The European Parliament adopted by a comfortable majority (409 votes for, 89 against with 92 abstentions) the report of Giuseppe GARGANI (EPP/ED, Italy) on the Statute for Members of the European Parliament. (Please see the summary of 15/06/2005.) The main points are as follows:

- From the first day of the European Parliament parliamentary term in 2009, Members will receive a monthly salary of EUR 7000 with expenses reimbursed on the basis of receipts.

- Parliament will reimburse the actual expenses incurred by Members in travelling to and from the places of work and in connection with other duty travel. Others expenses incurred by Members in the exercise of their mandate may be reimbursed by means of a flat-rate sum, which will be decided by Parliament.

- Each Member State may adopt, for the Members elected in it, rules different from the provisions of the Statute as regards the salary, transitional allowance and pensions for a transitional period until 2019. Those rules must place the Members on at least an equal footing with the members of their respective national parliament, with payments being made from the budget of the Member State in question.

- With the new system, Members will be remunerated from the European budget, and will pay Community tax, as do civil servants working in the European Institutions. However, this is without prejudice to the Member States' power to make the salary subject to national tax law provisions, provided that any double taxation is avoided. Member States have the right to take the salary into account when setting the rate of taxation applicable to other revenue. These tax arrangements are also applicable to the transitional allowance as well as to some parts of the old-age, invalidity and survivor's pensions.

- There are additional provisions on the voluntary pension fund set up by Parliament maintained after the entry into force of the Statute for Members who have already acquired rights or future entitlements in that fund. Acquired rights and future entitlements will be maintained in full. Parliament may lay down criteria and conditions governing the acquisition of new rights or entitlements. However, Members who receive the salary as laid down in this Statute will not be allowed to acquire any new rights or future entitlements in the voluntary pension fund, and it will not be open to Members who are first elected to Parliament in 2009.

- The statute also brings in a common regime for retirement. Former Members will be entitled to an old-age pension from the age of 63. This pension will be, for each full year's exercise of a mandate, 3.5% of the salary plus one-twelfth for each further full month, but not more than 70% in total.

- At the end of their term of office Members will be entitled to a transitional allowance equivalent to their salary, which entitlement will continue for one month per year in which their mandate has been exercised, but not for less than six months or more than 24 months.

- The Stature also makes provision for invalidity and survivor's pensions, which are funded from the general budget of the European Union, and, like the salary and pension, are subject to tax for the benefit of the Communities.

The European Parliament adopted by a comfortable majority (409 votes for, 89 against with 92 abstentions) the report of Giuseppe GARGANI (EPP/ED, Italy) on the Statute for Members of the European Parliament. (Please see the summary of 15/06/2005.) The main points are as follows:

- From the first day of the European Parliament parliamentary term in 2009, Members will receive a monthly salary of EUR 7000 with expenses reimbursed on the basis of receipts.

- Parliament will reimburse the actual expenses incurred by Members in travelling to and from the places of work and in connection with other duty travel. Others expenses incurred by Members in the exercise of their mandate may be reimbursed by means of a flat-rate sum, which will be decided by Parliament.

- Each Member State may adopt, for the Members elected in it, rules different from the provisions of the Statute as regards the salary, transitional allowance and pensions for a transitional period until 2019. Those rules must place the Members on at least an equal footing with the members of their respective national parliament, with payments being made from the budget of the Member State in question.

- With the new system, Members will be remunerated from the European budget, and will pay Community tax, as do civil servants working in the European Institutions. However, this is without prejudice to the Member States' power to make the salary subject to national tax law provisions, provided that any double taxation is avoided. Member States have the right to take the salary into account when setting the rate of taxation applicable to other revenue. These tax arrangements are also applicable to the transitional allowance as well as to some parts of the old-age, invalidity and survivor's pensions.

- There are additional provisions on the voluntary pension fund set up by Parliament maintained after the entry into force of the Statute for Members who have already acquired rights or future entitlements in that fund. Acquired rights and future entitlements will be maintained in full. Parliament may lay down criteria and conditions governing the acquisition of new rights or entitlements. However, Members who receive the salary as laid down in this Statute will not be allowed to acquire any new rights or future entitlements in the voluntary pension fund, and it will not be open to Members who are first elected to Parliament in 2009.

- The statute also brings in a common regime for retirement. Former Members will be entitled to an old-age pension from the age of 63. This pension will be, for each full year's exercise of a mandate, 3.5% of the salary plus one-twelfth for each further full month, but not more than 70% in total.

- At the end of their term of office Members will be entitled to a transitional allowance equivalent to their salary, which entitlement will continue for one month per year in which their mandate has been exercised, but not for less than six months or more than 24 months.

- The Stature also makes provision for invalidity and survivor's pensions, which are funded from the general budget of the European Union, and, like the salary and pension, are subject to tax for the benefit of the Communities.

The committee adopted the own-initiative report by its chairman, Giuseppe GARGANI (EPP-ED, IT), on amending the decision of 4 June 2003 on the adoption of the Statute for Members of the European Parliament. MEPs in the committee supported the compromise proposed by the Council.

Under the proposed agreement, the monthly salary for all MEPs would be fixed at 38.5% of the basic salary of a judge at the Court of Justice (i.e. EUR 7 000). This would put an end to the pay disparities between Members, who currently receive the same salaries as members of their national parliaments. Under the new system, MEPs' salaries would be paid by the EU. They would pay income tax to the EU budget, though Member States also retain the option to apply in addition taxation up to the level of national rates.

The agreement provides for a transition period during which each Member State may continue to apply, for the Members elected by its citizens, rules different from the provisions of the Statute.

Upon introduction of the Statute, travel expenses would no longer be refunded on a flat-rate basis. Instead, all MEPs would have their expenses reimbursed on the basis of actual costs incurred, thus improving transparency. Members would enter a common pension scheme, with contributions paid by Parliament.

In its report, the committee called for "a separate and independent examination of that part of the Statute which falls under secondary law and of that part which falls under primary law, and approval of both parts in accordance with the institutional provisions applicable to each of them". It pointed out that, regarding the part which falls under primary law, Member States should review the 1965 Protocol on the privileges and immunities of the European Communities in respect of the provisions relating to MEPs, "taking the Statute approved on 3 and 4 June 2003 as a model".