PARIS As Europe ponders the future of its fraying union, Parliament members will vote this week on pay reforms for themselves that are designed to repair the legislature's tarnished reputation for exploiting perks and privileges.
The new proposal eliminates a system that allows lawmakers to claim travel expenses at up to 10 times actual costs and sets a standard monthly salary of €7,000, or $8,500, for each of the 732 members. But within the fine print of the pay plan, new benefits appear.
There is a free pension that lawmakers can qualify for at age 63. The pay deal also specifies that Parliament will maintain an existing voluntary pension, which is underfunded and was bailed out seven years earlier with an €8 million government contribution.
The deal's supporters, who expect passage of the proposal in a full vote by the Parliament in Brussels on Thursday, argue that common salaries will eliminate inequities among legislators whose pay is pegged to standards in their nations.
"Now everyone will get the same payment and we will solve one of the key criticisms that has been made against Parliament," said Klause-Heiner Lehne, a German and Christian Democrat Parliament member, who noted that the travel expense system had served in the past as a "kind of income compensation" to reduce pay differences.
But critics remain wary of new reforms, contending that the pay deal is simply a savvy form of political sleight of hand, which sets a monthly salary palatable to voters, but doles out new benefits.
"This is nothing more than an old Soviet system of wheeling and dealing by people who claim that they are fostering European ideals, but on the contrary only care about themselves," said Hans Peter Martin, an Austrian and an independent Parliament member who successfully campaigned against Parliament perks and privileges in the last Parliament election.
Even lawmakers with nagging doubts about the plan say they expect that the contentious salary issue - which has been debated for almost a decade - will most likely be settled with a favorable vote.
"It's my impression that this is really a compromise. In the end, I think that we should go for it," said Edith Mastenbroek, a Dutch Parliament member and Socialist Party member who still has concerns about the free pension. "The compromise is to lower the salary and then not pay the pension any more. I don't think that's something I'm going to be able to explain to my constituents."
Last year, various EU governments balked at a proposed monthly salary of €8,600, a figured tied to 50 percent of the salary of a judge of the Court of Justice of the European Community. Now the new monthly salary is set at 38.5 percent, a figure that will rise automatically with scheduled salary increases for the court.
Martin unsuccessfully sought to change the proposal with amendments that would have required Parliament to vote in the future on its own salary increases. He also tried to prevent any government contributions to the underfunded voluntary pension fund.
Earlier this year, one of Parliament's largest political groups, the Socialists, circulated an internal background briefing paper on the voluntary pension fund. It noted that the Luxembourg-registered fund is not a classic pension fund, but rather a "nonprofit association" that is subject to the risks of investment returns.
When the fund issued its last annual report in December 2003, future liabilities exceeded assets by almost €42 million, meaning that the funding level was little more than 75 percent. The voluntary pension fund suffered through two years of investment downturns, with negative returns of 4.4 percent in 2001 and 17.5 percent in 2002.
"It's extremely underfunded," said Carl Schlyter, a Swede and a Green party member in the Parliament, who recalled that the last time the fund was bailed out by Parliament there were pledges to reform the system.
Lehne, who has participated in negotiations on the pay deal, said that with the proposal the legislator would guarantee the fund and likely cover underfunding. "It simply means that, for those members of Parliament who contributed already, the fund will stay alive.
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