Pension for MEPs at 63:
But how can it be financed?
MB – 05/2023
The pension scheme for Members of the European
Parliament (MEPs) is under criticism and the issue at stake is an entitlement
to a supplementary pension from the pension fund. The problem: the fund is on
the brink of bankruptcy.
Reforms everywhere - only the European Parliament is static
While everywhere in the EU the course for
longer working lives is being discussed and implemented - we think of the
current situation in France - the European Parliament (EP) and its members are not affected. Since
2009, there has been a uniform EU pension system for MEPs, and to date, the
retirement age is 63
years of age. The costs of their pensions are paid from the EP's budget and
thus, by European taxpayers.
The supplementary pension scheme is on the brink of bankruptcy
Before 2009, this did not exist and MEPs rather
received a pension according to the regulations governing their states of
origin. In 1989/1990, the EP had therefore established a voluntary pension fund
because not all members had a pension entitlement through the national
parliaments. MEPs were able to acquire old-age and survivors' pension rights
through their own contributions and subsidies from the EP. The pension fund was
closed in 2009 following a reform of the Statute for Members of the European
Parliament. For those who were already members of the fund in 2009, it remained
open unless they opted for the new system.
The pension fund is on the brink of bankruptcy:
as early as summer 2018, the German
about the imminent bankruptcy of the fund in 2024. According to current
reports, insolvency is imminent in the coming years because current and future
obligations exceed the existing fund capital many times over.
The reason for this is, on the one hand, the
difficult situation on the capital market and wrong decisions in the past. But
the MEPs themselves have also contributed to this: Raising the retirement age
from 63 to 65 did not gain majority support in 2018. In the current discussion,
which EP President Roberta Metsola (EPP/ ML) wants to hold in the Steering
Committee in the near future, other solutions are being sought. The options now
being discussed are probably insolvency (cessation of payments to
beneficiaries), liquidation of the fund (payment of the remaining funds to the
fund members) or a transfer of the fund or, better, of the liabilities to the
German MEPs only slightly affected
Currently, there are probably only a few former
German MEPs with vested rights in the fund. All incumbent German MEPs are in
the new pension system and thus, unaffected by a bankruptcy. Unlike Members
of the German Parliament (Bundestag), for whom the retirement age is gradually being
raised from 65 to 67, the age limit of 63 continues to apply to MEPs.