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Europe

Germany Blocks EU Parliament Pay Reform

Germany and three other EU states have blocked an attempt to reform the pay system for European parliamentarians, meaning it's now unlikely that a reform package will be passed before EU-wide elections in June.

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Critics say the current pay system for European Parliament deputies is open to fraud.

Efforts to reform the European Parliament's pay system for its deputies have been under way since 1998. But there's still no end in sight, following the collapse of pay reform talks in Brussels on Monday.

The majority of members of the European parliament (MEP's) would welcome reforms. The system has earned itself a bad reputation for being open to fraud. The expenses system is not based on actual costs supported by receipts. An MEP who flies to Brussels with a budget airline, for example, could get away with claiming the highest air fare, thereby pocketing the difference.

The relaxed expenses system has long been used to narrow the differences in salaries between MEP's who are paid the same as their national lawmakers.

Inequality

The discrepancies are huge. Italian MEP's earn the most with a salary of around €12,000 ($14,960) a month, while their Spanish counterparts earn around €3,000. The differences will become even greater when MEP's from the EU's new accession countries join the ranks. Hungarian MEP's will earn €800 a month, while Lithuanian deputies can expect to take home around €350.

European Parliament President Pat Cox fought for a deal to standardize pay among MEP's in return for switching to a real expenses system, backed up with receipts.

But Germany, joined by France, Sweden and Austria, argued that the proposed new deputies' salaries of around €9,000 a month were too generous, and vetoed key parts of the proposal.

Cox said their decision was deeply disappointing.

Bad timing for Germany

German Foreign Minister Joschka Fischer put Germany's resistance down to bad timing. He said the government can't back what would be a substantial pay rise for German MEP's when it's pushing through harsh reforms and cuts in health care at home. German MEP's currently receive a monthly salary of €7,000.

Fischer tried to highlight the positive. "This gives the parliamentarians the opportunity to argue their position in the election campaign," he said, referring to EU-wide elections in June.

Swedish Foreign Minister Laila Freivalds said she blocked the reform proposals because the standardized salary would mean that Swedish MEP's would earn double that of Sweden's national lawmakers.

Austria called the reforms a "step in the right direction," but also expressed concern that the proposed salaries – calculated as half the salary of a judge in the European Court of Justive – were too high.

The failure of EU states to reach an agreement on Monday means the current pay and expenses system is set to continue. It is up to the European Parliament's court to decide whether to propose a whole new draft resolution. But that would be a time intensive procedure, and as parliament stops it's legislation session at the end of April, it's almost certain that pay reform will become a campaign issue in June.

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