Explanatory Memorandum to COM(2011)890 - Amendment of the Staff Regulations of Officials and the Conditions of Employment of Other Servants of the EU - Main contents
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| dossier | COM(2011)890 - Amendment of the Staff Regulations of Officials and the Conditions of Employment of Other Servants of the EU. |
|---|---|
| source | COM(2011)890  |
| date | 13-12-2011 |
The Staff Regulations constitute the legal framework for employment and working conditions for the approximately 55 000 officials and other agents employed by more than fifty institutions and agencies located in different places of employment in the European Union and in third countries.
Given the historic challenges the EU is facing today, the quality, commitment, independence and loyalty of its staff are more important than ever. At the same time, these challenges require a particular effort by each and every public administration and each and every member of its staff to improve efficiency and to adjust to the changing economic and social context in Europe.
Recent events in the global economy as well as the subsequent need to consolidate public finances cannot fail to have an impact on the European civil service and the administrations of all EU institutions, bodies and agencies. Administrative expenditure of the EU is a mere 5.8% of the multi-annual financial framework for 2007 – 2013 which itself represents around 1% of the EU's GDP. Nevertheless, it is important to demonstrate that all EU institutions and their staff continue their drive for efficiency and economy and to reflect the fiscal constraints which many public administrations in Europe experience.
Given that the EU and its institutions face great challenges, the proposal must strike a balance between the necessary drive for further efficiency and economies and the ability of the institutions to carry out their policies. This includes the needs of EU institutions as employers to attract and retain staff of the highest professional competence in various fields of expertise. The institutions recruit on a market for highly qualified persons who are able to work in a multicultural and multilingual environment and who are ready to move and stay abroad with their families. In the light of upcoming retirements in EU institutions, which will mainly affect staff from the 15 Member States of the Union before 2004, it will be a particular challenge to maintain the geographical balance of all Member States among staff. Given the demographic changes in Europe, attracting and retaining excellent staff from all Member States will be even more difficult in the future.
The proposal has to be seen in the context of the major reform of the Staff Regulations which entered into force on 1 May 2004. This reform overhauled the entire European civil service law and brought significant changes to all areas of the European civil service. The entire career system was revised. A new category of staff, contract agents, was introduced, with generally lower salaries. The salary grid for officials and temporary agents was revised, by allowing recruitment of staff at lower grades and, consequently, with lower starting salaries. The reform also introduced more flexible and family-friendly working conditions by extending the maximum duration of leave on personal grounds and introducing parental leave.
As regards the pension scheme, the retirement age was increased from 60 to 63 with transitional measures for staff members already in place, the pension accrual rate for newcomers was reduced from 2 % to 1.9 %, and the pension rights acquired after 1 May 2004 are no longer subject to correction coefficients for higher cost of living. The method for keeping the pension scheme in actuarial balance was laid down in Annex XII to the Staff Regulations. Lastly, a new method for adjusting the remuneration and pensions of EU civil servants was adopted.
All these changes taken together have brought significant savings to the EU budget and their annual impact continues to increase: the reform has produced 3 billion Euros of savings so far and will produce another 5 billion Euros of savings until 2020. The Eurostat study on the long-term budgetary implications of pension costs showed that, in the long run, annual savings of the 2004 reform on pension costs, leaving aside the impacts on other areas, will exceed 1 billion Euros.
A method for adjusting salaries and pensions has existed since 1972 and proved to be a helpful tool for avoiding annual discussions on salary adjustments and possible strikes that are linked to such discussions. Through the years the method has been modified on several occasions, for the last time in 2004. Given that the current method expires at the end of 2012, the Commission is now proposing a new method, which reflects the political decisions adopted by Member States as regards the salary adjustments of their civil servants, whilst addressing the shortcomings that have become apparent during and after the discussions on the 2009 annual adjustment. The computation system for the pension contribution rate expires on 30 June 2013, and the Commission is proposing a new system in line with a common actuarial practice.
This proposal also takes account of the Council's conclusions and the requests made in accordance with Article 241 TFEU: on the application of the exception clause for the method, on the pension scheme of EU civil servants, including the early retirement scheme, and the career structure in order to link closer the salary and responsibilities. Moreover, it takes account of the criticism expressed on some outdated elements of the Staff Regulations to the extent that criticism is justified.
The Commission proposal strikes the balance between cost-efficiency and the needs of the institutions in the field of human resource management. The European Commission considers that, if this proposal is adopted, the EU institutions will continue to be assisted by an independent, efficient and modern European civil service that will allow them to fulfil the tasks which they have been entrusted with by the treaties.
Contents
- RESULTS OF CONSULTATIONS WITH THE INTERESTED PARTIES AND IMPACT ASSESSMENTS
- budgetary implications
- Collection and use of expertise
- 3. MAIN ELEMENTS OF THE PROPOSAL
- Method for adjusting salaries and pensions
- Solidarity levy
- Modifications to the pension system in order to keep pace with demographic developments
- Raising the age for early retirement to 58 years and reducing the number of officials benefiting from early retirement
- Aligning the methodology for calculating the pension contribution rate to international actuarial practice
- Adapting the conditions of employment
- Maintaining flexitime working-time arrangements
- Allowances and entitlements: reducing the annual travelling time, the annual travelling allowance and adaptation of the rules on the reimbursement of removal costs and on missions
- Transparency measures for Institutions and agencies
- Career of assistants, new career stream for secretaries and more flexibility in recruiting contract staff
- Recruitment of contract staff
- Addressing unjustified geographical imbalances
- Increasing efficiency in staff management for the agencies
This proposal has been discussed with the staff representatives in accordance with the appropriate procedures and takes into account the outcome of those discussions.
Before the adoption, the proposal has been subject to consultations with the Staff Regulations Committee and the Staff Committee of the European Commission.
There was no need for external expertise.
Reducing staff by 5%
It is proposed to reduce the staff of each institution and agency by 5%, and this would be done by not replacing a certain number of departures, i.e. those who retire and those whose contracts come to an end. Without prejudice to future decisions of the budgetary authority, the obligation for the institutions and agencies to respect their commitment to reduce the number of staff is to be reflected in Article 6 of the Staff Regulations.
The new method would preserve the principle of parallelism between the evolution of salaries of national officials and that of the EU officials, and would address the shortcomings of the current method:
– The new method would reflect nominal salary changes (instead of real salary changes) in all Member States. In this way the method will precisely follow salary changes in all Member States of the European Union and not only in a limited sample;
– In order to reduce the time lag in an extraordinary situation, the new exception clause would be automatically applied in case two conditions are met: 1) a decrease in the EU's GDP, and 2) the gap between the adjustment value of the remuneration and pensions of EU staff and the change in the EU's GDP exceeds two percentage points. If both conditions are fulfilled, half of the adjustment value would be postponed to the next year. For instance, this clause would have been triggered in 2009.
– The Brussels International Index would be suppressed. The differences in the increase in the cost of living between each place of employment and that of the Member States would be calculated and reflected in correction coefficients. A new joint correction coefficient would be introduced for Belgium and Luxemburg, considering these Member States as a single place of employment. It will be fixed at 100 for the first year.
As is the case for the current method, the proposed method is not an indexation based on inflation, as it simply follows the evolution of the purchasing power of national civil servants, as decided by each Member State at the national level.
Since 1982, the method has been linked to an additional tax on salaries, due to the effects of the oil crisis. Despite the improvement in the economic situation, this additional tax has not been phased out, but has become a measure linked to the automatic application of the method. It is suggested that, for the duration of the proposed method, the solidarity levy be increased at the rate of 6%.
Increasing the normal retirement age to 65 years
Currently, the normal retirement age is 63 years for officials recruited after 1 May 2004. Officials recruited before 1 May 2004 are subject to transitional provisions according to which the retirement age varies from 60 years to 63 years.
It is proposed to increase the normal retirement age for officials recruited as of 1 January 2013 at 65 years. Similar transitional rules as those applied in 2004 would be implemented, i.e. the retirement age of officials recruited before 1 May 2013 would vary from 60 to 65 years.
Furthermore, it will no longer be only on an exceptional basis that the possibility to continue working until 67 years would be granted.
Additional measures would be provided in order to take due account of the acquired pension rights and the obligation to maintain the pension scheme in actuarial balance.
Raising the age for early retirement to 58 years and reducing the number of officials benefiting from early retirement
Currently, the minimum early retirement age is set at 55 years. Under the new proposal, the minimum early retirement age would be set at 58 years. In addition, the maximum number of officials retiring in a given year without a reduction of their pension rights would be fixed at 5 % of the officials in all institutions who retired during the previous year (as opposed to 10% in the current system). This scheme is maintained since it has proven useful for all institutions as a HR management tool in the course of the last enlargement exercise.
Aligning the methodology for calculating the pension contribution rate to international actuarial practice
The computation system for the pension contribution rate expires on 30 June 2013. It is proposed to keep the same methodology, but to increase the moving average for interest rates and salary growth to 30 years. A transitional period of eight years would apply.
As a result of this amendment, the pension contribution rate would become more stable and less sensitive to short-term variations in the interest rates, and thus less subject to debates. It would put the computation system in line with common actuarial practice, suggesting that past observations ranging between 20 and 40 years be used for ensuring the balance of pension schemes.
Introducing a minimum number of weekly working hours
The 5 % staff cut would require that every staff member take a share of the additional work burden, if the same policy objectives are to be achieved.
It is therefore proposed to introduce in the Staff Regulations a minimum number of working hours per week, i.e. 40.
Flexible working-time arrangements allow reconciling work and private life and facilitate suitable gender balance within the Institutions while respecting the mandatory working time obligations. It is therefore appropriate to introduce a clear reference to these arrangements in the Staff Regulations. Managers would not be subject to these general arrangements for staff, as managers are empowered by the institutions to manage time of their staff and their own time.
Allowances and entitlements: reducing the annual travelling time, the annual travelling allowance and adaptation of the rules on the reimbursement of removal costs and on missions
Staff members are currently entitled to a maximum of six days per year of travelling time to their place of origin. It is proposed to limit the annual travelling time to a maximum of three days.
The annual travel allowance is based on kilometric distance by railway, which is often not the most habitual route to travel to the place of origin. Therefore, the distance would be calculated as a great circle distance, which would have an effect of decreasing individual allowances. Furthermore, the payment of annual travel expenses would be limited to territories of the Member States of the EU.
In order to reduce the administrative burden both for the staff members concerned and the administration, the rules on the reimbursement of removal costs should be simplified. It is therefore proposed to introduce cost ceilings which take account of the official's or agent's family situation and of the average cost of removal and associated insurance.
The rules on mission should be adapted in order to take account of the specific need of an institution whose staff members must frequently go on mission to the principal places of work of their institution. It is proposed to allow in such cases the reimbursement of accommodation costs on the basis of a flat-rate sum.
The Staff Regulations are implemented through a series of measures adopted by the Institutions and agencies. In order to ensure coherent and harmonised implementation of the Staff Regulations and for reasons of simplification, the Commission implementing rules would apply by analogy to agencies.
However, in order to take account of the specific situation of agencies, they will be able, after receiving an authorisation from the Commission, either to adopt different implementing rules or to decide, where appropriate, not to apply any implementing rules.
For the sake of transparency, the Court of Justice would establish a register containing the implementing rules of all the institutions.
Career of assistants, new career stream for secretaries and more flexibility in recruiting contract staff
Reserving the highest grades for staff with the high level of responsibilities
In order to establish a clear link between responsibilities and grade, the career stream in the assistants' function group would be restructured in such a way to reserve the two highest grades (AST 10 and 11) only for officials and temporary agents who exercise significant responsibilities for staff management, budget implementation and/or coordination.
New function group 'AST/SC' for secretaries and clerical staff
In the current domains of AST staff, career structures need to be adjusted further to different levels of responsibility, so as to establish a suitably nuanced spectrum of career streams in the European civil service and to limit administrative expenses, as envisaged in the multi-annual financial framework. To this end, a new function group 'AST/SC' for secretarial and clerical staff should be introduced. Salaries and promotion rates proposed for this new function group establish a suitable correspondence between the level of responsibility and the level of remuneration. In this way it will be possible to preserve a stable, comprehensive and well-balanced European civil service, as considered necessary by many institutions.
In order to give more flexibility to the institutions, the maximum length of contracts for auxiliary contract staff would be extended from 3 to 6 years.
In addition, while the vast majority of officials will continue to be recruited on the basis of open competitions, the institutions would be authorised to organise internal competitions which are also open to contract staff.
The Staff Regulations stipulate that European Union officials are to be recruited on the broadest possible geographical basis. However, the statistical data show that, while some nationalities are overrepresented in comparison with the relative weight of their population in the European Union, others are largely under-represented. These imbalances are particularly noticeable in certain grades.
Therefore, Article 27 of the Staff Regulations should be amended in order to allow the institutions to take measures correcting long lasting and significant geographical imbalances, while preserving the principle of recruitment based upon the highest standard of ability, efficiency and integrity. This measure shall be adopted by way of general implementing measures and shall be subject to a report after five years.
European agencies have become an important part of the institutional landscape of the European Union. Today there are 45 structures (32 regulatory agencies, 7 joint undertakings and 6 executive agencies). In total, they employ almost 8 000 members of staff, mostly engaged as temporary agents. However, the provisions of the Staff Regulations and the Conditions of Employment of Other Servants are not fully adapted to the needs of small structures such as agencies.
For this reason the Commission suggests introducing a new category of temporary staff for agencies. They would be recruited following a transparent and objective selection procedure and could be engaged for an indefinite period of time. If necessary, agencies would be able to second them in the interests of the service. Also, temporary staff in agencies could take unpaid leave up to a maximum of 15 years throughout their entire career. The mobility within the agency and between the agencies would be facilitated, because grade and step would be maintained in case they decide to apply for a new post, provided that the range of grades for the new posts includes their grade.
Agencies would have a certain flexibility when setting up a series of committees that shape the social dialogue or must be consulted before a decision is taken.
The proposal would have a budgetary impact on the expenditure and revenue of the European Union. Due to transitional provisions, the financial impact of certain provisions would gradually increase and would reach its full effect only in the long term. The savings over the next multiannual financial framework are estimated to exceed 1 billion Euros. In the long run, the savings from the proposed amendments would be 1 billion Euros per year. More details are provided in the financial statement, which is annexed to this proposal.