Row hots up over staff pension plans

Date: 22/05/03

By David Cronin

SHARPLY different accounts have been given by each side following talks between Romano Prodi and leaders of a strike over pension reforms which paralysed EU institutions on Tuesday (20 May).

According to one union leader, the European Commission president agreed to examine whether the reforms could be amended. But Prodi's spokesman Reijo Kemppinen insisted that the Italian had defended the accord reached by the Council of Ministers as "the best possible deal".

EU foreign ministers agreed on Monday to raise the pensionable age for new officials from 60 to 63, which will save more than €1 billion over the next 15 years. The present system allows officials to accrue two percentage points per year towards their pension entitlement, but that will be reduced to 1.9 for new recruits.

Kemppinen said: "The president said 'what is offered to you is a good package and should not be reopened'. Naturally, he can try to look into it, but he believes it is the best possible deal."

But Alan Hick, head of the Brussels branch of Union Syndicale, insisted that Prodi pledged to evaluate the agreement to see if it could be improved.

"You can say that 1.9 rather than 2 is marginal, but for us it is the thin edge of the wedge. The results would be a two-tier civil service. Civil servants from the accession states would be treated as second class.

"Prodi was rather shaken by the strength of our argument."

A paper prepared earlier this year by eight member states, including the UK, Germany and Sweden, estimated that the cost of the pension scheme for officials could rise from €736 million this year to €1.46 billion by 2020 if it is unchanged.

Reforms to the pensions system for employees at EU institutions are provoking criticism amogst staff there who walked out on strike on 20 May 2003 in protest.