Proposal for a Council Regulation introducing special measures to terminate the service of officials of the Commission of the European Communities as part of the reform of the Commission
Date: 2001-01-31
Institutions: European Commission
Subjects: European Commission, European official, early retirement, institutional reform, pension scheme, recruitment, survivor's benefit, termination of employment

29.5.2001

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Official Journal of the European Communities

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Proposal for a Council Regulation introducing special measures to terminate the service of officials
of the Commission of the European Communities as part of the reform of the Commission

(2001/C 154 E/20)

COM(2001) 50 final (cid:151) 2001/0027(CNS)

(Submitted by the Commission on 31 January 2001)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European
Community, and in particular Article 283 thereof,

Having regard to the proposal made by the Commission after
consulting the Staff Regulations Committee in accordance with
Article 10a of the Staff Regulations of Officials of the European
Communities, (1),

Having regard to the opinion of the European Parliament,

Having regard to the opinion of the Court of Justice,

Having regard to the opinion of the Court of Auditors,

Whereas:

(1) A reform is now under way in the Commission designed in
particular to refocus the use of its resources on priority
activities.

(2) A communication from the Commission (2) has indicated,
despite the successes already achieved in 1999 and 2000,
some shortfalls in the staff assigned to certain priority
activities.

(3) The Commission intends to meet a significant part of those
needs through internal rationalisation and redeployments.

(4) The Commission intends to take steps, mainly through
training, to help redeployed staff to adjust in the most
satisfactory and effective way possible.

(5) However,

the skills of some officials, particularly older
members of staff, are deemed not to be in line with the
duties to be performed.

the establishment plan, but

(6) The Commission needs new skill profiles and a rebalancing
of
the number of officials
retiring in the normal way will not be sufficient to allow
the necessary skills to be acquired through recruiting new
staff within a satisfactory timescale.

(7) Special measures

should accordingly be adopted with

regard to termination of service,

HAS ADOPTED THIS REGULATION:

Article 1

in the
The European Commission is hereby authorised,
interests of the service and in order to take account of the

(1) Hereinafter called the (cid:145)Staff Regulations(cid:146).
(2) Doc. No 6343/00 INST 4.

need to renew skills arising from the refocusing of the use of
its resources on priority activities, to adopt measures up to 31
December 2002 for terminating the service within the meaning
of Article 47 of the Staff Regulations of officials who have
reached the age of 50 and have completed at least 10 years’
service, regardless of the budget (operating or research) from
which they are paid, with the exception of those in Grades A1
and A2, under the conditions specified below.

Article 2

The total number of officials to be covered by the measures
referred to in Article 1 shall be 600. For 2001 the number
shall be 300.

Article 3

Within the ceiling laid down in Article 2, and with due regard
to the interests of the service, the Commission, after having
consulted the Joint Committee, shall select from among the
officials applying for
service under
termination of
Article 1 those to whom it wishes to apply this measure.

their

The Commission shall consider as a priority officials affected
by the reorganisation measures and measures for refocusing the
use of its resources on priority activities,
in particular rede-
ployment, whose skills are deemed not to be in line with the
duties to be performed. It shall take account of the amount of
training necessary for the officials to undertake new tasks, their
age, ability, performance, conduct in the service, family circum-
stances and length of service.

Article 4

1.
Former officials whose service is terminated under Article
1 shall be entitled to a monthly allowance set as a percentage
of the last basic salary received according to age and length of
service at the time of departure as shown in the table in Annex
I to this Regulation. The last basic salary shall be that for the
grade and step held by the official at the time of departure,
determined by reference to the table in Article 66 of the Staff
Regulations in force on the first day of the month for which
the allowance is payable.

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Such former officials may at any time, at

their own
2.
request,
receive a retirement pension on the terms and
conditions laid down in the Staff Regulations. Entitlement to
the allowance shall then cease. It shall cease in any event not
later than the last day of the month in which the former
official reaches the age of 65 years or as soon as the former
official is eligible before that age for the maximum retirement
pension of 70 % (Article 77 of the Staff Regulations).

At that point the former official shall automatically receive a
retirement pension, which shall take effect on the first day of
the calendar month following the month in which the
allowance was paid for the last time.

3.
The allowance provided for in paragraph 1 shall be
the country situated
adjusted by the weighting fixed for
inside the Community in which the recipient proves that he
is resident.

the recipient resides in a country situated outside the
the weighting to be applied to the allowance

If
Community,
shall be 100.

The allowance shall be expressed in euro. It shall be paid in the
currency of the country of residence of the recipient. However,
to the weighting of 100 under the second
if
subparagraph, it shall be paid in euro.

is subject

it

An allowance paid in a currency other than euro shall be
calculated on the basis of the exchange rates referred to in
the second paragraph of Article 63 of the Staff Regulations.

4. Where gross income accruing to the former official from
any new employment, when combined with the allowance
provided for in paragraph 1, exceeds the total gross remun-
eration last received by the official, determined by reference to
the salary scales in force on the first day of the month for
which the allowance is payable, the amount of the excess shall
be deducted from that allowance. That remuneration shall be
weighted as provided for in paragraph 3.

Gross income and total gross remuneration last received, as
referred to above, mean sums paid after deduction of social
security contributions but before deduction of tax.

The former official concerned shall provide any written proof
which may be required and shall notify the institution of any
factor which may affect his or her right to the allowance,
failing which he or she shall be liable to disciplinary action
as provided for in Article 86 of the Staff Regulations.

thereto,

As set out in Article 67 of the Staff Regulations and
5.
Articles 1, 2 and 3 of Annex VII
the dependent
child allowance shall be payable either to the recipient of the
allowance provided for in paragraph 1 or to the person or
persons to whom custody of the child or children has been
entrusted by law or by an order of court or of the competent
the household allowance shall be
administrative authority;
calculated by reference to the allowance provided for
in
paragraph 1.

6.
Recipients of the allowance shall be entitled, in respect of
themselves and persons covered by their insurance, to benefits
under the sickness insurance scheme provided for in Article 72

the Staff Regulations provided they pay the relevant
of
contribution,
allowance
calculated on the basis of
provided for in paragraph 1, and are not covered by another
sickness insurance scheme by virtue of
legal or statutory
provisions.

the

7.
During the period for which they are entitled to receive
the allowance, but for not more than six years, former officials
shall continue to acquire further rights to retirement pension
based on the salary carried by their grade and step, provided
that the contribution provided for in the Staff Regulations by
reference to that salary is paid during that period and provided
that the total pension does not exceed the maximum specified
in the second paragraph of Article 77 of the Staff Regulations.
For the purposes of Article 5 of Annex VIII to the Staff Regu-
lations, such period shall be considered to be a period of
service.

8.
Subject to Articles 1(1) and 22 of Annex VIII to the Staff
Regulations, the surviving spouse of a former official who dies
while in receipt of the allowance provided for in paragraph 1
shall be entitled, provided that they have been the official’s
spouse for at least one year when he or she left the service
of the Commission, to a survivor’s pension equal to 60 % of
the retirement pension which, irrespective of length of service
or age, would have been payable to the former official if he or
she had qualified for it at the time of death.

in

to

the

referred

pension

survivor’s

The
previous
subparagraph shall not be less than the amounts specified in
the second paragraph of Article 79 of the Staff Regulations.
However,
the
retirement pension to which the former official would have
been entitled had he or she survived and been granted a
the
retirement pension when ceasing to be eligible for
allowance referred to above.

in no case may it exceed the amount of

The minimum duration of the marriage as referred to in the
first subparagraph shall not be taken into account if there are
one or more children of a marriage contracted by the official
before he or she left the service provided that the surviving
spouse maintains or has maintained those children.

Nor shall the duration of the marriage be taken into account if
the former official’s death resulted from one of the circum-
stances referred to at the end of
the second paragraph of
Article 17 of Annex VIII to the Staff Regulations.

in receipt of

On the death of a former official

9.
the
allowance provided for paragraph 1, dependent children
within the meaning of Article 2 of Annex VII to the Staff
Regulations shall be entitled to an orphan’s pension on the
conditions set out in the first, second and third paragraphs
of Article 80 of the Staff Regulations and in Article 21 of
Annex VIII to the Staff Regulations.

Article 5

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

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

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ANNEX 1

ALLOWANCE PERCENTAGE

The allowance percentage referred to in Article 4(1) of this Regulation will be determined on the basis of the age and
length of service of officials at the time of departure as shown in the table below:

Level of allowance depending on age and length of service

Length of service

10 to 19 years

20 to 29 years

30 years and over

Age

from 50
to 52 years

from 53
to 55 years

from 56
to 58 years

from 59
to 61 years

from 62
to 64 years

60,0 %

62,5 %

65,0 %

62,5 %

65,0 %

67,5 %

65,0 %

67,5 %

70,0 %

67,5 %

70,0 %

70,0 %

70,0 %

70,0 %

70,0 %

Age and length of service will be considered in relation to a trigger date to be specified when the call for applications for
the termination-of-service arrangements is issued.

Applying these conditions to the existing target group of officials gives an average allowance of 65 %.

ANNEX II

BASIS FOR CALCULATING BUDGET NEUTRALITY

This Annex sets out in detail the parameters for calculating the particulars shown in the budget statement. The starting
point is that the operation should be budget-neutral. The method of calculation involves determining the savings to be
achieved through a termination-of-service scheme for 600 officials (difference between the cost of their remuneration as
officials in active employment and the allowance they would receive after leaving the service) and the number of new
staff that these savings would allow to be recruited. This approach applies during the period for which the allowance is
payable, up to the time the former officials become eligible under the pension scheme.

Parameter 1: Target group

The scheme will apply to 600 members of staff, most of whom will have reached the end of their career bracket ((cid:145)fin de
carriŁre(cid:146)). Based on the existing target group of officials, the breakdown would be roughly as follows:

A/LA 3 officials

A/LA 4-A/LA 5 officials

B 1-B 2 officials

C 1-C 2 officials

D 1-D 2 officials

Total

2001

22

134

45

80

19

300

2002

22

134

45

80

19

300

Total

44

268

90

160

38

600

The references to grades A 3, A 4, A 5 and A 7 in this Annex refer to both Category A and LA (the Language Service).

Parameter 2: Average profiles of officials availing themselves of the scheme

The costs are based on the standard profiles below:

A 3: A 3/3 official, married, with no dependent children, recruited at 32

A 4-A 5: A 4/2 official, married, with no dependent children, recruited at 32

B 1-B 2: B 1/2 official, married, with no dependent children, recruited at 30

C 1-C 2: C 1/2 official, married, with no dependent children, recruited at 28

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D 1-D 2: D 1/5 official, married, with no dependent children, recruited at 30

The average age of such officials over the age of 50 is 55.

Parameter 3: Average profiles of newly recruited officials

Officials availing themselves of
proportions,
respectively), and presumed to be married with one dependent child.

the scheme will be replaced by officials in categories A and B (in the current
i.e. approximately two thirds A/LA and one third B) recruited at the basic grades (A 7/3 and B 5/3

Parameter 4: Average level of allowance

Applying the conditions set out in Annex I to the existing target group of officials (meeting the criteria for age and
length of service) gives an average level of allowance of 65 %, which is the level used to make the calculations.

Parameter 5: Other assumptions

The base figures (salaries, allowances, etc.) include a projected indexing at 2,5 % of the present amounts (adjustment
under the (cid:145)Method(cid:146) for 2000 and updating in mid-2001).

The level of the expatriation allowance, included in the remuneration of staff in active employment, is estimated at 12 %
(average of the rates of 0 %, 4 % and 16 % according to individual situations).

The geographical weighting applied to the remuneration of the former officials is estimated at 105 (depending on where
they establish residence after leaving the service).

Annual budget savings arising from the scheme

The annual budget cost of individual officials before leaving the service is shown in the table below:

Annual budget cost per official in active employment

Basic salary

Household allowance

Secretarial allowance

Expatriation

Employer’s
Sickness Insurance Scheme

contribution

to

the

Joint

Community tax

Temporary contribution

Personal pension contribution

A 3/3

A 4/2

B 1/2

C 1/2

D 1/5

114 027

5 701

90 272

4 514

64 226

3 211

14 367

11 374

8 093

4 846

3 837

(cid:150) 23 572

(cid:150) 15 026

(cid:150) 3 214

(cid:150) 9 407

(cid:150) 2 466

(cid:150) 7 447

2 729

(cid:150) 7 238

(cid:150) 1 554

(cid:150) 5 299

40 621

2 095

1 928

5 357

1 726

(cid:150) 3 338

(cid:150) 544

(cid:150) 3 351

35 047

2 095

4 457

1 490

(cid:150) 2 412

(cid:150) 306

(cid:150) 2 891

Budget cost per official

102 749

85 058

64 168

44 494

37 480

Details of the annual budget cost of individual officials after leaving the service are shown in the table below (expenses
associated with leaving the service are not additional costs but costs paid in advance and are not included in the
calculation):

Annual budget cost per official after leaving under the scheme

Allowance

Household allowance

Weighting

Employer’s
Sickness Insurance Scheme

contribution

to

the

Joint

Community tax

Personal pension contribution

A 3/3

A 4/2

B 1/2

C 1/2

D 1/5

74 118

3 706

3 355

2 520

(cid:150) 9 097

(cid:150) 9 407

58 677

2 934

2 656

1 995

(cid:150) 5 674

(cid:150) 7 447

41 747

2 095

1 890

1 419

3 060

(cid:150) 5 299

26 403

2 095

1 233

898

(cid:150) 1 620

(cid:150) 3 351

22 780

2 095

1 078

775

(cid:150) 2 891

Budget cost per official

65 195

53 141

38 792

25 658

23 837

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Details of the annual budget savings achieved as a result of the scheme (savings from the departure of one official and
total savings) are shown in the table below:

Annual budget savings arising from the scheme

Cost per official in active employment

102 749

85 058

64 168

44 494

37 480

A 3/3

A 4/2

B 1/2

C 1/2

D 1/5

Total

Cost per official
scheme

leaving under the

Savings per official

Number of officials
scheme will apply

to whom the

65 195

37 554

53 141

31 917

38 792

25 376

25 658

18 837

23 837

13 643

44

268

90

160

38

600

Total budget savings

1 652 376

8 553 756 2 283 840

3 013 920

518 434

16 022 326

The total annual budget saving is EUR 16 022 326.

Cost of new posts and recruitment possibilities

Details of the average annual budget cost of one new official are shown in the table below (the career weighting takes
account of career advancement during the relevant period; expenses associated with taking up appointment are not
included in the calculation):

Annual budget cost per new official

Basic salary

Household allowance

Dependent child allowance

Education allowance

Expatriation

Employer’s contribution to the Joint Sickness Insurance Scheme

Community tax

Temporary contribution

Personal pension contribution

Total budget cost of scheme

Career weighting

Budget cost per official

A 7/3

57 643

2 882

2 698

2 411

7 587

2 450

(cid:150) 4 572

(cid:150) 1 291

(cid:150) 4 756

65 052

1,06

68 955

B 5/3

37 107

2 095

2 698

2 411

5 027

1 577

(cid:150) 1 973

(cid:150) 401

(cid:150) 3 061

45 480

1,06

48 383

The annual budget cost of recruiting 258 new officials (two thirds in Categories A/LA and one third in Category B) is
equivalent to the total annual budget savings arising from the scheme:

Total annual budget cost of new posts

Budget cost per official

Number of new posts

A 7/3

68 955

172

B 5/3

48 383

86

Total

258

Total budget cost of recruitment

11 860 260

4 160 938

16 021 198

The savings arising from the departure of 600 officials under the termination-of-service scheme would mean
that 258 new officials could be recruited, two thirds of them A/LA officials and one third B officials.