The government on Monday announced that the Cabinet had approved temporary suspension of Members of Parliament Local Area Development Scheme (MPLADS) for the next two years.
These funds, Information and Broadcasting Minister Prakash Javadekar announced, would be utilised to manage the fallout from the novel coronavirus and to battle the outbreak.
"The President, Vice President, the Governors have also voluntarily decided to take a pay cut," he added.
During the briefing, Javadekar announced that the consolidated amount of MPLAD Funds for two years, around Rs 7,900 crores, will go to the Consolidated Fund of India.
So what exactly is the Consolidated Fund?
According to a Financial Express report, the consolidated fund is one of three parts of the country's Annual Financial Statement. The other two parts are the Contingency Fund and the Public Account. The Centre as well as each state has a Consolidated Fund of its own. In the context of today's news, the Fund that is being referred to is the Consolidated Fund of India.
It was created under Article 266 of the Indian Constitution.
Where does the Consolidated Fund usually get its money from?
The fund includes revenues received by the government through various sources. This includes money generated from taxes, money earned from public sector undertakings or from the government's general services, disinvestment receipts, debt repayments, loan recoveries and the like.
How is money from the fund withdrawn and used?
Money can be withdrawn from the consolidated fund only after the government secures the approval of the Cabinet. However payments charged to the Fund are non-votable charges that have to be paid even without the Budget being passed. Money from the fund is used to pay the salaries of officials including the President, the Speaker and Deputy Speaker of the Lok Sabha as well as the Chairman and Deputy Chairman of the Rajya Sabha, and the salaries of Supreme Court judges and the pensions of SC and High Court judges.
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