MEPs backtrack over audit of office expenses

The annual amount of €50,000 that MEPs are given to run their constituency offices will not be systematically audited under new rules on pay and expenses being drawn up by senior MEPs.

A special working group chaired by French Socialist MEP Martine Roure, a vice-president of the Parliament, which includes three other vice-presidents and three quaestors, has been working on rules to implement the deal on MEPs’ pay and expenses agreed with EU government leaders in 2005.

The deal will introduce from 2009 a common salary of €7,413 monthly gross, ending the current system by which MEPs are paid the same as their counterparts in national parliaments. That system meant great disparities in salaries between MEPs, depending on their national delegations. Italian MEPs are paid €144,000 a year while, at the other extreme, Latvian MEPs are paid €12,500.

From 2009, MEPs will be reimbursed for travel expenses to and from Strasbourg and Brussels only if they can provide full receipts.

But MEPs on the working group are divided over how to deal with two other issues: expenses for running a constituency office and rights to the Parliament’s voluntary pension scheme.

The working group is currently discussing whether MEPs should be required to keep receipts for all - or half - of expenses related to running constituency offices, for which MEPs receive around €4,000 a month. They would not necessarily have to provide the receipts prior to reimbursement, merely retain them in case of checks.

UK Liberal Democrat MEP Diana Wallis, one of the four Parliament vice-presidents in the group, said: "It had been hoped that we would move to general transparency."

She said that the current proposals under discussion fell short of the package agreed in 2005 between the Parliament and EU governments, which required MEPs to provide receipts or vouchers for at least half of their expenses.

"There is a moral obligation on members to keep receipts but it doesn’t mean they are being checked or audited," she said.

There are also concerns that the current additional voluntary pension scheme for MEPs will be continued for two mandates - ten years - after 2009 even though the new package includes a centrally funded pension scheme for all MEPs.

"We know the scheme has been criticised. You could have brought it to an end more quickly," Wallis said.

The arrangements for the existing additional voluntary pension scheme have been criticised by some MEPs and by the Parliament’s external auditor, the European Court of Auditors.

MEPs can have their contributions deducted directly from their general office expenses (which is not supposed to cover pension payments) but there is no systematic checking to make sure that MEPs reimburse their office funds.

Wallis said that despite the disagreements on some of the issues, getting an agreement on the whole package on pay and expenses would be "a huge gain" because it would ensure that travel expenses were paid only on the basis of actual costs.

The draft rules will be circulated to political group leaders for discussion and are expected to be agreed in late February or early March.

When the new statute comes in, MEPs will pay tax at the same rate as staff in the EU institutions, 20-30% depending on marital status and number of children, but MEPs from some countries, including the UK and Sweden, will pay a top-up charge so that they pay tax at the same rate as national members of parliament.

Member states will also be able to keep their MEPs on the current system for a further two Parliamentary terms if they wish, so the new rules would not apply to their MEPs until 2019. Currently serving MEPs who are re-elected in 2009 can also choose to stay under the current scheme until 2014.

The annual amount of €50,000 that MEPs are given to run their constituency offices will not be systematically audited under new rules on pay and expenses being drawn up by senior MEPs.