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Malta

Malta – European MEP's – Wow what Salary Package

No wonder our dedicted ‘Servants’ fight a hard battle to represent us tax payers in the EU, look at their Salary and benefits package that they get, while the rest of the population struggles to make ends meet and the ever growing Government induced expenses.Read the following:

  43 Old Queen Street, London SW1H 9JA

http://www.taxpayersalliance.com

 

 

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http://www.taxpayersalliance.com

FOR IMMEDIATE RELEASE

RESEARCH NOTE 47

‘THE GREAT EUROPEAN RIP-OFF’

A BACKGROUND NOTE EXPLAINING HOW AN

MEP CAN BECOME A MILLIONAIRE IN JUST

ONE 5-YEAR TERM AT THE EUROPEAN

PARLIAMENT

The Great European Rip-Off:

 

How the corrupt wasteful EU is taking

control of our lives

 

by David Craig and Matthew Elliott will be published by

Random House on 5 March 2009.

In the book we calculate that any MEP can easily save over £1 million from

their expenses and pension benefits from just one 5-year term at the

European Parliament.

At the same time, a British MEP will get a salary of £63,291 a year (£316,455

over 5 years). However, in our calculations we have assumed MEPs will spend

all this £316,455 on their and their families’ living costs and so have not

included MEPs’ salaries in our estimates of how MEPs can become millionaires

in just 5 years.

This note uses an exchange rate of €1:80p, which is the 2008 average rate.

This is more conservative than the rate used in the book, of £1:€1.1 and

shows that the result is robust to different exchange rate assumptions. If the

calculations were carried out using today’s exchange rates the estimate of the

amount an MEP could save, in pounds, would be much higher.

Summary of how much an MEP can save (excluding salary):

 

Item Saved over 5 years

1 Subsistence Allowance €117,000

2 Assistants’ Allowance €489,840

3 Office Expenses €243,120

4 Travel Expenses €60,000

Total €909,960

Total in £ at €1 = £0.80 £727,968

Value of accrued pension £350,000

Total savings in one 5-year term £1,077,968

43 Old Queen Street, London SW1H 9JA

1. Salary

Currently a British MEP is paid the same as a Westminster MP – £63,291.

Paying British income taxes, depending on their family circumstances a British

MEP will pay about £16,456 income tax (26 per cent), leaving the MEP about

£46,835 to take home. After the June 2009 European Parliament, all MEPs

from all countries will be paid the same – at least €7,665 a month (€91,980 a

year). On this they will typically (again depending on family circumstances)

pay a special European Union tax of €13,797 (15 per cent) leaving them a

take-home pay of €78,183.

With an exchange rate of €1 = £0.80 this would raise a British MEP’s total

salary after June 2009 to £73,584 (a rise of 16 per cent) and give an increase

in take-home pay from £46,835 to £62,546 (a rise of 33 per cent). However,

the exchange rate has also moved in their favour since 2008. If exchange

rates remain at around €1:88p then their take home pay will increase to

£68,801. That will mean that a combination of the pay rise, more favourable

tax treatment and the change in the exchange rate leave MEPs with a 47 per

cent rise in their take home pay.

In calculating how any MEP can become a millionaire in just one 5-year term

at the European Parliament, we have assumed that MEPs spend all their

salaries on their day-to-day living expenses and so have not included any

money from salaries in the calculation.

2. Subsistence Allowance

For each day an MEP signs in, they can claim a Subsistence Allowance of

€287 tax free. British MEPs call this the SOSO (sign on and sod off)

allowance, because all you have to do to get it is to sign in. There is no

requirement to attend a single debate or committee session. What you do for

the rest of the day is up to you. Assuming an MEP signs in four days a week

for forty weeks, they will get €1,148 a week – €45,920 a year (nb about 70

MEPs each week also sign in on a Friday to get the subsistence allowance

before going home for the weekend).

A few years ago, some MEPs slept in their offices in order to avoid paying for

hotels so they could save more of their subsistence money. This is now

discouraged by the parliamentary authorities. However, a reasonable 3-star

hotel close to the European Parliament buildings will cost less than €125 a

night including breakfast, leaving over €162 a day for lunch and dinner. But,

any MEP signing in for 4 days a week will only spend 3 nights (Monday,

Tuesday and Wednesday) in a Brussels hotel. Likewise an MEP signing in for 5

days a week will only spend 4 nights in a hotel.

 

 

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There are subsidised restaurants in the European Parliament buildings and on

many days there are free breakfasts, lunches and dinners organised by

lobbying groups and political parties. In the evenings these typically serve

almost unlimited quantities of champagne and other drinks and expensive

canapés of smoked salmon, caviar, patés and other delicacies. One MEP

recently complained, “In these times of economic crisis what image are we

portraying? Every corner of the parliament is filled with receptions and buffet

dinners, while our constituents are being thrown out of their homes, losing

their jobs or having difficulty paying their food and energy bills.” Moreover,

there are over 15,000 lobbyists in Brussels all keen to wine and dine MEPs in

order to advance the interests of their paymasters.

If we assume that MEPs are paying about €60 each a day three days a week

for lunch and dinner (in reality, it is probably much less) and staying in a

hotel 3 nights a week at €125 a night, each MEP can pocket about €585 each

4-day week tax free from their subsistence allowance. Over 40 weeks this

gives them around €23,400 a year tax-free. Over one 5-year term this adds

up to €117,000 tax free.

3. Assistants’ Allowances

The biggest pot of money MEPs can dip into is for employing staff. Currently

this stands at about €202,968 per MEP per year. This allowance has increased

by an inflation-busting 34 per cent in the last five years. There are no

guidelines regulating how much an assistant should be paid, and MEPs are

permitted to pay a large portion of their allowance to just one person. Some

even do this, creating the absurd situation where MEPs’ assistants are

apparently paid much more than the MEPs for whom they work. There are

even cases where up to eight MEPs will share the services of one or two

assistants, potentially allowing each of them to make massive profits from

claiming the full Assistants’ Allowance.

Many MEPs use this allowance to pay members of their own family. The

amount is so generous that an MEP can easily afford to slip their partner or

offspring €50,000 to €60,000 a year for the occasional helping hand and still

have enough loose change to employ more than one full-time secretary and a

few researchers. Some MEPs dispense with the formality of handing the cash

to a family member and just pay some of it to themselves. The Galvin Report

uncovered widespread abuse of the Assistants’ Allowances including cases

where MEPs claimed they had given their assistants annual bonuses of up to

19 times the assistants’ monthly salaries – curiously these bonuses often

seemed to be exactly the right amount to use up the whole of the MEPs’

annual Assistants’ Allowance.

If we assume that an MEP is employing one full-time secretary for about

€35,000 a year (including social security charges) and 2 research assistants

 

 

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each also on €35,000 a year, then this gives the MEP an annual salary bill of

€105,000. This leaves the MEP €97,968 which he or she can pay to members

of their family or just to themselves (usually via a paying agent company of

which they or family members are directors).

Over one 5-year term this adds up to €489,840 tax free.

4. Office Expenses

Each MEP is provided with two fully furnished, rent-free offices in the

European parliament building, one for themselves and one for their

secretaries and assistants.

However, they are also given an office allowance of €48,624 a year for having

an office in their constituency. Here too no receipts are required to get this

money. As one MEP said, ‘there is no need to present receipts for office

expenses and there’s no audit. You could use the allowance for any purpose

you like.’ Many MPs claim that their constituency office is in their own home.

This allows them to rent out a room in their homes to themselves, which they

pay for with EU taxpayers’ money. Some even just take all the money without

bothering to have a constituency office at all.

At €243,120 tax free over five years, this is probably a welcome addition to

many MEPs’ household budgets. In some EU countries it’s enough to buy a

home, or it could be used to pay for a nice holiday flat near the

Mediterranean.

5. Weekly Travel Expenses

In addition, MEPs get very generous travel expenses. They can claim weekly

flights from their constituencies. Here they do actually need to provide some

proof that they have travelled. However, they just have to submit the stub

from the boarding pass – they are not asked for any information about how

much they have paid for their ticket. They are then reimbursed for a fully

flexible economy class ticket, plus an extra payment for distance travelled of

over €100 for every 500 kilometres, all usually adding up to comfortably more

than a business class fare.

By buying cheap weekend return tickets or by travelling on budget airlines,

(Ryanair and Easyjet between them fly from Brussels to more than 40

European cities) many MEPs can rake in more than €300 a week tax free.

German MEPs living in Berlin, for example, could, according to one report,

make a profit of around €800 each time they travelled to Brussels and over

€1,000 for every trip to Strasbourg.

 

 

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If we assume an MEP is only making about €300 a week forty weeks a year,

this would give them a tax-free profit of €12,000 a year – €60,000 tax free

over one 5-year term

MEPs also get an annual travel allowance of €4,000 a year to go anywhere in

the world as long as this travel is connected with their work as an MEP. The

Caribbean and the Far East seem to be popular destinations, with one MEP

justifying a trip to exotic Thailand on the basis of a half-hour meeting at the

EU’s Bangkok offices. Perhaps the MEP wasn’t aware that he could have

considerably reduced the cost to the taxpayer and saved himself a lot of

unnecessary travelling time by making a conference call. However, here we

have assumed that MEPs do actually use their annual €4,000 travel allowance

and so have not included this money in the calculation of how much an MEP

can save.

6. Pensions

As our politicians preside over a worsening pensions crisis that will leave most

private-sector workers in poverty in their old age, they have made sure that

they have one of the best pensions schemes in Europe.

Typically, government employees across Europe would have to work for

around 40 years to get a pension worth about half their final salary. Politicians

in the British parliament have a much better deal and have to work for only

20 years to achieve an inflation-protected pension for them and their partner

of half their final salary. Any other British worker would have to pay about

£50,000 a year into their pension scheme to get similar benefits to their MPs.

Calculation for an MP:

Each year a Westminster MP works they accrue 1/40

 

of their final salary as

an inflation-linked pension. On the current salary of £63,291, this would be

worth £1,582 a year in pension. (By the time most MPs retire, their salary will

have increased, also increasing their pensions). With annuity rates for joint,

inflation-protected pensions currently around 3.5 per cent, this pension is

equivalent to an MP putting about £45,200 a year into their pension savings –

most only pay a tiny fraction of that, the taxpayer will pay the rest.

Calculation for an MEP:

For each year an MEP works, they accrue about 1/30

 

 

 of their final salary as

an inflation-linked pension. On the current salary of £63,291, this would be

worth about £2,110 a year in pension. (By the time most MEPs retire, their

salary will have increased, also increasing their pensions). With annuity rates

for joint, inflation-protected pensions currently around 3.5 per cent, this

pension is equivalent to an MEP putting about £60,285 a year into their

 

 

 

 

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pension savings – most only pay a tiny fraction of that, the taxpayer will pay

the rest.

After the June 2009 elections, with a salary of £73,584, each year a MEP

works will give an annual inflation-linked pension of about £2,450, equivalent

to putting £70,000 a year into their pension savings.

So, over a 5-year term, a British MEP’s pension savings would typically be

equivalent to the taxpayer making contributions of around £350,000.

In addition MEPs can save for an additional voluntary EU pension. For every

€1,000 they paid per month into their pension scheme, the EU would pay

double that amount. MEPs are allowed to pay this extra €1,000 from their

€48,624 office expenses. In theory, they are then supposed to reimburse this

money from their own bank accounts. However, everything relies on the

MEPs’ honesty. Unsurprisingly, a few years ago MEPs voted down a proposal

that EU parliament auditors should check whether any of them actually do

repay this money.

7. Summary

Adding all this up, a typical British, French or German MEP will be getting over

€460,000 a year in salary, pension and expenses – more than €2.3 million for

each five-year period in Brussels. With a bit of judicial financial management,

they can probably save as follows:

Item Saved over 5 years

1 Subsistence Allowance €117,000

2 Assistants’ Allowance €489,840

3 Office Expenses €243,120

4 Travel Expenses €60,000

 

Value of accrued pension £350,000

Total savings in one 5-year term £1,077,968

If you are the EU candidate for one of the main political parties, you have

about a one in three chance of scoring your EU millions – all in all, much

better odds than winning the EuroMillions lottery or else correctly answering

all the questions on

 

 

 

Who Wants to be a Millionaire?

8 Even More Benefits.

 

 

7

Even when MEPs lose their seats in the European parliament, they don’t have

to bid goodbye to the financial benefits immediately. Once they leave office

MEPs continue to enjoy a ‘transitional allowance’ (basically their parliamentary

salaries) for anything from six months to two years, depending on their length

of service. So for just 5 years at the Parliament, this would be worth a

minimum of over £30,000 to a British MEP. MEPs can also keep on using the

parliament’s subsidised restaurants and cafeterias, libraries and telephone

facilities in Brussels, Strasbourg and Luxembourg. Moreover, once they start

drawing their EU pensions, these are subject to special, low EU tax rates and

not the, usually much higher, tax rates in whichever country they may retire

to.

The benefits of being an MEP don’t stop here. MEPs also have a huge list of

other entitlements that are generously subsidised by Europe’s taxpayers. If

they take language and computer courses we pay their fees, travel and living

expenses. They have full, free accident insurance, travel insurance and life

assurance. They and their families get money for spectacles, contact lenses

and dental treatment. One British dentist pointed out that MEPs could claim

up to four times more for the cost of dental work than he could get for doing

that work under his National Health Service contract. MEPs and their families

can also get full payment for things like hydrotherapy, mud baths, aerosol

therapy and acupuncture.

 

 Dowload the leaked Galvin report:

http://freemediaproductions.newsvine.com/_news/2009/02/25/2474785-secret-report-shows-how-eu-parliament-members-pocketed-millions

 

March 13, 2009 - Posted by | Uncategorized

1 Comment »

  1. Hi this blog is great I will be recommending it to friends.

    Comment by watcat | March 17, 2009 | Reply


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