how many people are employed by the European Union institutions; and what assessment they have made of how many of those individuals pay either no tax or reduced tax rates on their remuneration.Lord Wallace of Saltaire responded on behalf of HMG:
My Lords, the European Union institutions all together employ approximately 55,000 people. EU staff are exempt from national income tax, a similar situation to that found in other international bodies. As in other international bodies, the EU deducts a proportion of salary as a form of extranational taxation, proceeds from which are returned to the EU budget. This is applied progressively, rising from an initial 8% to a 45% marginal rate for the highest-paid. In addition, there is now a special or solidarity levy, which last month was increased from a top rate of 5.5% to 6%; most officials pay an average of 2%. I should declare an interest. My wife was for five years the director of the Robert Schuman Centre in Florence, whose staff regulations were those of the European institutions. We have examined her payslips and established that an average of 28% of her gross salary was deducted in community tax each month.To the suggestion that civil servants who work for the EU should be taxed at the home rate back home he went into a long discourse about international organizations, residency and non-residency. The next topic raised, by Lord Tomlinson, was an old and tired one and shows that some of our politicos cannot or will not understand how the EU works.
Is the Minister as surprised as I am by the low number of European Union institution employees? How does that figure-I think he said 55,000-compare with a large-scale local authority in the United Kingdom?The response was:
My Lords, the figures I have are that Paris employs 50,000 people and Birmingham employs 60,000 people, so it is a relatively modest number.That merely proves that local authorities employ far too many people and some very severe pruning is needed. There is, also the point, rarely raised at times like this that those employees of local councils (and of many other organizations, public and private) spend much of their time implementing EU regulations. However, Lord Wallace went on:
I am sure the noble Lord will admit that the inefficiencies of the Commission-in particular, the rather inadequate personnel policies, the relatively generous allowances and an expatriate allowance which, unlike the NATO expatriate allowance, does not phase out after a number of years and is rather more generous-are things that we should be looking at, particularly when all national budgets within the European Union are being squeezed.Uh-huh! Well, good luck with that. It would appear that quite a few people, not just the usual suspects are troubled by the expensive nature of the project. Lord Dobbs asked:Will my noble friend help a confused man who has trouble with numbers? We have one
European Union which has two parliaments, three presidents and dozens of employees who earn more than our Prime Minister. I understand that the second parliament in Strasbourg, over the course of the parliamentary cycle, costs our taxpayers €1.5 billion. Do any of those statistics make any sense to him?Apparently, we all keep campaigning for abolishing the Strasbourg part of the merry-go-round but, so far, with no success whatsoever. That has something to do with the fact that the Strasbourg week was written into the Treaty of Amsterdam and has remained in the subsequent ones. Nobody noticed at the time and nobody is going to be able to change without re-writing the treaties.
That was the last moment of serious or semi-serious (can anything that involves the European Parliament be called serious?) discussion. The following two farcical exchanges took place:
Lord Pearson of Rannoch: My Lords, what is the average annual cost to the taxpayer of Members of your Lordships' House and what is the average annual cost to the taxpayer of Members of the European Parliament, including all the latter's special perks and allowances?One cannot help longing for the days of Lord Bruce of Donington. After an exchange like this he would invariably rumble to his feet and ask whether the noble Minister was aware that he had the figures that the Minister apparently did not. Alas, who is there to replace the great Lord Bruce? Incidentally, he it was who demanded information about the nascent EU diplomatic service and the money that was spent on it, long before its existence was acknowledged.
Lord Wallace of Saltaire: My Lords, it may surprise the noble Lord, but I do not have the exact figures to hand. Of course, any international parliament costs a great deal more because of the travel, dual residence and so on that are involved. Members of this House who also attend the Parliamentary Assembly of the Council of Europe or the NATO Assembly also cost rather more than the rest of us.
Lord Howell of Guildford: Does my noble friend have any figures on the European External Action Service? Has he noticed recent criticism that it is not performing very effectively? Does he have any measure of cost versus performance for that body?
Lord Wallace of Saltaire: My Lords, I do not have that. The European External Action Service is still very much in its early stages. It is now performing rather better than when it was originally established. Multinational operations take longer to get going than others-I am looking at various people here who have served in the European Commission-and have a level of built-in efficiency.