Government notification implements inflation-adjusted compensation changes for parliamentarians

The Indian government has officially implemented a 24% salary increase for Members of Parliament (MPs), according to a notification issued today by the Ministry of Parliamentary Affairs. The salary adjustment, which took effect retrospectively from April 1, 2023, raises the monthly compensation for parliamentarians from ₹1 lakh to ₹1.24 lakh.

Contents hide
Comprehensive Compensation Revision
Economic Rationale Behind the Increase
Impact and Implementation Timeline
Parliamentary Compensation in Context

Comprehensive Compensation Revision

The notification outlines a complete revision of the compensation package for both current and former parliamentarians. In addition to the base salary adjustment, several other financial components have been enhanced:

  • MPs will now receive an increased daily allowance of ₹2,500, up from the previous ₹2,000
  • Monthly pensions for former MPs have been raised to ₹31,000, marking a significant increase from the earlier ₹25,000
  • Additional pension benefits for extended service have also been improved, with MPs receiving ₹2,500 per month for each year served beyond the initial five-year term, compared to the previous rate of ₹2,000

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Economic Rationale Behind the Increase

The adjustments are linked to the Cost Inflation Index as specified in the Income Tax Act of 1961, indicating that the increases are designed to maintain the purchasing power of parliamentarians’ compensation in the face of rising living costs. This structured approach to salary revision falls under the provisions of the Salary, Allowances and Pension of Members of Parliament Act.

An official from the Ministry, speaking on condition of anonymity, explained: “These adjustments ensure that parliamentary compensation keeps pace with economic realities while maintaining fiscal responsibility.”

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Impact and Implementation Timeline

While the notification was issued today, the implementation applies retroactively, meaning MPs will receive arrears dating back to April 2023. The financial implications for the national treasury have not been detailed in the notification, though analysts suggest the overall budget impact will be relatively modest given the limited number of beneficiaries.

Parliamentary affairs experts note that periodic revision of MP salaries is essential for ensuring that public service remains accessible to citizens from diverse economic backgrounds.

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Parliamentary Compensation in Context

This marks the first major revision to MP compensation since the previous adjustment in 2018. The parliamentary compensation structure in India includes various components beyond the basic salary, such as constituency allowances, office expenses, and travel benefits.

The Ministry has indicated that further details regarding the implementation process will be communicated directly to current and former parliamentarians in the coming weeks.

 

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