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Vice-President of the European Commission
Responsible for Inter-institutional Relations and Administration
More value for money from the European Civil Service
Press conference on the proposed changes to the Staff Regulations
Brussels, 29 June 2011
Ladies and gentlemen,
Since I took up my position as Commission Vice-President more than a year ago, I have been impressed by the quality and the commitment of staff in the EU institutions.
Clearly, we need the EU and its institutions to overcome the current economic and financial difficulties, tackle difficult policy objectives, and play a role on the global stage. Just as clearly, those institutions need the best economists, lawyers and other professionals they can get in order to do this.
Without high quality staff, there would be no Single Market. No Schengen area. No Europe-wide environmental measures. Lots of over-pricing by cartels and monopolies!
Nevertheless, 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.
And this cannot fail to have an impact on the EU institutions and their staff.
The Commission has been living up to its responsibility from the start of the crisis. It has:
The major staff reform of 2004 is also still paying dividends. This lowered entry-level salaries; reformed the pension scheme; introduced contract agents; and established a new method for adjusting salaries and pensions.
It has already delivered €3 billion in savings. It is set to generate another €5 billion in savings between now and 2020 and even more in the long-term.
All this has helped us to keep admin costs at around 6% of the EU budget. And you know how the rest is invested: in people, in businesses, in infrastructure all over Europe and the rest of the world.
In other words, the Commission didn't wait for a crisis to put its house in order. But our search for greater efficiency and value for money remains a constant concern, particularly in these difficult times.
So we can and should do more.
The method for annual adjustments to salaries and pensions expires at the end of next year. And the Council and Parliament have asked us to look again at certain aspects of the Staff Regulation. This provides the perfect opportunity to come forward with a single package of proposals that recognises the interlinked nature of different elements of Human Resources management.
Earlier this year, I called for this package to show 'ambition with a sense of proportion'. And the proposals, backed by my fellow Commissioners today, deliver exactly that.
The package is ambitious; but it very clearly recognises, and builds on, what we have already done. It adds more than another €1 billion in savings to the €8 billion the 2004 reform is expected to save by 2020.
It won't damage our ability to deliver the policies we have to deliver. And it strikes the right balance between on the one hand, the need to adjust, modernise and generate savings, and on the other hand, the need to ensure working conditions that continue to attract the top talent we need.
This is a difficult balancing act. Since the 2004 reforms we are already struggling to attract people in certain job categories - like competition lawyers, and financial experts - and to maintain geographical balance in our recruitment, as required by law.
Ladies and gentlemen,
I won't list every change we are proposing; all the key ones are available in the press release available outside. But let me highlight one or two of the most important ones.
First, we have taken the very difficult decision to propose a cut in staff across all institutions of 5%.
No-one will be dismissed or forced to retire. The reduction should take place over a 5-year period simply by not replacing staff who retire or whose contract comes to an end.
But it will mean existing staff working harder and longer in order to deliver the same challenging policy objectives. That is why we propose an increase in the minimum working week, with no wage adjustment to compensate.
Retirement ages will also rise, and early retirement options will be reduced, in line with reforms we are asking Member States to carry out, to ensure pensions are adequate, sustainable and safe.
We also propose to continue with 'the method' for annual adjustments of pensions and salaries - albeit with some modifications – and introduce a new solidarity levy on salaries of 5.5%, to replace the existing special levy.
The method was designed back in 1970 to avoid the distraction of annual salary negotiations, by tracking the evolution of national civil servants' purchasing power – whether up or down.
It has proved its value and achieved its aim: the net purchasing power of European officials has decreased by 1.9 % since 2004, more or less the same as the 1.8% decrease for national civil servants.
Add the impact of the increasing special levy and rising pension contributions, making purchasing power drop 4.2% since 2004, and it quickly becomes clear that 'the method' is not the unaffordable luxury that some claim.
I am proud of what staff in the EU institutions have achieved and continue to achieve. They are hard-working, highly talented, multilingual and deliver results. With these proposals, the EU institutions also demonstrate their determination to contribute to the goal of sustainable public finances across Europe.