs had pointed out that their salaries and allowances were less than what their peers get in most democracies. The FM’s proposed law aims to blunt this criticism that MPs reward themselves by passing laws to increase their salaries.

Jaitley said the emoluments of the President, the Vice-President and the Governors were last revised with effect from January 1, 2006. They were getting salaries less than top bureaucrats and service chiefs after the implementation of the 7th Pay Commission's recommendations two years ago.

After the implementation of the Commission's awards on January 1, 2016, the Cabinet Secretary, the top-most bureaucrat, gets Rs 250,000 a month and a secretary in the Union government draws Rs 225,000 a month.

Law proposed to blunt criticism

• President’s salary increases to Rs 500,000 from Rs 150,000
• Vice-president’s salary increases to Rs 400,000 from Rs 125,000
• Governors’ pay rises to Rs 325,000 from Rs 110,00
• FM proposes a law for automatic revision of salaries of Members of Parliament
• MPs’ salaries to be revised from April 1, 2018
• Currently, government spends Rs 270,000 on each MP per month