61980C0127
OPINION OF MR ADVOCATE GENERAL CAPOTORTI
DELIVERED ON 14 JANUARY 1982 (
1
)
Mr President,
Members of the Court,
1.
The three cases which form the subject-matter of my opinion today arise from actions brought by former Community officials in response to the unfavourable impact on their respective pensions of Council Regulations (EEC) Nos 3085/78 and 3086/78 of 21 December 1978. I would recall that those regulations have amended the monetar)' parities to be used in applying the Staff Regulations and the weightings inherent in the salaries and pensions of officials and other servants of the Communities. This has, amongst other things, had adverse effects on the level of some pensions and particularly on those paid in Belgian francs to officials who have settled in Member States with a weak currency.
I will briefly summarize the course of the proceedings in each of the three cases.
(a)
Case 127/80. Mr Vincent Grogan was employed by the Commission as an official, with the status of Director, from 16 November 1973 to 31 March 1975. By decision of the appointing authority of 25 March 1975 he was retired from the service under Article 50 of the Staff Regulations of Officials. Consequently, he received payment of his pension after obtaining the allowance governed by Annex IV to the Staff Regulations. He then elected, under the third paragraph of Article 45 of Annex VIII to the Staff Regulations to have his pension paid in the currency of the country in which the institution to which he belonged has its seat (Belgian francs) and declared that he intended to settle in Ireland.
By memorandum of 23 October 1979, the Commission informed him that pursuant to Article 4 of Regulation No 3085/78, the amount of the pension to which he was entitled would be reduced from BFR 30145 to BFR 13080 per month. That reduction would be implemented progressively over a period of ten months and would become fully operative as from July 1980. Mr Grogan consequently lodged an official complaint and, after the Commission had failed to adopt a decision within the period of four months prescribed by Article 90 of the Staff Regulations, he brought an action before this Court, by a document lodged at the Registry on 27 March 1980. The applicant seeks the annulment of the implied decision rejecting his complaint and a declaration that Council Regulations (EEC) Nos 3085/78 and 3086/78 do not apply to him.
(b)
Case 164/80. Mr Luigi De Pascale, formerly a Commission official, settled in Italy after retiring and elected to have his pension paid in the currency of the country in which the institution employing him has its seat, in other words, in Belgian francs. By letter of 19 October 1979, following upon circulars similar in content but more general in scope, such as that of 12 July 1979, the Commission informed him that, on the basis of Regulation (EEC) No 3085/78, the amount of the pension to which he was entitled would be reduced from BFR 72850 to BFR 34910 as a result of progressive reductions to be implemented between October 1979 and July 1980. Mr De Pascale then lodged an official complaint, claiming that Regulations (EEC) Nos 3085/78 and 3086/78 should not be applied to him, that he should therefore be paid the same pension as he received before those regulations came into force and that, in any event, all appropriate measures should be taken to ensure that he did not suffer any loss. In the absence of any response from the administration, after the expiry of the four-month period prescribed by the Staff Regulations, Mr De Pascale instituted proceedings against the Commission by a document lodged on 14 Julv 1980. He has asked that Regulations'(EEC) Nos 3085/78 and 3086/78 should be declared not applicable to his case, that the decisions whereby his monthly pension was progressively reduced should be annulled and that the defendant should be ordered to pay him, by way of compensation, the amounts withheld from him since October 1979.
(c)
Case 167/80. I have already had occasion to deal with the course of these proceedings in mv opinion of 14 Mav 1981 (in Case 153/79 and others [1981] ECR 2111). Therefore I will confine myself to recalling that Mr Dunstan Curtis, formerly an official of the European Parliament, residing in the United Kingdom, instituted proceedings on 18 July 1980 against the Commission and the European Parliament primarily for a declaration that Regulations (EEC) Nos 3085. 78 and 3086/78 should not be applied to mm on the ground thai they are unlawful and, alternatively, for the annulment of both the Commission's communication of 22 October 1979 informing him that, as from that month, and in ten stages, the amount of his pension would be progressivelv reduced from BFR 19351 to BFR 8398, and the (implied) decisions rejecting the two complaints lodged by him against the aforesaid communication and against the Commission's earlier letter-circular of 12 lulv 1979. Bv judgment of 4 June 1981 ([1981] ECR 1499) the Court ruled that the application against the Commission was inadmissible but held the application against the Parliament to be admissible. Now it is necessary to consider the substantive aspects of the case.
2.
In my opinion of 14 May 1981, I analvsed the various problems stemming from Regulations (EEC) Nos 3085/78 and 308Ó/78. I would therefore refer to that analysis as regards the legislative background against which these disputes, amongst others, are to be viewed. I propose to consider in this opinion only the provisions which are directly or indirectly concerned with the pension scheme.
It should be recalled at the outset that on the basis of the third paragraph of Article 45 of Annex VII to the Staff Regulations of Officials, “beneficiaries may elect to have their pensions paid in the currency either of their country of origin or their country of residence or of the country where the institution to which the official belonged has its seat; their choice shall remain operative for at least two years”. That provision must be read in conjunction with the second subparagraph of Article 82 (1) of the Staff Regulations which lays down that pensions “shall be weighted in the manner provided for in Article 64 and Article 65 (2) for the country of tht Communities where the person entitled to the pension declares his home to be” (emphasis added). It should be added that the first paragraph of Article 64 lays down that “an official's remuneration expressed in Belgian francs shall ... be weighted at a rate above, below or equal to 100%, depending on living conditions in the various places of employment” and the weighting applicable to the remuneration of officiais employed at the provisional seats of the Communities (Brussels or Luxembourg) was equal to 100% (as at 1 January 1962). Article 65 (2) lays down that “in the event of a substantial change in the cost of living, the Council shall decide ... what adjustments should be made to the weightings and if appropriate to apply them retrospectively”. The Court has had occasion to explain that the weighting referred to in Article 64 is aimed at ensuring that all officials enjoy the same purchasing power, irrespective of their place of employment, whereas the weighting provided for by Article 65 is a means of adjusting the remuneration of ali officiais, utilized to bring their salaries in line with changes in the cost of living (judgment of 13 Julv 1978 in Case 114/77 Jacquemart [1978] ECR 1697 and judgment of 19 November 1981 in Case 194/80 Benassi [ECR] 1981 2815).
The second subparagraph of Article 82 (1) lays down (infine) that “payment of such pensions shall be effected in accordance with the terms contained in Article 63 in respect of payment of remunerations”. It should be borne in mind that Article 63, as it stood before the adoption of Regulation (EEC) No 3085/78, laid down that since remuneration was expressed in Belgian francs, payments made in a currency other than Belgian francs were to be calculated on the basis of the exchange rates accepted by the International Monetary Fund, which were those in force on 1 January 1965. Those rates were quite different from current rates. One need only recall that the ratio between the lira and the Belgian franc was 1 to 12 (today it is approximately 1 to 32). To prevent those exchange rates from having adverse repercussions on the amount of the pensions paid in currencies other than Belgian francs and greatly weakened by devaluation, the Council resorted to the expedient of fixing high weightings for countries with a weak currency. Thus a retired official intending to settle in Italy and wishing to be paid in the currency of the place of residence, that is to say in lire, could offset the effects of an unfavourable exchange rate by means of a weighting considerably in excess of 100. Such a weighting was however anomalous and distorted in the sense that, in order to correct the effects of the no longer realistic parities of the International Monetary Fund imposed by Article 63, it reversed the function of the weightings by geographical area provided for by Article 64. In other words, in those Member States with a lower cost of living, the weighting was above that fixed for the other countries with a higher cost of living. Despite that, in cases where pensioners stated not only that they wished to settle in a Member State with a weak currency but also that they wished to be paid in the currency of that country, the result obtained by the improper use of the weighting was possible because the latter was designed to achieve equalization between their pensions and those of retired officials residing in Member States with a strong currency and paid in that currency.
However, there was another alternative which was more widely adopted. The pensioner could elect, pursuant to the third paragraph of Article 45 of Annex VIII, to be paid in the currency of the country where the institution to which he belonged has its seat and declare at the same time, pursuant to Article 82 (1) of the Staff Regulations, that he wished to settle in a country with a high rate of inflation (for example, Italy, the United Kingdom or Ireland). In such a case, by being paid in a strong currency, the pensioner avoided the adverse effects of the superseded parities of the International Monetary Fund and, in addition, a weighting above 100 was applied to him, on the basis of his chosen place of residence, with the result that he obtained further increment to his pension. The outcome was that a pensioner who settled in Italy or in the United Kingdom could receive a pension which, in real terms, was 50% higher than that of a colleague who was entitled to the same basic pension but had declared that he intended to settle in Belgium or in Luxembourg.
That highly anomalous situation, resulting from a set of provisions which permitted some pensioners to derive considerable benefits by comparison with others, came to an end with the entry into force of Regulations (EEC) Nos 3085/78 and 3086/78. The first regulation replaced, as we know, the old International Monetary Fund parities with the exchange rates used for the implementation of the general budget of the European Communities, by amending the second paragraph of Article 63 of the Staff Regulations of Officials accordingly as regards remuneration paid in a currency other than Belgian francs (and as regards pensions, in view of the reference in Anide 82 (1)). At the same time. Regulation (EEC) No 3086/78 amended the weightings by geographical area in line with the reasoning on which Article 64 of the Staff Regulations is based and therefore fixed weightings above 100 for countries with a higher cost of living than Belgium and Luxembourg and below 100 for countries with a lower cost of living. Of course, the new system has led to an appreciable reduction in the pensions of those who derived the advantages described above under the previous svstem. In order to soften the impact of that reduction, Article 4 of Regulation (EEC) No 3085/78 provided thai “for pensions and allowances of which the net amount becomes less than that under the existing arrangements”, the new scheme should “only apply from October 1979” and that, in addition, “from that date the difference between the net amounts resulting from the implementation of this regulation and those received in September 1979” was to be “reduced by one tenth per month”.
3.
There can be no doubt that the three cases in question, 117/80, 164/S0 and 167/80 may be considered together so far as their substance is concerned because, by challenging the individual implementing measures, all the applicants raise in essence the question whether Regulations (EEC) Nos 3085/76 and 3086/78 are applicable to them. I would add that objections levelled against those regulations by Mr Grogan, Mr De Pascale and Mr Curtis are largely the same. According to the applicants, the provisions on the basis of which their respective pensions have been paid at a reduced rate, as from October 1979, are invalid on several grounds, in particular:
(a)
infringement of essential procedural requirements;
(b)
infringement of various general principles (or alleged general principles) of Community law (the principle of the inviolability of vested rights, the principle of legitimate expectation, the principle of equality, the principle that the pensions to which Community officials are entitled may not be reduced, and finally the principle that the administration is obliged to observe the fundamental conditions of the employment relationship),
(c)
misuse of powers, and
(d)
infringement of certain provisions of the Staff Regulations.
4.
The infringement of essential procedural requirements occurred, according to the applicants, in two ways: the procedure for the adoption of the regulations in question was unlawful (in particular, for failure to consult the European Parliament, the Court of Justice, the Economic and Social Committee, the Court of Auditors, the Staff Regulations Committee and the Staff Committee) and the statement of the reasons on which the regulations were based was inadequate. I have already examined those objections in my opinion of 14 May 1981, to which I have already referred, and I expressed the view that the procedure for the adoption of the two regulations was quite lawful. It should be said, however, that at the time 1 had taken account of the provisions in question because of their effect on the cost of transfers by Community officials of pan of their remuneration to other countries. Therefore I should now reconsider the alleged formal defects referred to above, particularly in the light of the amendments made to the pension scheme.
A —
As regards the failure to consult the European Parliament, I would point out to begin with that consultation was mandatory onlv ir the case of Regulation (EEC)' No 3085/78 which amended two provisions of the Staff Regulations, namely Article 62 and Article 17 of Annex VII. In accordance with Article 24 of the Treaty establishing a Single Council and a Single Commission of the European Communities and having regard to the second paragraph of Article 10 of the Staff Regulations, the European Parliament must be consulted on any proposal for the revision of the Staff Regulations. However, there was no need to consult the Parliament in the case of Regulation (EEC) No 3086/78 since it merely laid down measures to give effect to certain provisions of the Staff Regulations, in particular those relating to weightings.
On what argument is the contention based that the Parliament was not consulted? The applicants (and in particular Counsel for Mr De Pascale) argue in the first place that the proposal to amend the Staff Regulations which was submitted to the Parliament was substantially different from the text subsequently adopted on 21 December 1978, that is to say the proposal submitted by the Commission to the Council on 1 April 1977 (see Official Journal C 99, 22 April 1977, p. 5) for a Council Regulation introducing the European unit of account into.the Staff Regulations of Officials and the Conditions of Employment of Other Servants of the European Communities. In their opinion, the new proposal submitted in 1978 should have been the subject of a separate consultation. On this point, I should like to refer to the views which I expressed in my opinion of 14 May 1981 (paragraph 20) and to repeat that the technical solution evolved by Regulation No 3085/78, consisting in the adoption for the payment of salaries and pensions to officials of the exchange rates used for the Community budget instead of the European unit of account has not altered in economic terms the arrangements for the payment of pensions in a currency other than Belgian francs. In other words, the same adverse impact produced by the new parities (accompanied by new weightings) on the levels of certain pensions would have occurred even if the European unit of account had been introduced.
The applicants (and in particular Counsel for Mr Curtis) state in addition that the Commission provided the Parliament with insufficient and misleading information when, in 1977, it transmitted to the latter its initial proposal for the amendment of the Staff Regulations with the assurance that its new system of exchange rates would not entail reductions in the financial treatment of officials.
In general terms, I would observe that the Commission, merely by submitting its proposals for legislative measures to the Parliament, enables the latter to carry out its advisor)' function. Accordingly, I believe it is necessary to dismiss the idea that the explanations provided by the Commission and its projections concerning the effects and the implications of a given proposal (or the absence of sufficient explanations or projections) may play such a predominant role as to deprive the Parliament of the opportunity to express a valid opinion on the text before it. Evidently, it is for the institution consulted to assess the effects of a legislative measure on the basis of the proposal transmitted to it. If it fails to anticipate certain consequences, such failure can in no way constitute a procedural defect. It should be remembered, furthermore, that the Parliament possesses the technical means for investigating the scope and the repercussions of the proposals on which it is called upon to give its opinion. Rule 39 (4)of the European Parliament's Rules of Procedure lays down, in the text adopted on 12 March 1979, that “any committee may, with the agreement of the Bureau of Parliament, instruct one or more of its members to proceed on a study or fact-finding mission” and Rule 40 (2) provides that in addition to the Commission and the Council, any other person (obviously experts) may be invited to attend and to speak at a meeting.
Having clarified that preliminary matter, I believe it would be useful to examine the applicant's contention, referred to above, in order to determine whether it is correct: in other words, whether, and if so, how far, the Commission misled the Parliament as regards the effects of its proposal on which Regulation No 3085/78 is based to the extent of preventing it from realizing that in the case of some pensioners, that proposal would have serious adverse consequences.
Two facts are beyond dispute. First, Commissioner Tugendhat's failure to refer to the problem in question when the proposal for Regulation No 3085/78 was the subject of a parliamentary debate. At the sitting on 7 July 1977, he pointed out that the aim of the new svstem was to achieve “financial neutralitv” (Supplement to the Official Journal, ‘No 219, July 1977, Repon of the Proceedings from 4 to 8 July 1977, p. 3C3) without referring to the effects of that svstem on the level of pensions and, in particular, on the position of pensioners residing in Member States with a weak currency who had asked for their pensions to be paid in Belgian francs. Secondly, the assurances given by the Commission that its proposal would in no way prejudice officials and other servams as regards the true value of their salaries, pensions and allowances. Those assurances ’ were referred to by Mr Cointat in the repon submitted by him on behalf of the Committee on Budgets (Doc. 218/77 of 7 July 1977, EP 41.101/def, point 13), and in the preamble to the Resolution in which the European Parliament expressed its opinion on the Commission's proposal (Official Journal C 183, 1 August 1977, p. 55, fifth recital).
Other circumstances show, however, that the effects of the new system on the level of a certain category of pensions were brought to the Parliament's attention. Mr Cointat's report is supplemented by Annex I which contains a table illustrating a “Comparison between pensions calculated in accordance with the provisions of the Staff Regulations in force (in 1977) and in accordance with the proposal for a regulation of the Council COM(77)43/def.”. That table examines the position of retired officials residing in countries with a weak currency who have elected, pursuant to Article 45 of Annex VIII to the Staff Regulations, to have their pensions paid in the currency of the country of residence and explains that as far as they are concerned the new system would not lead to a reduction in pensions. However, paragraph (b) of the accompanying explanatory notes states that “there will no longer be any advantage to be gained from opting, pursuant to Article 45 of Annex VIII to the Staff Regulations, for payment [of pensions] in currencies other than that of the country of residence”. The adverse effects of the new system on the level of pensions awarded to retired officials residing in countries with a high rate of inflation who elected to receive payment in Belgian francs were thus pointed out by the rapponeur of the Committee on Budgets. It is appropriate to add that the Parliament was well aware of the parallel adjustment of the geographical weightings and of the repercussions which it would have. Mr Cointat in fact explains at point 10 of his repon that weightings should be adjusted in such a way as to serve, “in accordance with the original intention, as a factor which takes into account increases in the cost of living and not as a factor to correct exchange parities”. The same concepts were subsequently incorporated in the European Parliament's abovementioned resolution. The fourth recital of that resolution in fact states inter alia that “following the introduction of the European unit of account, weightings will no longer be required to correct exchange parities and will hencefonh be used principally to take account of increases in the cost of living, as originally intended”.
In my opinion, certain passages in the statement made by Mr Lange in the parliamentary debate in question are also significant. In commenting on the information supplied by the Commission concerning the implications of the proposal to amend the method of calculating salaries and pensions, he referred to the “tables which illustrate the amounts paid to former officials in the same grade”, set out on page 13 (pensions table) and on page 14 (table on voluntary termination of service) of the Cointat repon, and pointed out that the new amounts took account of the differences in purchasing power between the various currencies (see the aforesaid minutes of the proceedings of the European Parliament from 4 to 8 July 1977, p. 302) and he also alluded to the distortions made possible by the previous system when he stated “... manipulations of the kind which took place in the past when units of account were still based on the 1965 rate, are no longer possible ...; at the time curious manipulations of the various currencies took place with consequences which were not particularly desirable”.
Finally, I should like to state that the absence of a debate in depth on that particular aspect of the reform is not surprising. To begin with, the new svstem was genuinely neutral in the case of a large number of pensions, namely those paid in Belgian francs to pensioners residing in Belgium or in Luxembourg or in other Member States with a strong currency and all pensions paid in local currency to pensioners residing in countries other than Belgium or Luxembourg. In spite of the adjustment of the parities and weightings, pensioners within those categories have received the same pension, in terms of purchasing power, which they were paid before the entry into force of the new system. Secondly, the previous system which permitted pensioners residing in countries with a high rate of inflation to obtain pensions which were far higher than those paid to pensioners residing in Belgium or in Luxembourg was manifestly an absurdity, the lawfulness of which (at least as far as observance of the principle of equality is concerned) is open to serious doubts.
B —
Counsel for Mr Curtis has alleged that the failure to consult the Court of Justice constituted a defect. That criticism is based on the idea that the Court was consulted on a proposal for a regulation which was substantially different from the text adopted in 1978 and that consequently fresh consultation was essential. That grievance does not differ from the one similar in content raised in connection with the consultation of the European Parliament. 1 will therefore confine myself to repeating that were no differences between the proposal submitted to the competent institutions for their opinion in 1977 and the one adopted in 1978 such as to necessitate a repetition of the consultation procedure.
C —
The applicants (and in particular Counsel for Mr Curtis and for Mr De Pascale) maintain that Regulation (EEC) No 3085/78 has also been vitiated by the failure to consult the Economic and Social Committee and the Court of Auditors. They rely on Article 24 of the Merger Treaty which provides that “the Council shall, acting by a qualified majority on a proposal from the Commission and after consulting the other institutions concerned, lay down the Staff Regulations of Officials ... and the Conditions of Employment of Other Servants ...” (emphasis added). The reference to the “other institutions concerned” which are to be consulted before any rules of the Staff Regulations are laid down or amended includes, according to the applicants, the Economic and Social Committee and the Court of Auditors.
I cannot share that view. In my opinion of 14 May 1981, I have already criticized and rejected the argument that the word “institutions”, which in the Treaties establishing the Communities is used exclusively to refer to the Council, the Commission, the Parliament and the Coim of Justice, was in this case meant to indicate all the bodies which employ staff within the framework of the Communities. I explained that “such an interpretation would do violence to the letter of the provision and is justified neither by consideration of the Treaties as a whole nor by reference to the objectives of the said Article 24” and I added that I considered it reasonable that only the Community institutions stricto sensu should be endowed with a role of particular importance in the adoption and amendment of the Staff Regulations. I should like to confirm that opinion in the present cases also because the parties have not adduced any arguments which might induce me to revise the views which I expressed at the time.
Counsel for Mr De Pascale has endeavoured to rely on the adjective “concerned” accompanying the noun “institutions”. All the institutions which employ staff should be regarded as “concerned” in the context of Article 24. Therefore, since the Economic and Social Committee and the Court of Auditors also employ their own staff they should be treated on an equal footing with the institutions stricto sensu which are designated as such in the Treaties. That argument is, in my opinion, untenable. It has the drawback of attributing excessive importance to the adjective “concerned”, going so far as to assume that a given interpretation of the word makes it possible to nullify the technical significance of the word “institutions” which can be deduced from the text of the Treaties. Instead, it seems to me that, referring to consultation of the institutions concerned, Article 24 has taken into account cases of provisions in the Staff Regulations the scope of which is limited to one or only some of the institutions. That is illustrated by the provisions of Title VIII of the Staff Regulations (“Special provisions applicable to officials in the scientific or technical sen-ices of the Communities”). That title, as is explained in the first paragraph of Article 92, contains “the special provisions applicable to officials of the Communities who occupy posts in the field of nuclear science calling for scientific or technical qualifications and who are paid from appropriations in the research and investment budget”. Clearly, any amendment of the provisions of that title could not be of any concern to the Court of Justice which does not employ for the exercise of its institutional powers technical staff within the category described. Consequently, there is no need to consult the Court on the basis of Article 24 in the case of proposals to amend the Staff Regulations which relate to the aforesaid provisions. The expression “institutions concerned” is therefore capable of being interpreted in accordance with the criterion that, with respect to certain provisions of the Staff Regulations, the number of institutions to be consulted in the event of amendment may be limited. That interpretation strikes me as greatly to be preferred because it has the advantage of not interfering with the technical significance of the word “institutions” in the context of the Treaties and at the same time of observing the literal significance of the word “concerned”, regard being had to the fact that the interest of each institution in being consulted depends on the content of the provisions to be amended.
Counsel for Mr De Pascale has relied upon another argument, pointing out that in the Act concerning the Conditions of Accession of the Kingdom of Denmark, Ireland and the United Kingdom of Great Britain and Nonhern Ireland to the European Communities and the Adjustments to the Treaties, Pan Two of Title I (“Provisions governing the institutions”) lays down rules on adjustments to the Treaties by reference to the four institutions stricto sensu as well as to other bodies, namely the Economic and Social Committee, the ECSC Consultative Committee and the Scientific and Technical Committee. That is said to demonstrate that, as far as primary provisions are concerned — for the provisions of the Act of Accession in addition to those of the Treaties establishing the Communities fall within that category — the Economic and Social Committee is regarded as an “institution”.
However, that argument does not stand up to critical assessment. In the first place, the heading “Provisions governing the institutions” does not necessarily mean provisions relating to the institutions. It is more reasonable to interpret it as meaning provisions relating to institutional aspects, that is to say, the organizational structures of the Communities. The correction of this interpretation is confirmed by the fact that Title I itself also contains, as we have seen, provisions relating to the ECSC Consultative Committee and to the Scientific and Technical Committee. It is quite excessive to take the view that those two committees, which have a limited and specific role in the Community organization, can be described as “institutions” in the same way as the Commission, the Parliament, the Council and the Court of Justice.
Secondly, it is necessary to recall the recent amendment of Article 1 of the Staff Regulations bv Council Regulation (EEC) No 1376/77 of 21 June 1977, consisting in the addition of a second paragraph which lays down that “save as otherwise provided for, the Economic and Social Committee and the Court of Auditors shall, for the purpose of these Staff Regulations, be treated as institutions of the Communities” (emphasis added). As I observed in my opinion of 14 May 1981, that demonstrates that “when the Community legislature intended certain bodies to be treated as Community institutions, it did so by recourse to express provisions and confined the effects of those provisions to a particular legislative context”. It follows, in the absence of specific provisions, that when the primar) or secondary sources of law speak of “institutions” they refer to the bodies considered as such by the Treaties.
In my opinion, therefore, the failure to consult the Economic and Social Committee and the Court of Auditors does not affect the validity of Regulation (EEC) No 3085/78.
D —
As regards the failure to consult the Staff Regulations Committee, which Counsel for Mr De Pascale complains of in general terms, I would recall that the second paragraph of Article 1C of the Staff Regulations provides that that committee (consisting of representatives of the institutions of the Communities and representatives of their Staff Committees) “shall be consulted by the Commission on any proposal for the revision of the Staff Regulations”. Thai rule should undoubtedly have been to be applied to Regulation (EEC) No 3085/78 which has as its subject-matter & number of amendments to the Staff Regulations. Indeed, in the preamble to the regulation it is formally noted that the opinion in question has been gnen The applicants object that the subicn matter of that opinion was a propova. tor amendment substantially different from the text adopted in December Fresh consultation should therefore ha f taken place on the latter text. Thr umr argument has been advanced in rr.aiiv to the alleged failure to consult thr I a liament and the Court of Justice. I i uM therefore refer to the observation nur I made when I considered those t o issues.
The legal position is different in the case of Regulation (EEC) No 3086/78. In my opinion of 14 May I have already stated that the function of that regulation “is to implement the provisions of the Staff Regulations on weightings... [and] therefore in the hierarchy of the sources of Community law it occupies a subordinate position in relation to the Staff Regulations”. In those circumstances, it was unnecessary to consult the Staff Regulations Committee. We have seen that Article 10 of the Staff Regulations concerns exclusively proposals for the revision of the Staff Regulations. I observed, in my opinion of 14 May, that the obligation to consult the Staff Regulations Committee could not even be inferred from Article 110 of the Staff Regulations which provides that “the general provisions for giving effect...” (to the Staff Regulations) “shall be adopted by each institution after consulting its Staff Committee and the Staff Regulations Committee provided for in Article 10”. At the time, I pointed out that “Article 110 refers to the general provisions which it falls to each institution to adopt in order to give effect to the Staff Regulations... whereas [the] regulation ... contains provisions which are intended to be applied in the same way in relation to the staff of all the institutions”. I have not changed my mind and therefore I do not consider it necessary to devote any more time to this issue.
E —
As regards the failure to consult the Staff Committee, another alleged defect which Counsel for Mr De Pascale complains of, it is again necessary to turn to Article 110 of the Staff Regulations which requires that committee to be consulted before the adoption of those general implementing measures which every institution must take in its own area of responsibility. However, there is no legal basis for stating that such consultation is necessary in the case of Regulations (EEC) Nos 3085 and 3086. The former contains provisions amending the Staff Regulations while the latter contains implementing provisions intended to be applied in the same wav to the members of staff of all the institutions.
F —
Counsel for Mr Curtis contends that essential procedural requirements have also been infringed as a result of the absence of a sufficient statement of the reasons upon which Regulations (EEC) Nos 3085/78 and 3086/78 are based. That objection strikes me as being as unfounded as the previous ones. In the second recital of the preamble to Regulation (EEC) No 3085/78 it is stated that “it has become necessary to amend the provisions of the Staff Regulations concerning the monetary parities used in application of the Staff Regulations”. That statement, though concise, is in mv opinion sufficient for the purposes of compliance with the obligation to state the reasons on which a measure is based, laid down by Article 190 of the EEC Treaty, especially because, as I have already observed in my opinion of 14 May 1981, it must be viewed in relation to the opinions expressed by the institutions consulted, which are referred to in the preamble. As far as Regulation (EEC) No 3086/78 is concerned, the reasons on which it is based strike me as being equally sufficient. I would repeat in that connection the observation which I made in my earlier opinion, namely that “its sole recital refers to the amendment made to the provisions of the Staff Regulations concerning monetary parities and the resultant need to adjust the weightings applicable to salaries and pensions”.
5.
Now it is time to consider the alleged infringements of general principles which are said to vitiate Regulations (EEC) Nos 3085/78 and 3086/78. The applicants contend in the first place that there has been an infringement of the principle that vested rights must be respected — to the detriment of all those retired officials who, under the former system, declared that they were residing in a country with a weak currency and at the same time asked for their pension to be paid in Belgian francs — because from that principle they derive their right to be paid the same amount as that which they received until the entry into force of the new system. In other words, they assume that at the time when the procedures for payment were changed, they had already definitively acquired the right to receive a pension of the same amount as that paid to them until that date and which the administration was not empowered to reduce.
In my opinion of 14 May 1981 (paragraph 24) I have already discussed the concept of vested rights and the manner in which it has been interpreted in the case-law of this Court. I will therefore confine myself to recalling brieflv that for vested rights to come into being, the circumstances giving rise to the right must arise unde a provision which was already in force before the amendments introduced by the Communitv authorities. It follows thai those authorities may not amend the Staff Regulations retroactively to the detriment of officials and former officials but it certainly does not imply thai they mav not amend the legal and economic system governing officials and retired officials in a way that would be prejudicial to them for the future. It is bevond dispute, in my opinion, that the reuulations in question relate only to the future and the circumstances giving rise to a former official's right to be paid a specific amount every month, by way of pension, arise when each monthly payment falls due and thus come within the scope of the provisions in force at the time.
Counsel for Mr Grogan relies on the contention that the right to be paid a pension rests on a contractual basis, arguing that an agreement was concluded between the administration and the officials in its employment on which the rules governing the pension scheme are founded. The contract in question is said to be a “contract implied by law”, a concept which exists in common law systems, and according to which officials are obliged to pay certain contributions and the administration is required, for its part, to award them, when they retire, a pension proportionate to the total number of contributions paid. That legal construction conforms to the hypothesis that the pension is contributory in nature and should be commensurate with the contributions paid.
However, I do not believe that argument can be accepted. The fact remains that according to the Staff Regulations of Officials, the amount of the pension is not determined on the basis of the amount of the contributions paid but by reference to the “total number of years of pensionable service acquired” (first paragraph of Article 2 of Annex VIII to the Staff Regulations) and to the salary payable on termination of service (first subparagraph of Article 82 (1) of the Staff Regulations). Any variation, during the term of the employment relationship, in the amount of the social security contributions paid has no bearing on the final amount of the pension. Therefore, it is quite conceivable that, whilst there is a difference between the total number of contributions paid by them, two officials mav, on retiring, become entitled to a pension of the same amount. Thai mav occur in the case of officials who have acquired the same number of years of pensionable service and who are, on termination of service, in receipt of the same salary, irrespective of the stage reached in their career. That type of system, moreover, is in conformity with that in force in some Member States (for example France, Italy, Luxembourg and The Netherlands) which provides for the monthly deduction from the salaries of public servants of specific amounts by way of social security contributions but does not correlate the amount of the pension to the amounts deducted.
Counsel for Mr Grogan contends that his point of view applies particularly in the case of an official who has been retired in the interests of the service under Article 50 of the Staff Regulations. A decision based on that article would confer on the applicant an immutable right to the allowance provided for in Annex IV to the Staff Regulations and, subsequently, to a pension. However, I do not believe that it is possible to deduce an argument in favour of that contention from the specific situation described. Retirement from the service does not presuppose from a legal point of view any agreement between the administration and the official. On the contran, it clearly reflects the administration's superiority over the employee since it permits any institution to terminate prematurely, on its own initiative, an employment relationship. The fact that specific compensation of a financial nature (temporary allowance) is provided for the official cannot obscure the fact that the procedure laid down in Article 50 enables the administration to terminate at any time its employment relationship with officials in the higher grades if it is in the interests of the sen-ice to do so. To conclude, therefore, the notion that the administration's and the official's intentions are on the same plane and that their convergence gives rise to a pension scheme which is not capable of being amended by the administration, is in my opinion difficult to reconcile with the mechanism of retirement from the sen-ice which is provided for by Article 50 of the Staff Regulations.
6.
Another principle relied upon by the applicants, which is more specific in content, consists in the prohibition of any reduction in pensions.
In my opinion of 14 May 1981 (paragraph 15) I denied the existence, within the framework of the Staff Regulations, of the analogous principle that the remuneration of officials cannot be reduced. At the time, I considered Article 65 of the Staff Regulations of Officials in the light of the adjustment of salaries and of the amendment of weightings, which enabled me to explain that the former does not rule out the possibility of raising or reducing salaries whilst the latter is designed to maintain purchasing power in step with changes in the cost of living. Neither the former nor the latter therefore imply that reductions in salary are prohibited. That observation also applies in the case of pensions since Article 65 is applicable to the pension scheme by virtue of the reference contained in Article 82. I would add, in keeping with the approach I took in my aforesaid opinion, that if the Staff Regulations were to prohibit any reductions in the amount of pensions, the Council could always derogate from that prohibition because a regulation, in the hierarchy of sources of law, has the same force as the Staff Regulations.
Furthermore, I do not believe that in Community law there is a general principle, based on principles common to the legal systems of the Member States, which precludes the reduction of pensions to which former officials, whether in the public sen-ice or otherwise, are entitled. It is true that under some legal systems the right of former officials to maintain the level of their pensions is recognized. There is a guarantee of this kind in the United Kingdom, in Italy and in Luxembourg, whilst the Danish system seems to treat the right to a pension and property rights on an equal footing in the sense that it also affords holders of the former a guarantee of compensation in the event of their being deprived of part of their pension by the State. However, under the legal systems of the other Member States it is recognized that the legislature may at any time amend pension arrangements even in a manner which is less favourable to pensioners. Furthermore, I believe there is a significant trend in the decisions of the European Commission of Human Rights which has not only recognized that the right to receive a pension under a national insurance scheme is not one of the rights and freedoms guaranteed by the European Convention but has also ruled out that it is a property right which may be assimilated to a possession within the meaning of Article 1 of the Protocol of 20 March 1952 (see the decision on Case 4130/69 in Recueil de Décisions No 38, p. 9). Therefore I am of the opinion that there is no principle common to the legal systems of the Member States which prevents the reduction of pensions by means of legislative measures.
According to Counsel for Mr De Pascale, the pension and salar) of officials may be reduced only where there is a fall in the cost of living or financial crisis in the institution. That restrictive principle applies to all international public servants and consequently to the system governing staff employed bv the Community. However, that argument is untenable. I would observe, first of all, that the employment relationship of Community officials is subject to a system established by the Staff Regulations, whereas the employment relationship enjoyed by the officials of most international organizations owes its existence to a contract. That difference in legal basis makes it difficult to derive from the procedures of other organizations principles which are capable of being extended to Community employees. Leaving that aside, the existence of the alleged principle relied upon by the applicant, Mr De Pascale, is incapable of being proved. Instead, there is proof to the contrary, such as Decision No 283 of the Administrative Tribunal of the International Labour Organization, of 4 October 1976 in the case of Watson v Eurocontrol. There, the amount of the pension paid to a former official was reduced and the tribunal had no hesitation in finding that reduction was lawful. That tribunal has therefore denied, implicitly but clearly, the existence of the restrictive principle referred to above.
7.
All the applicants also object to the new system governing the payment of pensions on the ground that it infringes the principle of legitimate expectation. It would appear that former officials who enjoyed for many years the twofold benefit of payment in a strong currency and of the application of a high weighting expected to retain that benefit permanently. The amendments made by the Council in 1978 prejudiced their expectation and are therefore alleged to be unlawful.
In my opinion of 14 May 1981 I recalled that, according to the case-law of this Court, “the expectation is relevant only if it is based on assurances given by the other party” (see, in particular, the judgment of 5 June 1973 in Case 81/72 Commission v Council [1973] ECR 575). On that basis, the fact that the administration awarded pensions of a specific amount could not in itself give rise, on the part of the recipients alone, to any expectation which is relevant from a legal point of view. They should have been aware that the Community authorities are legally empowered to reduce pensions since, as we have seen, former officials do not enjoy any guarantee that their pensions will not be interfered with. The expectation that the amount of the pension would not be reduced could have been legitimately entertained only if the Community authorities had given positive assurances to those concerned of their intention to maintain pensions at the same level at which they were before the amendments introduced in December 1978. In other words, they would have had to decide to exercise self-restraint, declining to exercise their power to alter pensions even in peius. However, that does not appear to have happened, nor have the applicants made such an assertion.
In that connection, I would point out that the administration, in the present case, was not even in a position, on the basis of the provisions in force until December 1978 concerning the payment of salaries and pensions, to exercise reasonable self-restraint as described above, in other words, to promise that it would continue to grant, even for the future, the twofold benefit described above. I have already made clear that the procedure followed before the entry into force of Regulations (EEC) Nos 3085/78 and 3086/78 gave rise to overt discriminatory treatment. The application of a high weighting to pensions paid in a strong currency meant that pensioners residing in countries with a weak currency who had asked to be paid in Belgian francs received higher pensions, in real terms, than their colleagues residing in countries with a strong currency and paid in that currency. In my opinion, even before the Staff Regulations were amended by Regulation (EEC) No 3085/78, the Community authorities could and should have prevented the inequalities in treatment resulting from the distorted application of geographical weightings by applying the provisions of the Staff Regulations without losing sight of the higher principle of equality. Decision No 285 of 4 October 1976, referred to above, of the Administrative Tribunal of the International Labour Organization in the case of Watson v Eurocontrol demonstrates indirectly that such action could have been taken.
As is recognized, the legal system governing officials employed by Eurocontrol, though contractual in nature, is modelled on that governing Community officials. Accordingly, in the case of pensioners, provision was made at the time when the facts referred to in the aforesaid case took place, for the introduction of geographical weightings (kept artificially high to correct rigid exchange rates linked to the parities of the International Monetary Fund) as well as of the right to elect to be paid in a strong currency. Consequently, if the high weightings had been applied in conjunction with payment in a strong currency, the same anomalous results would have been arrived at in the case of officials of Eurocontrol as those which have occured within the Community. That did not happen because the administration considered the joint application of the two criteria to be unlawful. The Administrative Tribunal of the International Labour Organization recognized, in its judgment, that the choice decided upon was in conformity with the law. It observed that to grant a pensioner both the benefit of the weighting and of the currency in which payment is made would have been tantamount to amending significantly the method of calculation laid down by Article 82 of the Administrative Regulations (corresponding to Article 82 of the Staff Regulations of Community Officials). Thus it recognized a pensioner's rights to be paid in Belgian francs but not to exercise his option in such a way as to receive a higher pension than the one calculated in accordance with Articles 82 and 63 (of the Administrative Regulations). The same tribunal pointed out that “payment in Belgian francs must not exceed the exchange value in Belgian francs, at the rate applied at the time of payment, of the amount” expressed in a weak currency paid to pensioners who have elected to be paid in that currency. However, the Community administration preferred, it would appear, to allow a situation the absurdity of which was evident to persist (see, amongst others, the opinion of Mr Advocate General Mavras of 25 February 1975 in Case 28/74 Gillet [1975] ECR 475). But it is precisely for that reason that the situation could not give rise to any legitimate expectation on the part of those benefiting from it. The procedure which was being followed was manifestly contrary to the principle of equal treatment.
Furthermore, the administration began at last to evince the intention to introduce a new system of payments, so as to bring to an end the discriminatory situation. The proposal to amend the Staff Regulations of Officials, submitted by the Commission to the Council on 1 April 1977 (Official Journal C 99, 22 April 1977, p. 5) was in line with that approach. The proposal contemplated the abolition of the fictitious parities of the International Monetary Fund and their replacement by European units of account. The corollary was the abandonment of the high weightings which were until then in force tor countries with a low cost of living. The weighting was no longer to be used to carry out the corrections which were necessary while the parities of the International Monetary Fund had remained unchanged and was once again to serve the purpose defined in the Staff Regulations of adjusting pensions to the cost of living in the country of residence. Thus the previous benefits resulting from the distorted application of weightings were to come to an end.
The observations set out above show tru; the reduction of the pensions paid those residing in countries with ì rak currency who had elected to be pjid ir Belgian francs did not occur ali. i sudden but was, on the awn-, reasonably foreseeable. Mention th.. also be made of the fact that, b\Irne o 21 February- 1978, the Conrm -informed the applicant, Mr De Iju i' that the planned introduction i European unit of account lor ir purpose of calculating salane and pensions would bring to an end ihr times substantial benefit resultinp trerr the exchange rate resulting from the “combination of the weighting for a given country with payment in the currency of another country” and “its re-conversion by the recipient into the currency of the country of residence”. The same explanations were given by the Commission to the European Parliament in its answer of 12 October 1978 to Mr Ripamonti's written question (Question No 412/78 of 30 June 1978, Official Journal C 267, 10 November 1978, p. 18). It was explained at the time that in the case of pensioners “the introduction of the European unit of account” (which is no different in economic terms from the adoption of the parities used for the purposes of the Community budget) “will involve the application of updated exchange rates and could in certain cases cause a reduction of pension”. To explain the reasons for the adverse effects anticipated, it was also expressly recognized that “under the present system some inequality exists on account of the options available under the Staff Regulations for payment of pensions”.
Counsel for Mr Grogan has pointed out that under Anieles 64, 65 and 82 (1) of the Staff Regulations, the proper function of weightings is to adjust pensions to changes in the cost of living which occur in various countries, whilst Regulation (EEC) No 3086/78 has amended the weightings by reference to two criteria of a different nature on the grounds that such weightings were no longer to be used to correct the distortions stemming from the superseded parities of the International Monetary Fund and that it was necessary to take into account the differences in real terms in price levels between the various Member States. The amendments introduced by Regulation (EEC) No 3086/78 are therefore inconsistent with the characteristic function of weightings and, by lowering the level of weightings applicable to countries in which the cost of living had not by any means fallen, are in breach of the principle of legitimate expectation.
It is quite true that there was no drop in the cost of living in countries such as Italy and Ireland in 1978 and that, despite that, the respective weightings were substantially reduced as a result of Regulation (EEC) No 3086/78. However, I do not believe that such a reduction constituted a breach of the principle of legitimate expectation. As we know, the regulation merely restored to the geographical weighting its original function under the Staff Regulations by a change of direction which had become essential once the exchange rates had been updated by the amendment of Article 63 of the Staff Regulations. Therefore it makes no sense to object that pensioners had placed reliance upon the correct application of Articles 64 and 65. It is impossible to have recourse to specific provisions and at the same time endeavour to use them for the purpose of deriving benefits thereunder which conflict with the objectives which those provisions seek to attain. If emphasis is laid on the fact that Article 65 permits weightings to be adjusted only when changes have occurred in the cost of living, then it must also be borne in mind that the weightings amended by Regulation (EEC) No 3086/78 were in no way connected with the purpose of achieving equalization which the Staff Regulations attribute to that instrument but merely constituted a temporary expedient designed to correct the anomalous effects of the parities of the International Monetary Fund laid down in 1965.
Against that background, the argument that the administration led the applicants to believe that the system governing the pavment of pensions would remain unchanged appears to be unfounded. In mv opinion therefore, Regulations (EEC) Nos 3085/78 and 3086/78 cannot be criticized on the ground that they infringe that expectation of officials regarding the retention of the preexisting system. Even if such an expectation existed, it clearly had no legal basis.
8.
According to the applicants, Mr De Pascale and Mr Grogan, Regulations (EEC) Nos 3085/78 and 3086/78 are also invalid because they infringe the principle of equality. In that connection, they observe in the first place that under the system introduced by those regulations, the amount of each pension is not proportionate to the number of contributions paid. The fact that payment of the same number of contributions may result in the award of different pensions and vice versa is contrar)' (this is asserted in particular by Counsel for Mr Grogan) to the principle of equality. I have already had occasion to state that the pensions paid by the Community are not contributory in nature but are based on the Staff Regulations. Thai factor remains constant, regardless of Regulations (EEC) Nos 3085/67 and 3086/78. Therefore the fact that pensions are not proportionate to the contributions paid cannot be regarded as constituting discrimination.
The applicant Mr De Pascale observes, in another connection, that Regulation (EEC) No 3085/78 does not contain adequate transitional measures to offset the adverse effects of the new system on the categories of former officials whose pensions are at time subject to substantial reductions. The fact that the reduction was spread over ten months (from October 1979 to July 1980), as provided for by Article 4 of that regulation, is not a very effective remedial measure in view of the considerable difference between the previous level and the new level of the pensions in question and of the excessively short space of time prescribed for the attainment of the new level. That gives rise to a difference in treatment between pensioners and serving officials in view of the fact that, in the case of the latter, the adverse effects of the new system on transfers of part of their remuneration abroad have been mitigated by effective transitional measures.
The measures referred to are those adopted by the Commission acting in conjunction with the other institutions and contained in “Administrative Notices” No 233 of 30 April 1979. They concern the method of calculating the presumed costs of maintaining dependent persons, referred to in Article 2 (4) of Annex VII to the Staff Regulations, for the purposes of the allocation of family allowances. Since the new weightings introduced by Regulation (EEC) No 3086/78 have in numerous instances affected the evaluation of those costs and resulted in a reduced assessment, it has been laid down that, in the case of officials who on 31 March 1979 were in receipt of family allowances in respect of any persons treated as if they were dependent children and residing in countries in which the presumed costs of maintenance have fallen, those presumed costs are to be frozen for a transitional period of five years. However, that provision is in no way linked to the system governing transfers of pan of an official's salan' abroad. It concerns only a specific category of family allowances. In my opinion, therefore, it is impossible to make a serious comparison between a measure of that kind and the pension scheme, deducing from the comparison an alleged breach of the principle of equality. In actual fact, the situation is quite the reverse of the one described, that is to say, in the case of transfers no transitional provisions have been laid down, whilst in the case of pensions a period of over one year has been prescribed as from the entry into force of Regulations (EEC) Nos 3085/78 and 3086/78 in order to enable the new system of payments to become fully operative once it has led to a reduction in real terms. I have already referred to that distinction between the systems in my opinion of 14 May 1981, specifying the reasons behind it.
The inconsistency between the objections under consideration is confirmed, in more general terms, by the observation that the category of officials and that of pensioners are not comparable and that, in consequence, one of the necessary preconditions for relying on the principle of equality has not been fulfilled.
Finally, I would recall that the absence, in Regulation (EEC) No 3085/78, of adequate transitional measures has also been described as a breach of the duty to provide assistance laid down by Article 24 of the Staff Regulations. I intend to return to that aspect of the matter later.
The applicant, Mr Grogan, considers the breach of the principle of equality from a third, more general, angle which in reality encompasses not onlv Regulations (EEC) Nos 3085/78 and 3086/78 but the very applicability, for which Article 82 of the Staff Regulations makes provision, of geographical weightings to the pension scheme. The reasoning on which weightings are based rests on a presumption of continuous residence by a pensioner in a given country. However, the true state of affairs does not always coincide with that presumption because a pensioner may frequently and for long periods move from one country to another. In view of that possibility, it should be acknowledged that the geographical weighting does not really serve the purpose of ensuring that all pensioners enjoy the same purchasing power regardless of where they reside. Instead, it gives rise to sharper inequalities than those which would arise if it did not exist. Pursuing the same train of thought, Counsel for Mr Grogan adds an observation based on the general principle of freedom of movement for persons. The fact that the weighting is linked to residence in a specific country has the effect of encouraging certain choices — a pensioner's decision to settle in a specific place — and to discourage others, and thus constitutes “an unjustified invasion of privacy”.
I am of the opinion that those objections are unfounded. I do not deny that the applicability of the weighting to pensions may have some (in any event, a very limited) impact on freedom of movement for pensioners. But in my opinion, it must be borne in mind that the Community legislature intends, by means of the geographical weighting, to achieve a result which ensures equivalence, namely ihat of guaranteeing, in general terms, that all pensioners enjoy, all other things being equal, the same purchasing power. The result achieved is, on the whole, consistent with the principle of equality of treatment. That strikes me as more important, from the point of view of the public interest, than the slight restriction which is imposed on freedom of movement in order to attain that result.
In that connection, I would recall that this Court considered the geographical weighting inherent in the allowances to which former officials are entitled in its judgment of 21 May 1981 in Case 29/80 Reinan s Commission [1981] ECR 1311. In that case, a former Commission official residing in Canada had left the service in 1973 under the special provisions contained in Regulation (EEC) No 2530/72 of the Council of 4 December 1972 and was in receipt of a monthly allowance calculated by applying the weighting in force for Belgium even though it bore no relation to the cost of living in Canada. The applicant complained that the same weighting was applied to other former officials residing in countries where the cost of living is far lower than it is in Canada. That was contrary to the principle of equality and the freedom to settle in the country of one's choice. The Court pointed out that all those former officials were treated in the same way because they had elected to settle outside the Community and it took the view that as a result of that fact, it was impossible to find that any discrimination had occurred (paragraph 15 of the decision), h is difficult to derive from such a concise piece of reasoning any precise guideline for the purpose of the present cases. However, I believe it is significant that the Court did not find that there had been a breach of the principle of equality, even under a system which unifies remuneration in factual situations which undoubtedly differ from one another, and that it considered the common factor given prominence by the Community legislature as lawful, probably because it is in closer conformity with the Community's interest in simplification.
9.
Counsel for Mr De Pascale also contends that the reduction of certain pensions brought about by Regulations (EEC) Nos 3085/78 and 3086/78 runs counter to the Staff Regulations to such an extent as to influence the former officials concerned to become subiect to the Staff Regulations. That reasoning restates the argument of the so-called attempt to undermine the fundamental conditions of the employment relationship, which I have already refuted in my opinion of 14 May 1981. In practice, that argument may perhaps be tenable in connection with a contractual system of employment relationships but certainly not in connection with a system governed by the Staff Regulations such as that established for Community officials.
10.
The applicants Mr Curtis and Mr Grogan have inferred that Regulation (EEC) No 3086/78 is vitiated by a misuse of powers inasmuch as the new weightings have been fixed without taking into account the changes which have occurred in the cost of living and therefore without reference to the conditions laid down by Article 65 (2) of the Staff Regulations. Thus, by acting in the way the Council thus used the instrument of weightings for purposes other than those specifically provided for by Anieles 64 and 65 of the Staff Regulations.
That objection, as more widely formulated, encompasses cases in which the new weightings have not led to a reduction in pensions (that is to say, in particular, cases of pensioners who elected to be paid in the currency of the country of residence) as well as cases where there has been a reduction (and which concern, as we know, pensioners who reside in countries with a lower cost of living and who elected to be paid in a strong currency). As far as the position of the former category is concerned, I believe that in order to rule out the existence of a misuse of powers it is quite sufficient to observe that since the new weightings have left the level of pensions unchanged, they have safeguarded the link between pensions and the level of the cost of living, in keeping with the objectives which Articles 64 and 65 (2) of the Staff Regulations seek to achieve. As regards the position of the second category, I consider the observation which 1 made earlier to be decisive, namely that the updating of the parity has made it necessary to use the geographical weightings for their original purpose as defined in the Staff Regulations. The reduction in pensions, which is in many cases the result of that operation, must be ascribed to the fact that it was necessary to terminate an unlawful procedure which was manifestly contrary to the principle of equality. Against that background, it is legitimate to state that the amendment of weightings introduced by Regulation (EEC) No 3086/78, designed primarily to correct the previous distortion, was in conformity with the objectives laid down bv Article 65 aimed at equalizing pensions.
11.
The applicants, Mr Grogan and Mr De Pascale, contend that Regulations (EEC) Nos 3085/78 and 3086/78 are vitiated by the infringement of certain rules of secondary legislation, in particular the provisions of the Staff Regulations concerning weightings (Anieles 64, 65 (2) and 82) and the provision which requires the administration to assist its own officials (Article 24).
On the first point, I would refer to my observations on the misuse of powers. The applicant's reasoning is the same, even though in this context it relates to the infringement of provisions of Community law, and in my opinion calls for the same answer.
As regards the alleged breach of Article 24 of the Staff Regulations, a more detailed discussion is called for. The applicants argue that the Commission failed to adopt adequate transitional measures capable of offsetting, by spreading them out over a period of time, the adverse effects of the new system on pension levels. In that light, spreading the reductions over a period of ten months does not constitute a very effective remedy, panicularly in view of the extent of the reductions which, in some cases, amount to 50% of the amount previously. received by the pensioners concerned.
I would recall that Article 24 of the Staff Regulations requires the Communities to assist their own officials. The first paragraph of that article specifies, by way of example (as is apparent from the expression “in particular” which prefaces the first part of the provision), assistance to an official in proceedings against any person perpetrating any attack on personal property to which he or a member of his family is subjected. The second paragraph provides, as a corollary to the duty contained in the previous paragraph, for the obligation to compensate the official for damage suffered in such cases, whilst the third paragraph relates to further training and instruction for officials which the Communities are required to facilitate. Bearing in mind that that brief list is not exhaustive, we must ask ourselves whether the duty to provide assistance also entails the obligation to mitigate, by spacing them out over a period of time, the adverse effects of any amendments made to the system governing employment relationships. In my opinion, even though that question may, in general terms, be answered in the affirmative, everything depends on the content of the amendment and on the circumstances which have played a part in giving rise to the adverse effects of the amendments.
In the present cases, it is quite clear that on the basis of Article 65 (2) the Council is under an obligation to adjust weightings in the event of substantial changes in the cost of living. The decisions which it adopts on the basis of that provision must also comply with the provisions of Article 65 as far as the time-limits are concerned in the sense that every adjustment must be decided on within the prescribed period. It seems to me therefore that to maintain in force for several years, by virtue of the “adequate” transitional measures upon which the applicants rely, geographical weightings which are incapable of reflecting the differences between price levels in the different Member States would be manifestly contran. to the rule contained in Article 65. I do not believe that, in such a case, the duty to provide assistance laid down by Article 24 can take precedence over the unequivocal provisions of Article 65, the essential feature of which is that it constitutes a technical instrument for the achievement of equalization.
Furthermore, Regulation (EEC) No 3086/78 already contains a transitional provision which, as we know, spaces out over a period of over one year (from April 1978 to July 1979) the reduction of certain pensions. The effect of that provision has been to preserve for a considerable period the previous inequalities in the treatment of officials.
To spread out over an even longer period the full implementation of the reductions would, in my opinion, have opened an even wider breach in the principle of equality beyond the extent to which it could be justified by Article 24 of the Staff Regulations.
12.
On the basis of all the foregoing considerations, I propose that the Court dismiss the applications brought by Mr Vincent Grogan and Mr Luigi De Pascale against the Commission and by Mr Dunstan Curtis against the European Parliament, by documents lodged at the Registry on 27 May 1980, 14 July 1980 and 18 July 1980 respectively.
In view of the nature of the disputes, the parties should be ordered to bear their own costs, pursuant to Article 70 of the Rules of Procedure.
(
1
)	Translated from the Italian.