Eurocrats Take the Gravy Train. This is the way the fat cats ride…

First Published: 2005-11-24

Reprinted with the kind permission of Mr. Joseph A. Harriss.

The taxi driver was impressed. "To the new European Parliament building?" he asked with a wink, a knowing grin spreading across his face. "I hear you people have bathrooms in every office."

I quickly assured him I wasn't a member of the European Parliament (MEP), only a visitor. I didn't want to risk the smoldering resentment many Bruxellois feel over the well-paid foreigners who fill the city's finest restaurants, drive up rents, and clog the streets with their flashy cars without paying a cent of Belgian tax. As we reached the grandiose, 15-story, glass-and-steel mass that now hulks over north-central Brussels, he turned to me and confided, "You know what we call it here? The Whim of the Gods." After passing through the vast entrance, I saw why.

What was for years the biggest construction project in Europe is today a cavernous, Pharaonic palace occupying an eight-and-a-half-acre site, which cost some $1billion to build. For their nearly $130 million in annual rent–plus small matters like $5.5 million for utilities, $9.6 million for cleaning and maintenance–Europe's taxpayers have a parliament building that dwarfs any other. London's storied Westminster, Paris's elegant Assembl?e Nationale, Bonn's modern Bundestag all pale beside this monument to public spending.

Amid its vast spaces–some corridors are so wide you could drive a car down them–soft lighting and endless vistas, staff members pad around on gray carpeting amid walls faced with polished white marble and gray granite.

MEP's offices come complete with a sofa and a $10,000 bathroom. When EU planners noticed that the showers had only curtains, they replaced them with more elegant sliding doors. Cost: $375 each.

The cost of both the bathrooms and the building itself make Belgian MEP Jaak Vandemeulebroucke fume. "These bathrooms are just plain silly," he says. "We don't live here, after all. Who takes a shower at three in the afternoon?"

Brussels has hundreds of eateries and some of the finest restaurants in Europe. Nevertheless, MEPs and their staff have four restaurants and three bars–not to mention three banks, a post office, and a travel agency. If they want to work out, there's a fitness center, a squash court and saunas. If their brains get stressed by making rules, there's even a meditation room.

And yet, despite all this opulence, the new parliament will be used for only 14 days a year. Twelve plenary sessions will be held in Strasbourg, in a grandiose second parliament, which is now being built at a cost of around $507 million.

Meanwhile, as many EU citizens are struggling with high taxes, high unemployment and job insecurity, the 30,000 EU civil servants in offices throughout Europe are waving happily from first-class seats on one of the last of the great gravy trains.

How did this happen? The open secret is that the European Commission sets its own pay and perks. The result: jobs virtually guaranteed for life, accompanied by salaries, benefits and allowances that make many other Europeans' incomes look puny.

Civil servants in most European countries are reasonably well paid. Ironically, even they envy counterparts in the EU. For example, a top-ranking EU official makes over $2,000 a month more than a British MP.

When the European Medicines Evaluation Agency opened in London in 1995, British medical researchers were shocked at the difference between their pay and that of EU colleagues.

"They are paid much more than civil servants doing the same job at our own Medicines Control Agency," says David Luxton of the Institution of Professionals, Managers and Specialists.

Similarly, the European Patent Office in Munich has raised German eyebrows over how much Eurocrats are paid. When the Bavarian state government did a study of the situation, it found that German civil servants were making only 60 to 71 percent as much as EU employees. At the Patent Office itself, just down the street from the German Patent Office, the gap is even greater: Eurocrats pull down 17,160 DM net per month, vs. 8,946 DM for a German employee–92 percent more.

Most international organizations offer good pay and perks. They justify this by the need to be multilingual and to work abroad. But even by those standards, Eurocrats do very well indeed. A survey by the Geneva-based Federation of International Civil Servants' Associations (FICSA) shows EU manager-level fat cats to be the fattest of all. Compared with the UN, the income gap is astonishing: "Salaries in the EU in Brussels are between 30 and 43 percent higher than in the UN," the report states.

Forty years ago, when the foundations of today's EU were being laid, special incentives may have been needed to lure qualified personnel from the six original member states to leave safe jobs at home and head for Brussels. But that's no longer the case. When 300 upper management positions were advertised in 1993, the personnel department received 55,000 applications from job-hungry Europeans. Here's what the package includes:

Pay for the typical mid-level EU official is about $6,100 a month. But that's just basic pay. For the overwhelming majority of Eurocrats who are expatriate there is an immediate pay allowance of 16 percent extra. This continues for as long as the employee works for the EU. There is also an installation allowance equal to one or two months' salary.

Setting up a new home can be costly, so EU staff are entitled to buy a car and household appliances tax free–in Brussels, that means 21 percent off list price–for the entire first year's employment.

Nine "European Schools" exist to teach some 16,000 Eurochildren–of whom 60 percent are the offspring of EU personnel–using an EU subsidy of nearly $98 million. The schools are free for the children of EU employees.

In the unlikely event that they decide actually to leave their job, Eurocrats are entitled to a resettlement allowance of up to two months' salary, plus travel expenses back to their place of origin. Members of the Commission, Court of Justice or High Authority get a "transitional allowance" for three years after leaving the EU.

Eurocrat pleasure costs less than ours. Brussels staff can belong to some 50 subsidized leisure clubs for sports and cultural activities.

On retirement, all family, household and education allowances continue. In the state sector, most Europeans' pensions nowadays are calculated on the average of the previoius several years' income–usually lower than the last year. The EU works them out on the basis of the highest, final salary.

Eurocrats fork out 8.25 percent of basic pay for these pensions. This is only a third of the real cost, with you-know-who paying the rest. "It really is a sweet deal," says a private pensions consultant. "Proof of this is that they have the right to switch out of the EU plan to their national pensions, but no one ever does."

Last year the EU paid out a whopping $421 million from its operating budget to 8,700 pensioners drawing an average of $48,300 a year. As more and more Eurocrats reach pension age, the plan is now straining the Commission budget.

Most MEPs earn considerably less than EU officials (they are paid the same as members of their own national parliaments) yet they can, and do, claim lavish expenses. With monthly allowances for office staff and "other costs" running at up to $9,400 a month, many MEPs employ wives or other relatives to keep it all in the family.

In addition, the daily $230 allowance for attending debates and committee meetings is good pocket money, especially when you can sign the register on Friday morning, then take off for the airport and home, as a recent TV documentary caught some doing.

And then there are the travel reimbursements. In one recent investigation the EU Court of Auditors found that 69 percent of claims for reimbursement for airline travel were unwarranted. Rules now require MEPs to produce actual proof of travel–a boarding pass, or rail ticket. But since they still get paid a set rate for a set route, regardless of the actual costs incurred, members can simply take a cheaper travel option and pocket the difference.

Some MEPs have been getting as much as $290,000 a year in travel and office allowances–totally unacceptable, say reformers, who point to mounting public criticism.

"Sleaze in the European Parliament is rising to the level where it risks doing very seriious damage to the image of the institution," warned Dutch MEP Gijs de Vries recently in the European Voice. Adds Pauline Green, MEP for London North, "How can we concentrate on developing a shared vision of the future if the people of the EU have lost faith in us?"

While moves are at last being made–albeit slowly–to rein in MEPs allowances, the question of civil servants' pay and perks remains.

"Does the Commission agree that the salaries paid–at all levels–in the Community institutions are excessively high?" asked Italian MEP Luigi Florio in a written question. The answer he received: "The Commission feels that an objective comparison with the remuneration in national civil services can only be made on the basis of comparable living and working conditions, i.e., a comparison with national civil servants working abroad." Translation: no comment.

The first step towards reform is obvious: abolishing the exclusive right of the Commission to decide how much its employees earn.

The question won't go away. "We can no longer ignore public opinion," says Irish MEP Patricia McKenna. "At the end of the day it's the European taxpayer who is footing the bill."

Jaak Vandemeulebroucke agrees. "We need to change this crazy situation of over-generous remuneration. We can change things. We have the right to do it. We must do it."

Reader's Digest International Edition, September 1998.

Mr. Harriss is also the author of two books, "The Tallest Tower: Eiffel and the Belle Epoque," and "About France,"

The views expressed are those of the author, and not necessarily those of the Nassau Institute (which has no corporate view), or its Advisers or Directors.

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