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BRUSSELS — Former members of the European Parliament enrolled in a plush pension scheme that’s nearing implosion will have their payouts cut in half as senior lawmakers try to stave off a bailout that would cost EU taxpayers millions.
More than 900 people, including former pro-Brexit MEPs and several current EU commissioners, continue to receive thousands of euros in monthly payouts from the Parliament’s additional pension pot. But the legacy retirement scheme, which ran for two decades before being closed to new members in 2009, is poised to run out of money by early 2025. That could leave EU taxpayers on the hook for €310 million.
At a closed-door meeting on Monday, the most senior EU lawmakers in charge of the institution’s finances agreed to slash payouts to beneficiaries by 50 percent, raise the eligible age from 65 to 67, freeze the annual inflation-linked increase of payments and invite more beneficiaries to accept a sweet one-time offer to quit the scheme.
The European parliamentarians assembled in the so-called Bureau cast their decision based on two options presented to them in a document, seen by POLITICO, which was prepared by Secretary General Alessandro Chiocchetti.
“They had a discussion and it was clear where the majority was,” said a person with knowledge of the meeting, who spoke on condition of anonymity to freely discuss the private conversation.
The move taken Monday will likely extend the life of the fund until the second half of 2027 and reduce the €310 million black hole to some €86 million. It punts any final decision on whether to let the scheme go bust or bail it out with taxpayer money until after the EU election in 2024.
The Bureau rejected a second option, described in the document as less legally risky but also “less far-reaching,” which would only have slashed the payouts in half and frozen the indexation.
Chiocchetti’s document stopped short of pulling the plug on the scheme entirely. Hovering over any decisions the Bureau makes is the threat of legal action from beneficiaries, who have already initiated a decade’s worth of litigation against previous attempts by the Parliament to tighten up the scheme.
According to Chiocchetti’s note, the option finally chosen is a mid-level legal risk that would be legally defensible — though this still carries a possibility that the Court of Justice of the EU could annul it.
Green Vice-President of the Parliament Heidi Hautala said in a statement that the fund should have been “wound up years ago,” and called on commissioners such as top diplomat Josep Borrell to voluntarily withdraw from the scheme.
She wrote: “Letting the fund go bust should not be off the table either. Legal opinions on the Parliament’s liability differ, and in the end, the matter could be tested in the courts.” Hautala added that measures now taken will only prolong the fund for a few more years.
Chiocchetti’s note admits that the chosen solution is not definitive. It explains that taking calculated legal risks to reduce the deficit will “thus limit potential negative consequences on European taxpayers.”
Other MEPs leaving the room remained largely tight-lipped. Lawmakers from the center-right EPP group Rainer Wieland, Christophe Hansen and Anne Sander refused to comment.
Another MEP in the room was Roberts Zīle, a Latvian lawmaker from the right-wing ECR group who is signed up to the pension scheme. He said he had recused himself from the decision and denied he would take money from the scheme when he becomes eligible. “I will not be [a] pensioner of this fund,” he said.
Dimitrios Papadimoulis, a Greek MEP from the Left group who is another Bureau member and part of the scheme, also told POLITICO he has excluded himself from decision-making around it.
Similarly, a spokesperson for first vice president of the Parliament, Othmar Karas, wrote to POLITICO that Karas has “not participated,” and that the Austrian EPP member “has not received any money from the Voluntary Pension Fund.”
