Proposal for a Council Regulation adjusting the correction coefficients applicable to the remuneration and pensions of officials and other servants of the European Union
Date: 2010-05-06
Institutions: European Commission
Subjects: European official, Latvia, Lithuania, pension scheme, regulations for civil servants, servant (EU), wage determination

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EUROPEAN COMMISSION 

Brussels, 6.5.2010 
COM(2010)215 final 

2010/0117 (NLE) 

Proposal for a 

COUNCIL REGULATION 

adjusting the correction coefficients applicable to the remuneration and pensions of 
officials and other servants of the European Union 

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EXPLANATORY MEMORANDUM 

1. 

CONTEXT OF THE PROPOSAL 

•  Grounds for and objectives of the proposal 

In  accordance  with  Article  4  of  Annex XI  to  the  Staff  Regulations,  intermediate 
adjustments  of  remuneration  and  pensions  under  Article  65(2)  of  the  Staff 
Regulations are to be made, on the basis of information provided by Eurostat, in the 
event of a substantial change in the cost of living between June and December, with 
due allowance being made for the forecast of the change in purchasing power during 
the current annual reference period. 

Any  Commission  proposal  needed  is  to  be  sent  to  the  Council  not  later  than  the 
second half of April. 

•  General background  

In accordance with Article 6 of Annex XI to the Staff Regulations, adjustments are to 
be made for all places (including Brussels) if the sensitivity threshold is reached in 
Brussels. If that sensitivity threshold is not reached, adjustments are only to be made 
for those places where the threshold is exceeded. 

In accordance with Article 7 of Annex XI to the Staff Regulations, the amount of the 
adjustment is to be the Brussels International Index multiplied, where appropriate, by 
half of the specific indicator forecast if this is negative.  

The  specific  indicator  measures  changes  in  the  net  remuneration,  exclusive  of 
inflation, of national civil servants in Member States' central governments. Eurostat 
has  calculated  this  indicator  on  the  basis  of  the  information  supplied  by  the  eight 
Member States referred to in Article 1(4) of Annex XI to the Staff Regulations. 

The Brussels International Index measures changes in the cost of living in Brussels 
for  European  Union  officials.  Eurostat  has  drawn  up  this  index  on  the  basis  of  the 
information provided by the Belgian authorities. 

The correction coefficients are the ratio between the relevant economic parity and the 
exchange  rate  provided  for  in  Article  63  of  the  Staff  Regulations  multiplied,  if  the 
adjustment threshold is not reached for Brussels, by the amount of the adjustment. 

The economic parities for remuneration establish the purchasing power equivalence 
of the remuneration paid in Brussels, as the reference city, with that paid in the other 
places  of  employment.  Eurostat  has  calculated  those  parities  in  agreement  with  the 
national statistical bodies. 

The economic parities for pensions establish the purchasing power equivalence of the 
pension  paid  in  Belgium,  as  the  reference  country,  with  that  paid  in  the  other 
countries  of  residence.  Eurostat  has  calculated  those  parities  in  agreement  with  the 
national statistical bodies. 

•  Existing provisions in the area of the proposal 

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This  proposal  is  in  addition  to  the  proposal  presented  each  year  for  adjusting 
remuneration and pensions. 

•  Consistency with other policies and objectives of the Union 

Not applicable. 

2. 

RESULTS OF CONSULTATIONS WITH THE INTERESTED PARTIES AND 
IMPACT ASSESSMENTS 

•  Consultation of interested parties 

Methods  of  consultation  used,  main  sectors  covered  and  general  profile  of 
respondents 

The  elements  of  the  proposal  have  been  discussed  with  the  staff  representatives  in 
accordance with the appropriate procedures. 

Summary of replies received and the way in which they have been taken into account 

The proposal takes account of the opinions of the parties consulted. 

•  Collection and use of expertise 

There was no need for external expertise. 

•  Impact assessment 

–  The purpose of the proposal is to adjust remuneration and pensions in accordance 

with the legislation in force. 

–  The legislation in force permits no alternative. 

3. 

LEGAL ELEMENTS OF THE PROPOSAL 

•  Summary of the proposed action 

In accordance with Article 4 of Annex XI to the Staff Regulations, the purpose of the 
proposed action is to adjust remuneration in those places in which there has been a 
substantial change in the cost of living. 

The change in the cost of living for Brussels, measured by the Brussels International 
Index, over the period June to December of the previous year, is 0.6%.  

Changes in the cost of living outside Belgium and Luxembourg during the reference 
period are measured by the implicit indices calculated by Eurostat. These indices are 
calculated  by  multiplying  the  Brussels  International  Index  by  the  change  in  the 
economic parity. 

The sensitivity threshold is the percentage corresponding to 7% for a twelve-month 
period (3.5% for a six-month period). 

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The implicit index applicable to remuneration exceeds the threshold in the following 
countries or places: 

–  Latvia -5.8%, 

–  Lithuania -4.0%. 

The  implicit  index  applicable  to  pensions  exceeds  the  threshold  in  the  following 
countries or places: 

–  Latvia -4.8%. 

The  intermediate  adjustment  is  the  Brussels  International  Index  multiplied,  where 
appropriate, by half of the specific indicator forecast if this is negative. 

The  specific  indicator  forecast  is  -0.2%,  and  thus  the  amount  of  the  intermediate 
adjustment is 0.5%. 

The correction coefficients are the ratio between the relevant economic parity and the 
exchange rate multiplied, if the adjustment threshold is not reached for Brussels, by 
the amount of the intermediate adjustment. 

These correction coefficients take effect on 1 January. However, for those countries 
or  places  whose  implicit  index  is  greater  than  6.3%,  they  take  effect  on  16 
November. For those countries or places whose implicit index is greater than 12.6%, 
they take effect on 1 November. 

As a result, with effect from 1 January 2010, the correction coefficients applicable to 
remuneration for those countries or places exceeding the threshold are: 

–  Latvia 79.6, 

–  Lithuania 73.4. 

As a result, the correction coefficients applicable to transfers by officials and other 
servants to those countries or places exceeding the threshold are: 

–  Latvia 73.3. 

According  to  the  second  subparagraph  of  Article  20(1)  of  Annex  XIII  to  the  Staff 
Regulations  the  minimum  applicable  correction  coefficient  for  pensions  is  100. 
Therefore, the correction coefficients applicable to pensions remain unchanged. 

•  Legal basis 

The Staff Regulations, and in particular Annex XI thereto, constitute the legal basis. 

•  Subsidiarity principle 

The  proposal  concerns  an  area  that  falls  within  the  exclusive  competence  of  the 
Union. The principle of subsidiarity does not therefore apply. 

•  Proportionality principle 

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The  proposal  is  consistent  with  the  principle  of  proportionality  for  the  following 
reasons: 

–  Annex XI to the Staff Regulations provides for a Council Regulation. 

–  The financial burden results directly from application of the method of adjustment 

provided for in the Staff Regulations. 

•  Choice of instruments 

Proposed instrument(s): Regulation. 

Other instruments would have been inappropriate for the following reasons: 

–  Annex XI to the Staff Regulations provides for a Council Regulation. 

4. 

BUDGETARY IMPLICATION 

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

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2010/0117 (NLE) 

Proposal for a 

COUNCIL REGULATION 

adjusting the correction coefficients applicable to the remuneration and pensions of 
officials and other servants of the European Union 

THE COUNCIL OF THE EUROPEAN UNION, 

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

Having regard to the Protocol on the Privileges and Immunities of the European Union, and in 
particular Article 12 thereof, 

Having  regard  to  the  Staff  Regulations  of  Officials  of  the  European  Union  and  to  the 
Conditions  of  Employment  of  other  servants  of  the  Union,  as  laid  down  by  the  Council 
Regulation  31  (EEC),  11  (EAEC)1,  and  in  particular  Articles  64,  65(2)  of  the  Staff 
Regulations  and  Annexes  VII,  XI  and  XIII  thereto,  and  the  first  paragraph  of  Article  20, 
Articles 64 and 92 of the Conditions of Employment of Other Servants, 

Having regard to the proposal from the European Commission, 

Whereas 

(1) 

There  was  a  substantial  decrease  in  the  cost  of  living  in  Latvia  and  Lithuania  in  the 
period  from  June  to  December  2009,  the  correction  coefficients  applied  to  the 
remuneration of officials and other servants should therefore be adjusted. 

HAS ADOPTED THIS REGULATION: 

Article 1 

With effect from 1  January 2010, the correction coefficients applicable, under Article 64 of 
the  Staff  Regulations,  to  the  remuneration  of  officials  and  other  servants  employed  in  the 
countries and places listed below shall be as follows: 

–  Latvia 79,6, 

–  Lithuania 73,4. 

1 

OJ P 45, 14.6.1962, p. 1385 

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Article 2 

With effect from the first day of the month following that of the publication of this Regulation 
in  the  Official  Journal  of  the  European  Union,  the  correction  coefficients  applicable  under 
Article 17(3) of Annex VII to the Staff Regulations to transfers by officials and other servants 
shall be as follows: 

–  Latvia 73,3. 

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

Article 3 

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

Done at Brussels,  

For the Council 
The President 

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LEGISLATIVE FINANCIAL STATEMENT 

1. 

NAME OF THE PROPOSAL: 

Council  Regulation  adjusting 
to 
remuneration and pensions of officials and other servants of the European Union. 

the  correction  coefficients  applicable 

the 

2. 

ABM / ABB FRAMEWORK 

Policy Area(s) concerned and associated Activity/Activities: 

All areas and activities are potentially concerned. 

3. 

BUDGET LINES 

3.1. 

Budget  lines  (operational  lines  and  related  technical  and  administrative 
assistance lines (ex- B..A lines)) including headings: 

Expenditure: XX.01.01.01 Commission and Chapter 11 Other institutions. 

Revenue: 400 - Proceeds of the tax on the salaries, wages and allowances of officials, 
other  servants and  persons in receipt  of  a  pension,  404  -  Proceeds  from  the  special 
levy  on  the  salaries  of  members  of  the  institutions,  officials  and  other  servants  in 
active employment, 410 - Staff contributions to the pension scheme. 

3.2. 

Duration of the action and of the financial impact: 

Indefinite. 

3.3. 

Budgetary characteristics: 

Budget 
line 

XX.01.01
.01 
and 
Chapter 
11 

Type of expenditure 

New 

EFTA 
contribution 

Contributions 
from applicant 
countries 

Heading in 
financial 
perspective 

Non-
compuls
ory 
expendit
ure 

Non-
diff2 

NO 

NO 

NO 

No [5] 

2 

Non-differentiated appropriations hereafter referred to as NDA 

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4. 

SUMMARY OF RESOURCES 

4.1. 

Financial Resources 

4.1.1. 

Summary of commitment appropriations (CA) and payment appropriations (PA) 

Expenditure type 

Section 
no. 

Year
2010 

2011

2012

2013

2014 

Total 

2015 
and 
later 

EUR million (to 3 decimal places) 

Operational expenditure3 

Commitment Appropriations 
(CA) 

8.1. 

Payment 
(PA) 

Appropriations 

a 

b 

Administrative expenditure within reference amount4 

Technical  &  administrative 
assistance (NDA) 

8.2.4. 

c 

TOTAL REFERENCE AMOUNT 

Commitment 
Appropriations 

Payment Appropriations 

a+c

b+c

Administrative expenditure not included in reference amount5 

Human 
associated 
(NDA) 

resources 

and 
expenditure 

Administrative  costs,  other 
than  human  resources  and 
not 
associated 
reference 
in 
included 
amount (NDA) 

costs, 

8.2.5. 

d 

-0,100 

-0,100 

-0,100 

-0,100 

-0,100 

-0,100 

8.2.6. 

e 

Total indicative financial cost of intervention 

TOTAL CA including cost 
of Human Resources 

TOTAL  PA  including  cost 
of Human Resources 

a+c
+d
+e 

b+c
+d
+e 

-0,100 

-0,100 

-0,100 

-0,100 

-0,100 

-0,100 

-0,100 

-0,100 

-0,100 

-0,100 

-0,100 

-0,100 

Not 
avail-
able 

Not 
avail-
able 

Not 
avail-
able 

3 
4 
5 

Expenditure that does not fall under Chapter xx 01 of the Title xx concerned. 
Expenditure within article xx 01 04 of Title xx. 
Expenditure within chapter xx 01 other than articles xx 01 04 or xx 01 05. 

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Co-financing details 

Not applicable 

4.1.2.  Compatibility with Financial Programming 

X 

Proposal is compatible with existing financial programming. 

(cid:133) 

(cid:133) 

Proposal  will  entail  reprogramming  of  the  relevant  heading  in  the  financial 
perspective. 

Proposal  may  require  application  of  the  provisions  of  the  Interinstitutional 
Agreement6 (i.e. flexibility instrument or revision of the financial perspective). 

4.1.3.  Financial impact on Revenue 

(cid:133) 

Proposal has no financial implications on revenue, 

X 

Proposal has financial impact – the effect on revenue is as follows: 

Budget line 

Revenue 

EUR million (to one decimal place) 

Situation following action 

2010 2011 2012  2013  2014  2015

Prior to
action 
2009 

410 Pension 
contribution 

a) Revenue in absolute terms  0,217 

0,206 0,206 0,206  0,206  0,206  0,206

b) Change in revenue 

 ∆ 

-0,011 -0,011 -0,011  -0,011  -0,011 -0,011

400 Tax 

a) Revenue in absolute terms  0,095 

0,090 0,090 0,090  0,090  0,090  0,090

b) Change in revenue 

 ∆ 

-0,005 -0,005 -0,005  -0,005  -0,005 -0,005

404 Special levy 

a) Revenue in absolute terms  0,018 

0,017 0,017 0,017  0,017  0,017  0,017

b) Change in revenue 

 ∆ 

-0,001 -0,001 -0,001  -0,001  -0,001 -0,001

4.2. 

Human Resources FTE (including officials, temporary and external staff) – see 
detail under point 8.2.1. 

Not applicable 

6 

See points 19 and 24 of the Interinstitutional agreement. 

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5.  CHARACTERISTICS AND OBJECTIVES 

5.1. 

Need to be met in the short or long term 

The obligation under the Staff Regulations. 

5.2. 

Value-added  of  Union  involvement  and  coherence  of  the  proposal  with  other 
financial instruments and possible synergy 

Not applicable. 

5.3. 

Objectives, expected results and related indicators of the proposal in the context 
of the ABM framework 

Not applicable. 

5.4.  Method of Implementation (indicative) 

X 

Centralised Management 

X 

directly by the Commission: PMO. 

6. 

MONITORING AND EVALUATION 

6.1.  Monitoring system 

Not applicable. 

6.2. 

Evaluation 

6.2.1.  Ex-ante evaluation 

Not applicable. 

6.2.2.  Measures  taken  following  an  intermediate/ex-post  evaluation  (lessons  learned  from 

similar experiences in the past) 

Not applicable. 

6.2.3.  Terms and frequency of future evaluation 

Evaluation took place in 2008. 

7. 

ANTI-FRAUD MEASURES  

Not applicable. 

8. 

DETAILS OF RESOURCES 

Not applicable. 

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