# EUR-Lex - 52013PC0896 - EN

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# 52013PC0896

**Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL adjusting with the effect from 1 July 2012 the remuneration and pensions of the officials and other servants of the European Union and the correction coefficients applied thereto /* COM/2013/0896 final - 2013/0439 (COD) */**

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EXPLANATORY MEMORANDUM

Context of the proposal

110 || Grounds for and objectives of the proposal Following the judgment of the European Court of Justice of 19 November 2013 in Case C-63/12, the Commission must submit a new proposal on the basis of Article 10 of Annex XI to the Staff Regulations. According to this Article, the Commission is to submit appropriate proposals on which the European Parliament and the Council shall decide in accordance with Article 336 of the Treaty on the Functioning of the European Union. On 31 August 2012, the Commission submitted a Report to the Council on the exception clause (Article 10 of Annex XI to the Staff Regulations) (COM (2012) 476) and on 5 December 2012, the Commission submitted to the Council a Commission staff working document on the exception clause (SWD (2012) 428). The Court of Justice stated that when the assessments made by the Commission and the Council result in opposite conclusions, the Commission must submit to the European Parliament and to the Council appropriate proposals on the basis of that Article, in order to involve the European Parliament and to allow the legislators to decide on the appropriate measures to be taken with regard to the existing economic and social situation in the Union (paragraph 76). According to the judgment, the Commission has a margin of appraisal as regards the appropriate character of the proposals, given the economic and social data, as well as, where necessary, other factors to be taken into consideration, such as those that are relevant to human resources management and, in particular, the needs of recruitment (paragraph 74). The Commission reports mentioned above refer systematically to a stagnation and an ongoing crisis as well as a high level of unemployment rate and a high level of public deficit and debt in the European Union, though not concluding that the criteria set in Article 10 of Annex XI to the Staff Regulations are met.  As the Court judged that the Commission has no margin to decide whether or not to trigger the exception clause with regard to these criteria, the procedure laid down in Article 10 of Annex XI to the Staff Regulations constitutes the only means of taking account of an economic crisis in the adjustment of remuneration and therefore of disapplying the criteria laid down in Article 3(2) of that annex. The Commission shall take this economic and social data into account in order to propose appropriate measures to derogate from the strict application of the method. At the same time, since 2011, there have been a number of relevant developments. The European Parliament and the Council have adopted a reform of the Staff Regulations which includes a suspension of adjustments of salaries, allowances and pensions in 2013 and 2014 leading to a freeze for two years and several significant changes to the working conditions of staff of the EU institutions such as measures with regard to weekly working time, career, pensions and leave days which lead to significant savings. Taking into account the result of the normal application of the method in 2012, the social and economic situation, the reform of the Staff Regulations as well as the situation with regard to recruitment and management of human resources observed over the last years, the Commission concludes that the present proposal as well as the proposal for the adjustment of 2011 would be appropriate measures to be taken by the legislator based on Article 10 of Annex XI to the Staff Regulations.  Under Article 65 of the Staff Regulations the remuneration and pensions shall be updated before the end of each year. In this regard, the urgent implementation of the Judgment of the Court of Justice in Case C-63/12, issued on 19 November 2013, constitutes a due reason for adopting this Regulation rapidly. Elements of the new method determining the content of the Proposal The Eurostat report was submitted to the Council on 5 December 2012 (SWD (2012) 427). According to this report, the average change in the purchasing power of national civil servants’ remuneration in the reference period measured by the specific indicator is equal to -1.1%. The change in the cost of living in Brussels in the reference period is equal to 2.8%. The amount of the adjustment is obtained by multiplying together the specific indicator and the Brussels International Index calculated by Eurostat. The proposed adjustment to remuneration and pensions in Belgium and Luxembourg was therefore 1.7%. The amount of the adjustment must be corrected to take into account the above mentioned elements. The Commission considers therefore as appropriate to reduce the proposed adjustment to remuneration and pensions in Belgium and Luxembourg to 0.9% instead of 1.7% with regard to the strict application of the method.

120 || The economic parities for remuneration establish the purchasing power equivalence of the remuneration paid in Brussels, as the reference city, with that paid in the other places of employment. Eurostat has calculated those parities in agreement with the national statistical bodies. The economic parities for pensions establish the purchasing power equivalence of the pension paid in Belgium, as the reference country, with that paid in the other countries of residence. Eurostat has calculated those parities in agreement with the national statistical bodies. With regard to the parallel proposal for 2011, the same approach would result in an adjustment of 0.9% instead of 1.7%. The new proposals for 2011 and 2012 would therefore in effect reduce the result of the normal application of the method in force in 2011 and 2012 by 47%.

130 || Existing provisions in the area of the proposal Article 65, Article 10 of Annex XI and Article 19 of Annex XIII of the modified Staff Regulations.

Consultation of interested parties and impact assessment

|| Consultation of interested parties

211 || Methods of consultation used, main sectors covered and general profile of respondents The elements of the proposal have been discussed with the staff representatives in accordance with the appropriate procedures.

212 || Summary of replies received and the way in which they have been taken into account The proposal takes account of the opinions of the parties consulted.

Budgetary implications

401 || The impact of the adjustment to remuneration and pensions on administrative expenditure and on revenue is detailed in the financial statement annexed hereto.

2013/0439 (COD)

Proposal for a

REGULATION OF THE EUROPEAN PARLIAMENT
AND OF THE COUNCIL

adjusting with the effect from 1 July 2012
the remuneration and pensions of the officials and other servants of the
European Union and the correction coefficients applied thereto

THE EUROPEAN PARLIAMENT AND THE
COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the
Functioning of the European Union,

Having regard to the Staff Regulations of
Officials of the European Union and in particular Article 10 of Annex XI thereof
and the Conditions of Employment of Other Servants of the European Union,

Having regard to the proposal from the
European Commission,

Acting in accordance with the ordinary
legislative procedure,

Whereas:

(1)       In order to comply with
the Judgment of the Court of Justice in Case C-63/12, when the Council
establishes that at this stage of the procedure there is a serious and sudden
deterioration in the economic and social situation within the Union, the
Commission must submit a Proposal under Article 336 in order to involve the
European Parliament in the legislative process. Equally the Council and the
European Parliament shall decide upon the Commission proposal having regard to
the criteria set in Article 65 of the Staff Regulations respecting the rules
set in Annex XI with the exception of its Article 3(2).

(2)       The Court has confirmed
that the Commission has a margin of appraisal that should be based on Article
65 of the Staff Regulations, as regards the content of appropriate proposals.
The review of remuneration may, where appropriate, take into account other
factors, such as the human resources management and in particular the needs of
recruitment. Within this margin of appraisal, the Commission may base its
decision upon economic and social data such as the 2012 stagnation and the
ongoing crisis as well as the high level of unemployment rate and the high
level of public deficit and debt in the European Union. The Commission has
taken into account as well developments since 2011 such as the reform of the
Staff Regulations and especially the two years freeze imposed to EU officials
and the increase of weekly working time to 40h.

(3)       According to the data
supplied by Eurostat in agreement with the national statistical offices of the
Member States, national civil servants lost 1.1% of their purchasing power, the
same loss in purchasing power should have been applied to the EU officials and
other servants for the period 1 July 2012 – 30 June 2013 if the Commission
would have followed the normal application of the method. The Commission
considered however as appropriate to reduce the proposed adjustment to
remuneration and pensions in Belgium and Luxembourg to 0.9% instead of 1.7%
with regard to the economic crisis and the efforts already consented by EU
officials.

(4)       The same approach would
lead in 2011 to an adjustment of 0.9% instead of 1.7%. The total adjustment for
both years would be therefore 47% lower than under the normal application of
the method in force in 2011 and 2012.

(5)       The Commission has
proposed the above measures in order to involve the European Parliament in the
legislative procedure and to allow the co-legislators to decide on the
appropriate measures in accordance with Article 336 TFEU.

(6)       Under Article 65 of the
Staff Regulations the remuneration and pensions shall be updated before the end
of each year. In this regard, the urgent implementation of the Judgment of the
Court of Justice in Case C-63/12, issued on 19 November 2013, constitutes a due
reason for adopting this Regulation expediently.

HAVE ADOPTED THIS REGULATION:

Article 1

With effect from 1 July 2012, the date ‘1
July 2011’ in the second paragraph of Article 63 of the Staff Regulations shall
be replaced by ‘1 July 2012’.

Article 2

With effect from 1 July 2012, the table of
basic monthly salaries in Article 66 of the Staff Regulations applicable for
the purposes of calculating remuneration and pensions shall be replaced by the
following:

Article 3

With effect from 1 July 2012, the
correction coefficients applicable to the remuneration of officials and other
servants under Article 64 of the Staff Regulations shall be as indicated in
column 2 of the following table.

With effect from 1 January 2013, the
correction coefficients applicable under Article 17(3) of Annex VII to the
Staff Regulations to transfers by officials and other servants shall be as
indicated in column 3 of the following table.

With effect from 1 July 2012, the
correction coefficients applicable to pensions under Article 20(1) of Annex
XIII to the Staff Regulations shall be as indicated in column 4 of the
following table.

With effect from 16 May 2012, the
correction coefficients applicable to pensions under Article 20(1) of Annex
XIII to the Staff Regulations shall be as indicated in column 5 of the
following table. The effective date for the annual adjustment for those Member
States shall be 16 May 2012.

Article 4

With effect from 1 July 2012, the amount of
the parental leave allowance referred to in the second and third paragraphs of Article
42a of the Staff Regulations shall be EUR 928,22, and shall be EUR 1237,61
for single parents.

Article 5

With effect from 1 July 2012, the basic
amount of the household allowance referred to in Article 1(1) of Annex VII to
the Staff Regulations shall be EUR 173,60.

With effect from 1 July 2012, the amount of
the dependent child allowance referred to in Article 2(1) of Annex VII to the
Staff Regulations shall be EUR 379,34.

With effect from 1 July 2012, the amount of
the education allowance referred to in Article 3(1) of Annex VII to the Staff
Regulations shall be EUR 257,39.

With effect from 1 July 2012, the amount of
the education allowance referred to in Article 3(2) of Annex VII to the Staff
Regulations shall be EUR 92,67.

With effect from 1 July 2012, the minimum
amount of the expatriation allowance referred to in Article 69 of the Staff
Regulations and in the second subparagraph of Article 4(1) of Annex VII thereto
shall be EUR 514,53.

With effect from 1 July 2012, the
expatriation allowance referred to in Article 134 of the Conditions of
Employment of Other Servants shall be EUR 369,88.

Article 6

With effect from 1 January 2013, the
kilometric allowance referred to in Article 8(2) of Annex VII to the Staff
Regulations shall be adjusted as follows:

EUR 0 for every km from                   0
to 200 km

EUR 0,3858 for every km from          201
to 1 000 km

EUR 0,6430 for every km from          1
001 to 2 000 km

EUR 0,3858 for every km from          2
001 to 3 000 km

EUR 0,1284 for every km from          3
001 to 4 000 km

EUR 0,0620 for every km from          4
001 to 10 000 km

EUR 0 for every km over                   10 000
km.

To the above kilometric allowance a
flat-rate supplement shall be added, amounting to:

– 
EUR 192,91 if the distance by train between the
place of employment and the place of origin is between 725 km and 1 450 km;

– 
EUR 385,78 if the distance by train between the
place of employment and the place of origin is greater than 1 450 km.

Article 7

With effect from 1 July 2012, the daily
subsistence allowance referred to in Article 10(1) of Annex VII to the Staff
Regulations shall be:

– 
EUR 39,88 for an official who is entitled to the
household allowance;

– 
EUR 32,15 for an official who is not entitled to
the household allowance.

Article 8

With effect from 1 July 2012, the lower
limit for the installation allowance referred to in Article 24(3) of the
Conditions of Employment of Other Servants shall be:

– 
EUR 1135,15 for a servant who is entitled to the
household allowance;

– 
EUR 674,96 for a servant who is not entitled to
the household allowance.

Article 9

With effect from 1 July 2012, for the
unemployment allowance referred to in the second subparagraph of Article 28a(3)
of the Conditions of Employment of Other Servants, the lower limit shall be
EUR 1361,36, the upper limit shall be EUR 2722,75 and the standard
allowance shall be EUR 1237,61.

Article 10

With effect from 1 July 2012, the table of
basic monthly salaries in Article 93 of the Conditions of Employment of Other Servants
shall be replaced by the following:

Article 11

With effect from 1 July 2012, the lower
limit for the installation allowance referred to in Article 94 of the
Conditions of Employment of Other Servants shall be:

– 
EUR 853,83 for a servant who is entitled to the
household allowance;

– 
EUR 506,21 for a servant who is not entitled to
the household allowance.

Article 12

With effect from 1 July 2012, for the
unemployment allowance referred to in the second subparagraph of Article 96(3)
of the Conditions of Employment of Other Servants, the lower limit shall be
EUR 1021,04, the upper limit shall be EUR 2042,04 and the standard
allowance shall be EUR 928,22.

With effect from 1 July 2012, for the
unemployment allowance referred to in Article 136 of the Conditions of
Employment of Other Servants, the lower limit shall be EUR 898,28 and the upper
limit shall be EUR 2113,60.

Article 13

With effect from 1 July 2012, the
allowances for shiftwork laid down in the first subparagraph of Article 1(1) of
Council Regulation (ECSC, EEC, Euratom) No 300/76[1] shall be EUR 389,08,
EUR 587,27, EUR 642,10 and EUR 875,39.

Article 14

With effect from 1 July 2012, the amounts referred
to in Article 4 of Council Regulation (EEC, Euratom, ECSC) No 260/68[2] shall be subject to a coefficient
of 5,616515.

Article 15

With effect from 1 July 2012, the table in
Article 8(2) of Annex XIII to the Staff Regulations shall be replaced by the
following:

Article 16

With effect from 1 July 2012, for the
application of Article 18(1) of Annex XIII to the Staff Regulations, the amount
of the fixed allowance mentioned in the former Article 4a of Annex VII to the
Staff Regulations in force before 1 May 2004 shall be:

- EUR 134,23 per month for officials
in Grade C4 or C5;

- EUR 205,80 per month for officials
in Grade C1, C2 or C3.

Article 17

With effect from 1 July 2012, the scale for
basic monthly salaries in Article 133 of the Conditions of Employment of Other
Servants shall be replaced by the following:

Article 18

This Regulation shall enter into force on
the day following that of its publication in the Official Journal of the
European Union.

This Regulation shall be binding
in its entirety and directly applicable in all Member States.

Done at Strasbourg,

For the European Parliament                        For
the Council

The President                                                 The
President

LEGISLATIVE FINANCIAL STATEMENT
FOR PROPOSALS

1.           FRAMEWORK OF THE
PROPOSAL/INITIATIVE

1.1.        Title of the
proposal/initiative

Proposal for a Council Regulation adjusting with effect from 1 July
2012 the remuneration and pensions of officials and other servants of the
European Union and the correction coefficients applied thereto

1.2.        Policy area(s) concerned
in the ABM/ABB structure[3]

All areas and activities are potentially concerned.

1.3.        Grounds for the
proposal/initiative

1.3.1.     Requirement(s) to be met in
the short or long term

To ensure that the purchasing power of EU civil servants’
remuneration and pensions develops in parallel with the changes in the
purchasing power of civil servants of central government in the Member States.

1.4.        Duration and financial
impact

ý Proposal/initiative of unlimited
duration

– 
Implementation with a start-up period from 1 January
2014,

– 
followed by full-scale operation.

1.5.        Management mode(s)
envisaged[4]

ý Centralised direct management by the Commission: PMO

2.           ESTIMATED FINANCIAL
IMPACT OF THE PROPOSAL/INITIATIVE

2.1.        Heading(s) of the
multiannual financial framework and expenditure budget line(s) affected

· The proposal has a financial impact on all budgetary lines relating
to staff expenditure in all Institutions and Agencies, i.e. it concerns expenditure
for salaries of staff in headquarters and in delegations, contract agents,
staff in the administrative offices, Members, parliamentary assistants,
research staff, staff financed under BA-lines, staff paid under the provisions
of early termination of service, pensions.

In order of
multiannual financial framework headings and budget lines.

Heading of multiannual financial framework || Budget line || Type of expenditure || Contribution

Number [Description........................................] || DA/NDA ([5]) || from EFTA[6] countries || from candidate countries[7] || from third countries || within the meaning of Article 18(1)(aa) of the Financial Regulation

|| XX.01.01.01 and Chapter 11, Chapter 42 Expenditure Relating to Parliamentary Assistants || DNA || NO || NO || NO || NO

2.2.        Estimated impact on expenditure

2.2.1.     Summary of estimated impact
on expenditure

EUR million (to 3 decimal places)

Heading of multiannual financial framework: || Number || XX.01.01.01 and Chapter 11, Chapter 42 Expenditure Relating to Parliamentary Assistants

Heading of multiannual financial framework: || 5 || " Administrative expenditure"

EUR million (to 3 decimal places)

|| || || Year 2013 || Year 2014 || Year 2015 || Year 2016 || Subsequent years || TOTAL

TOTAL appropriations under HEADING 5 of the multiannual financial framework || (Total commitments = Total payments) || 79.7 || 53.2 || 53.2 || 53.2 || 53.2 || 53.2 || 53.2 || Not available

EUR million (to 3 decimal places)

|| || || Year 2013 || Year 2014 || Year 2015 || Year 2016 || Subsequent years || TOTAL

TOTAL appropriations under HEADINGS 1 to 5 of the multiannual financial framework || Commitments || 79.7 || 53.2 || 53.2 || 53.2 || 53.2 || 53.2 || 53.2 || Not available

Payments || 79.7 || 53.2 || 53.2 || 53.2 || 53.2 || 53.2 || 53.2 || Not available

2.2.2.     Estimated impact on
operational appropriations

– 
ý  The proposal/initiative does not require the use of operational
appropriations

2.2.3.     Estimated impact on
appropriations of an administrative nature

2.2.3.1.  Summary

– 
ý  The proposal/initiative does not require the use of administrative
appropriations

2.2.3.2.  Estimated requirements of
human resources

– 
ý  The proposal/initiative does not require the use of human
resources

2.2.4.     Compatibility with the
current multiannual financial framework

– 
ý  Proposal/initiative is compatible the current multiannual
financial framework.

2.2.5.     Third-party contributions

– 
The proposal/initiative does not provide for
co-financing by third parties

2.3.        Estimated impact on
revenue

– 
 ̈  Proposal/initiative has no financial impact on revenue.

– 
ý  Proposal/initiative has the following financial impact:

– 
 ̈         on own resources

– 
ý         on miscellaneous revenue

EUR million (to 3 decimal places)

Budget revenue line: || Appropriations available for the ongoing budget exercise || ||

Year 2013 || Year 2014 || Year 2015 || Year 2016 || Subsequent years

Article 410 Pension contribution || 437.7 || 6.4 || 4.3 || 4.3 || 4.3 || 4.3 || 4.3 || 4.3

Article 400 Tax || 591.7 || 8.6 || 5.7 || 5.7 || 5.7 || 5.7 || 5.7 || 5.7

Article 410 Special levy || 60.1 || 0.3 || 0.7 || 0.7 || 0.7 || 0.7 || 0.7 || 0.7

Specify the method for
calculating the impact on revenue.

The impact on revenue is calculated on the basis of the payment of
remuneration and pensions for the month of July and applying the effect of the
adjustment.

[1]                      Council Regulation (ECSC, EEC, Euratom) No 300/76 of 9 February 1976
determining the categories of officials entitled to allowances for shiftwork,
and the rates and conditions thereof (OJ L 38, 13.2.1976, p. 1). Regulation as supplemented by Regulation
(Euratom, ECSC, EEC) No 1307/87 (OJ L 124, 13.5.1987, p. 6).

[2]                      Regulation (EEC, Euratom, ECSC) No 260/68 of the Council of 29
February 1968 laying down the conditions and procedure for applying the tax for
the benefit of the European Communities (OJ L 56, 4.3.1968, p. 8).

[3]               ABM:
Activity-Based Management – ABB: Activity-Based Budgeting.

[4]               Details
of management modes and references to the Financial Regulation may be found on
the BudgWeb site: http://www.cc.cec/budg/man/budgmanag/budgmanag_en.html

[5]               DA=
Differentiated appropriations / DNA= Non-Differentiated Appropriations

[6]               EFTA:
European Free Trade Association.

[7]               Candidate
countries and, where applicable, potential candidate countries from the Western
Balkans.