Levelling out the pay differences

MEPs, regardless of their nationality, will soon receive the same annual wage. Judith Crosbie reports.

As long ago as 22 May 1997, European Voice reported that plans to reform the system of Parliamentary allowances for MEPs and introduce a uniform European statute for members were running into unexpected difficulties and delays.

The difficulties proved so great that it was June 2005 before an agreement on an MEPs’ statute was agreed, at last putting to rest a long-running point of contention.

But the statute will not come into effect until after the next Parliamentary elections, set for June 2009.

The changes agreed by EU leaders are enormous. MEPs have, up to now, been paid by their individual national governments, at different rates of pay and tax. So Italian deputies were being paid more than €144,000 per year and Latvian deputies were getting barely €12,500 a year.

Under the new statute they will (eventually) all be put on a common pay-scale, paid from the EU budget and taxed at the same EU rate.

MEPs will earn a salary of €84,000 per year - a figure set at 38.5% of what a judge at the European Court of Justice earns.

National delegations will be able to put off the new salary arrangements for current serving MEPs for another ten years until 2019.

MEPs will be taxed at 20-30%, based on their marital status and number of children, which for some MEPs from high-tax economies will mean greater take-home pay. They will receive a European pension, funded one-third by themselves and two-thirds by the Parliament.

The MEPs had held out against changes to their system of allowances, until there was agreement from the national governments on a common statute.

From 2009, travel allowances will be changed, with MEPs reimbursed only for the actual costs incurred in travelling to Brussels or Strasbourg. Hitherto they have been paid the cost of a fully-refundable and changeable economy class airline ticket, which left those who travelled more cheaply able to profit from the difference.

So will the changes introduced by the statute mean that the issue of MEPs’ salaries and expenses disappear from the campaign agenda in the run up to the 2009 elections? Hans Peter Martin, an Austrian journalist turned MEP who exposed how some of his fellow MEPs assiduously harvested their allowances, thinks not.

"This is nothing more than an old Soviet system of wheeling and dealing by people who claim that they are fostering European ideals, but on the contrary only care about themselves," he said, soon after the deal was agreed in June 2005.

Chris Davies, a UK Liberal Democrat (ALDE) MEP, believes that the statute agreed was a good compromise but that many issues remain to be resolved. "I was pleased about the statute in that it was a step forward…but in countries where this is a relevant issue it will come up again ahead of the elections," he said.

Davies says that changes should be made to the declaration of interests, that MEPs are required to make. Only ‘office holders’, such as vice-presidents or chairmen of committees, are required to file yearly updates. Davies has filed an amendment to the European Commission’s proposal on transparency, calling for a survey to be carried out of how the national parliaments across the EU file their declarations of interests and adopt a good model. "Why wait for a scandal? Why wait until some MEP who always speaks and votes on defence issues suddenly is found out to be an arms-seller?" asked Davies.

Davies has also been campaigning to change the way MEPs make contributions to their pensions. The European Court of Auditors criticised the practice by which MEPs can pay their contributions from office expenses but are supposed to pay this expense account.

Davies says this money is not always paid back by deputies and abuses are permitted by the poor scrutiny. "The Parliamentary authorities do not facilitate honesty. The Parliamentary authorities facilitate malpractice," he said.

"I don’t go along with the idea that MEPs are paid too much money but we need to develop a transparent auditing system and insure against the inappropriate use of public money," Davies added.

MEPs, regardless of their nationality, will soon receive the same annual wage. Judith Crosbie reports.