Sebastian Moffett and Claire Davenport
Workers protesting austerity on the streets of southern Europe were not to know it, but earlier this month there was also a strike at the heart of the EU, by bureaucrats fighting possible cuts.
For an increasing number of Europeans, cuts in Brussels are what is needed.
The European capital has told member states to reduce spending, but as millions in Spain, Portugal and Greece feel the pain in pay, pensions, and social services, people are looking to the centre and finding what looks like fat.
Britain has led the way.
Newspapers there have for decades carped at cosy “eurocrats”, as they call Europe’s civil servants. Prime Minister David Cameron needs only mention the EU and generous spending to produce a sea of nods and chants of “hear, hear!” around parliament.
“We can’t have European spending going up and up and up when we’re having to make difficult decisions in so many different areas,” Cameron said at the last summit of EU leaders last month, going on to express his frustration at the salaries of civil servants in Brussels.
Doubts mounting
Now, doubts are mounting in other member states. Such concerns have held up talks over the EU’s long-term budget, a financial programme worth more than e1 trillion (R11.2 trillion) over the next seven years. EU leaders hope to reach a deal at a summit on Thursday and Friday.
The problem is that governments from Helsinki to Madrid are freezing spending or cutting it by 5 percent or more a year, but the European Commission has asked for a 6 percent increase over 2014 to 2020. An influential group of eight EU countries, including Germany, France and Britain, wants the Commission to save between e5 billion and e15bn over the period.
The Commission argues that it has already made cuts. But in politics, symbolism matters, and numerous examples appear to contradict the claims of restraint:
l The European Parliament shifts its base once a month from Brussels to Strasbourg in France, at an annual cost of e180 million.
l The European Council is building a new “Europa” headquarters right next door to its existing marble-and-glass building, at a cost of e310m.
l The European Court of Auditors, another EU institution, announced earlier this month that 4 percent of spending in the last EU budget had been “irregular”, although this was largely due to mismanagement by member states.
l EU civil servants get generous health and pension benefits and free private education for their children in Brussels’ leafy neighbourhoods.
l EU institutions have cellars stocked with 47 000 bottles of red, white and sparkling wine with a value of e515 000, according to a response to questions from German member of the European parliament Martin Ehrenhauser.
Cayo Lara, the leader of Spain’s left-wing Izquierda Unida party, puts it succinctly: “While Brussels applauds, Spain bleeds,” he said.
Until the financial crisis hit, polls by EU opinion monitor Eurobarometer showed Europeans liked the EU significantly more than their own governments. But the latest, published in May, showed just 31 percent trusted the EU, the lowest level ever, and just three points above trust in national governments.
“The EU started out with the best of intentions,” said Memnon Prokopiou, a retired lawyer in Athens.
“But its leaders need to show more solidarity to the people of the south. There is huge inequality in Europe and they are responsible for this.”
Pre-emptive cuts
Cameron is under pressure at home, and finds a convenient and familiar scapegoat in Brussels. Hitting out at EU spending casts him in a role played with success by Margaret Thatcher, who in 1984 famously won a rebate after threatening to halt payments to the EU budget.
Britain, Cameron said last month, had cracked down on central administration, “and we need to see in the budget proposals that sort of rigorous approach”.
The bill for Brussels is not actually enormous. The entire cost of running the EU and all its development, aid, research and subsidy programmes amounts to only 1 percent of the bloc’s gross domestic product (GDP). In most member states, government spending takes up nearer 40 percent to 50 percent of GDP.
Administration is just 6 percent of the EU budget, and there is evidence the Commission has cut back. Officials say they began tightening their belts long before the crisis.
A fraud and cronyism scandal in 1999, which forced all the EU’s commissioners to resign, triggered a shake-up of how the institution and its administration is run.
“Unlike the member states, we didn’t wait for a crisis,” said Antony Gravilli, the Commission’s spokesman for administration and related costs.
From 2004, entry-level pay was lowered, officials had to contribute more to pensions and tax, and automatic pay rises were capped.
The Commission also started to employ contract staff who do not receive the EU’s full benefits and now make up 20 percent of its 33 000-strong workforce.
The changes triggered a decline in the purchasing power of EU officials, according to figures provided by the Commission. Now it says it doesn’t pay enough to attract as many qualified staff from richer western European countries as it needs.
The Commission has proposed to peg its administrative costs to inflation for five years, and aims to cut staff by 1 percent a year, saying this will help save e1bn by 2020.
Felix Geradon, a translator at the council who helped lead the recent strike, said EU institutions would not be able to function properly after significant cuts. He is planning another strike for tomorrow.
Geradon said politicians seeking EU budget cuts were mainly out to please domestic political audiences, but top officials in Brussels could learn from ministers in countries such as France who have taken pay cuts: “There could, or should, be gestures from the top of our institutions.”
The salary study
Even though the European Commission has cut administrative costs, a little-known study carried out on its behalf suggests EU pay is still broadly better than for officials in most member states.
The study, prepared for the Commission by management consultants in 2009 but not published before now, compared net pay and conditions in the Commission with that of 26 other organisations, many of which declined to be named, but which included the North Atlantic Treaty Organisation .
It found EU officials in general did much better than all but the most senior national civil servants, although they were less paid than people in international organisations.
A married financial officer at the Commission is paid between e45 000 and e105 000, compared with between e18 000 and just under e50 000 on average in a national civil service, the report said.
Changes in EU civil servants’ pay are dictated by a formula based on what public officials in member states earn.
The EU pay moves in line with the average, but lags by a year. That meant EU staffers were due a raise last year, just as some national officials were suffering cuts. Britain, France and Germany have refused to grant the formula-based increases.
The Commission has taken them to the EU’s top court, the European Court of Justice. The case is pending.
“In politics you need visible gestures, and there should be some more of these,” said Stephan Keukeleire, a professor of politics at the University of Leuven, and a specialist in European policy.
Cyprus holds the rotating presidency of the EU. It has proposed cutting at least e50bn from the long-term budget by reducing administrative costs.
There appears to be broad agreement among member states that this will be the deal hammered out later this week.
In May, think-tank Open Europe, which is sceptical of Brussels, suggested cuts to reduce the total EU budget by 30 percent.
These would come partly in development and agricultural subsidies that it said were ineffective, and partly from scrapping projects it believes are not needed.
One of these, the Committee of the Regions, has an e80m budget to provide a voice for sub-national authorities from places such as Catalonia.
Another project the think-tank would scrap is the House of European History, a museum being built in Brussels on the initiative of the European Parliament.
It will feature exhibits on postwar history and is scheduled for completion in 2015 at a cost of more than e50m. – Reuters