Unions insist on input to pay-and-pension reforms

Šefcovic proposes staff cuts and longer hours, as unions warn of threat to ‘unity’ of civil service.

Maroš Šefcovic, the European commissioner for interinstitutional relations and administration, caused wide surprise  and provoked union disquiet last week when he presented plans for changes to EU officials’ pay and pensions. 

A group of eight member states, including the UK, France and Germany, had called for “substantial reductions” in administration spending through changes to staff pay and benefits.

Šefcovic’s plans include many of the proposals from the group of eight and, in some areas, go even further.

He is proposing cutting 5% of staff in all EU institutions and recruiting secretarial and clerical staff as contract agents rather than full-time officials. The working week would be increased to 40 hours from 37.5 hours. Šefcovic has also proposed raising the retirement age from 63 to 65 and lifting the early-retirement age to 58.

Consolidating public finances

Speaking on 29 June after the Commission had approved the plan, Šefcovic justified his approach arguing that all public authorities needed to make savings. “The current challenge to consolidate public finances is forcing every public administration across Europe to improve efficiency and to adjust to the changing economic and social context,” he said. “This cannot fail to have an impact on the EU institutions and their staff.”

He said that the package of reforms he was proposing would save €1 billion by 2020, adding to the €8bn that would be saved by the 2004 reform of staff pay and benefits.

The reaction of the staff unions has, predictably, been negative. They have, however, withdrawn a threat to strike on 8 July, after it became apparent that support for strike action was not unanimous.

Fact File

Elements of staff reform

5% reduction of staff in all categories in all institutions in 2013-17 through normal turnover (retirement and restraint in new contracts)

An increase in minimum working week for all staff in all institutions from 37.5 hours to 40 hours, without compensatory wage adjustments

Normal retirement age will increase from 63 to 65

Possibility of working voluntarily until 67 will be made easier and more attractive

Minimum age for early retirement without reduction of acquired pension rights will increase from 55 to 58; access to the scheme will be limited

Secretarial and clerical tasks in the institutions will be carried out by contractual staff rather than officials with lifetime appointments; staff will be recruited as contract agents with the possibility of obtaining contracts of unlimited duration

The maximum number of leave days for staff to visit their country of origin will be reduced from six to two

The method

The method for annual adjustments to salaries and pensions would be simplified and extended for another eight years. From 1 January 2013, Sweden and Poland would be added to the basket of eight member states used to track the evolution of national civil servants’ spending power. A new exemption clause would allow the institutions to react to economic crises. The method would be accompanied by a new solidarity levy of 5.5%, applied from 1 January 2013 until 31 December 2020.

Union representatives met Šefcovic and José Manuel Barroso, the European Commission president, on 30 June, the day after the plans were approved. Cristiano Sebastiani, a member of the executive council of Renouveau et Démocratie, the second largest union, told the Commissioners “not to fall in love with your reform”. He singled out plans to recruit secretarial staff as contract agents as a threat to the “unity” of the European civil service.

Staff unions issued a joint statement after the meeting in which they challenged the Commission plans to reduce staff numbers and reform rules on pay and pensions.

The unions want the Commission to give guarantees that they will be able to negotiate details of the reform so that parts of what Šefcovic has proposed can be revised. They also want pledges that, once the unions and the Commission have completed their negotiations, unions will retain a say on any further changes that the Commission might agree with the European Parliament and the Council of Ministers. If not, they want the Commission to promise to withdraw the proposal. They are calling on the Commission to defend the attractiveness of EU civil service and its working conditions throughout the negotiations.

The unions are warning that unless the Commission agrees to these demands there could be “a major social conflict”.

Centre-right MEPs, by contrast, welcomed Šefcovic’s plans. Ingeborg Grässle, a German centre-right MEP who has been very critical of Commission officials’ working arrangements, said that it was a “good basis” for adapting EU officials’ working conditions “to the current time”. “The Commission has understood that it cannot cling to rules for a working environment from another century,” she said, adding that the rules should be “thoroughly revised and modernised”.

Staff consultations

Šefcovic’s proposals will be discussed with staff representatives before and after the summer break. Based on these consultations, the Commission will draw up a formal proposal for revision of the staff rules in the autumn. The changes will have to be negotiated and agreed with the Council and MEPs. A new method for calculating staff pay and pensions will have to be agreed by the end of 2012 at the latest because that is when the current system expires. The system for calculating pensions expires in mid-2013.

Šefcovic said when announcing his plans that the latest reform “recognises and builds on what we have already done,” referring to the 2004 reforms.

In the current economic climate, with governments struggling to push through unpopular pension reforms and other cuts in public spending at national level, member states are unlikely to share Šefcovic’s appreciation of the earlier reform. Instead, they will take his proposals as the starting point for negotiations, in which they will push hard for deeper cuts and savings. The unions may end up wishing they could accept Šefcovic’s plan – which might end up looking generous compared to what the member states eventually decide.