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Decision of the European Ombudsman on complaint 2132/2003/GG against the European Parliament


Strasbourg, 29 March 2004

Dear Mr X.,

On 8 November 2003, you submitted a complaint against the European Parliament to me concerning the transfer of pension rights acquired by you in Germany and Belgium to the Community pension scheme. On 17 November 2003, you forwarded a number of supporting documents to me.

On 26 November 2003, I forwarded the complaint to the President of the European Parliament. Parliament sent its opinion on 13 January 2004. I forwarded it to you on 19 January 2004 with an invitation to make observations, which you sent on 19 February 2004.

I am writing now to let you know the results of the inquiries that have been made.


THE COMPLAINT

The complainant is a retired civil servant of the European Parliament. Before joining the civil service of the EU, the complainant had worked for other employers in Germany and Belgium and acquired pension rights there.

Article 11 (2) of Annex VIII (“Pension scheme”) of the Staff Regulations provides as follows:

“An official who enters the service of the Communities after:

- leaving the service of a government administration or of a national or international organization; or

- pursuing an activity in an employed or self-employed capacity;

shall be entitled upon establishment to have paid to the Communities either the actuarial equivalent or the flat-rate redemption value of retirement pension rights acquired by virtue of such service or activities.

In such case the institution in which the official serves shall, taking into account his grade on establishment, determine the number of years of pensionable service with which he shall be credited under its own pension scheme in respect of the former period of service, on the basis of the amount of the actuarial equivalent or sums repaid as aforesaid.”

It appears that according to the implementing provisions established by Parliament (and the implementing provisions established by other Community institutions and bodies), the number of the years that can thus be credited cannot exceed the number of years for which the person concerned was affiliated to a national pension scheme.

As a result, only part of the pension rights transferred to the Communities may thus be taken into account for calculating the pension due under the Community regime. For example, in the case of Mr Kristensen, one of the plaintiffs in the Kristensen case(1), pension rights arising from a transfer of national pension rights which would have amounted to the equivalent of more than 4 years and 5 months were thus reduced to the equivalent of 2 years and 8 months.

It emerges from the facts of the Kristensen case that the European Commission, the Court of Justice and the Court of Auditors return to the official concerned the part of the pension rights acquired under national law that is not used for the calculation of the pension under Community law. The Council and the European Parliament, however, did not return these amounts to the officials concerned but paid them into the budget of the European Communities until the judgement in the Kristensen case.

In its judgement in the Kristensen case, the Court held that the national pension rights that had been transferred to the Community scheme, but which could not be taken into account for the purposes of the latter, belonged to the civil servant and had to be reimbursed to the latter(2).

The complainant agreed to transfer his pension rights acquired in Germany and Belgium to the Community scheme in 1996.

On 1 January 2003, the complainant retired from Parliament’s service. His pension rights were fixed by a decision adopted by Parliament on 17 December 2002. According to this decision, his years of work at the European Parliament(3) and the pension rights that he had acquired in Germany and Belgium and that had been transferred to the Community resulted in a theoretical pension amounting to 72,83333 % of his last basic salary. Taking into account the uprating for the 1 year and 11 months the complainant had continued to work after he had reached the age of 60, his theoretical pension was increased to 79,44583 % of his last basic salary. However, given that the maximum retirement pension amounts to 70 % of the last basic salary of the official(4), the complainant’s pension was reduced to this amount.

In March 2003, the complainant became aware of the judgement in the Kristensen case. He thereupon lodged a complaint pursuant to Article 90 (2) of the Staff Regulations against Parliament’s decision determining his pension rights. In his complaint, the complainant took the view that of the equivalent of 11 years and 5 months that had been transferred from the German and Belgian pension schemes, the equivalent of 4 years and 3 months should be returned to him. This complaint was rejected by Parliament on 6 August 2003.

In his complaint to the Ombudsman, the complainant objected to Parliament’s decision of 17 December 2002 determining his pension rights. He alleged that the European Parliament had failed to provide him with complete and correct information so as to enable him to assess the meaning of the agreement he had given to the transfer of his pension rights. According to the complainant, this lack of information constituted negligence or even a misuse of powers on the part of Parliament.

The complainant submitted that given the highly specialised nature of the subject, he had asked for the transfer, putting his trust entirely in the administration and without being able to evaluate the consequences.

The complainant asked for compensation consisting of the reimbursement of the excess sums that had been transferred and that Parliament had obtained and/or of that part of the Belgian pension which Parliament received in excess from the Belgian Pension Office.

The complainant also queried why in two documents drawn up by Parliament in 1999 and 2000 respectively and informing him about his pension rights, differing amounts had been given as to the pension rights that had been transferred.

THE INQUIRY

The European Parliament's opinion

In its opinion, the European Parliament made the following comments:

On the need to apply the Kristensen case

The Kristensen case concerned a different situation. In this case, the Court had to deal with the question as to whether the number of years of pensionable service calculated on the basis of national pension rights could be limited to the number of years the official had actually worked in the Member States concerned (“plafonnement”). This issue did not arise in the present case. In accordance with the decision of 18 June 1996, the equivalent of 11 years and 5 months had effectively been transferred and taken into account for calculating the pension under the Community regime.

The limitation of the pension to 70% of the last basic salary in accordance with Article 77 of the Staff Regulations was applicable to all officials, regardless of whether they had transferred previous pension rights or whether they had acquired all their pension rights under the Community scheme.

Negligence, errors and misuse of powers

On 18 June 1996, the complainant had agreed to transfer the pension rights he had acquired in Germany and Belgium to the Community scheme. The administration’s duty to consider the interests of the official was limited by the need to respect the rules in force. However, the Staff Regulations clearly limited the pension to a maximum of 70 % of the last basic salary.

On the other hand, the table annexed to the proposal to transfer the Belgian pension rights showed that after this transfer was carried out, the maximum amount of the pension (70 %) would already be attained at the age of 60 years. It would have been possible for the complainant to ask the Pensions Service of Parliament to calculate the redundant annuities and not to transfer them to the Community scheme.

It could hardly be denied that when preparing the documents necessary for the transfer of his pension rights, the complainant had necessarily been in close contact with the relevant services and could have asked for any information that he might have needed.

The inconsistency between the two documents provided to the complainant for his information in 1999 and 2000 was due to a deplorable error. However, this error did not in any way affect the correctness of Parliament’s decision determining the complainant’s pension rights that was adopted in December 2002 and communicated to him in January 2003. Moreover, the limitation of the pension to a maximum of 70 % of the last basic salary was mentioned on both documents. The complainant nevertheless did not contact the relevant services in order to ask for explanations.

It should further be noted that the complainant retired at the age of 61 years and 11 months, not at the age of 60, and that he never asked the administration as to the consequences of this extension of the period of contributing to the pension scheme.

As to the alleged misuse of powers, the complainant had not shown, as required by the case-law of the Community courts(5), on the basis of objective and consistent evidence, that the decision had been taken for purposes other than those stated.

On the basis of the above, Parliament submitted that it had correctly applied the rules in force and not committed negligence, error or misuse of powers.

Together with its opinion, Parliament submitted a number of supporting documents, including a copy of a letter addressed to the BfA (Bundesversicherungsanstalt für Angestellte, the German Pension Office) and dated 4 June 1996. This letter, which was signed by the complainant on 18 June 1996, contains a declaration according to which the undersigned declares that he/she either (a) definitively renounces the possibility of a transfer or (b) agrees to the transfer of the national pension rights to the Community scheme. The second of these possibilities was indicated on the document of which Parliament submitted a copy.

The complainant's observations

In his observations, the complainant made the following comments:

The specific and complicated nature of the subject had only gradually allowed him to find out about the problems he was facing. It had been precisely the inconsistency of the information he had received from Parliament that had made it difficult for him to evaluate the matter.

Upon having obtained further and more precise information, it was correct to say that the judgement in the Kristensen case was not applicable to the present case.

It emerged from an examination of the documents in his possession that he had omitted to indicate one of the two possibilities mentioned in the letter to the BfA of 4 June 1996. Parliament’s services appeared to have corrected this omission by ticking the second possibility. The Ombudsman was requested to verify this by comparing the copy of the letter the complainant had already submitted to him. Although Parliament indubitably had acted in good faith, this fact constituted an evident procedural defect which rendered void the whole transfer of the German pension rights. The BfA would be informed accordingly.

THE DECISION

1 Failure to provide complete and correct information

1.1 The complainant is a retired civil servant of the European Parliament. Before joining the civil service of the EU, the complainant had worked for other employers in Germany and Belgium and acquired pension rights there. In 1996, the complainant accepted that these pension rights should be transferred to the Community pension scheme. As a result of this transfer, the complainant had already attained the maximum pension allowable under the Staff Regulations (70 % of the last basic salary) at the age of 60 years. However, the complainant only retired at the age of 61 years and 11 months at the end of 2002. Although he receives the maximum pension allowable under the Staff Regulations, he would have been in a better financial position if only part of the pension rights he had acquired in Germany and Belgium had been transferred to the Community scheme.

1.2 The complainant alleged that the European Parliament had failed to provide him with complete and correct information so as to enable him to assess the meaning of the agreement he had given to the transfer of his pension rights. He submitted that given the highly specialised nature of the subject, he had asked for the transfer, putting his trust entirely in the administration and without being able to evaluate the consequences. According to the complainant, the lack of complete and correct information constituted negligence or even a misuse of powers on the part of Parliament. The complainant also pointed to an inconsistency between two documents that Parliament had provided to him for his information in 1999 and 2000.

1.3 In its opinion, Parliament submitted that it had correctly applied the rules in force and not committed negligence, error or misuse of powers. Parliament took the view that the administration’s duty to consider the interests of the official was limited by the need to respect the rules in force and stressed that the Staff Regulations clearly limit the pension to a maximum of 70 % of the last basic salary. It pointed out that the table annexed to the proposal to transfer the Belgian pension rights had indicated that after this transfer was carried out, the maximum amount of the pension (70 %) would already be attained at the age of 60 years. In Parliament’s view, it could hardly be denied that when preparing the documents necessary for the transfer of his pension rights, the complainant had necessarily been in close contact with the relevant services and could have asked for any information that he might have needed. Parliament admitted that there was an inconsistency between the two documents provided to the complainant in 1999 and 2000 and submitted that this was due to a deplorable error. According to Parliament, however, this error did not in any way affect the correctness of Parliament’s decision determining the complainant’s pension rights that had been adopted in December 2002 and communicated to him in January 2003.

1.4 The Ombudsman considers that two preliminary remarks should be made. First, in his complaint, the complainant sought to rely on the judgement of the Court of First Instance in the Kristensen case(6). In its opinion, Parliament disputed the relevance of this case for the present complaint, and in his observations the complainant accepted that the said judgement does not apply to his case. Second, the Ombudsman notes that Article 77 of the Staff Regulations provides that the maximum pension that can be granted under the Community pension scheme amounts to 70% of the last basic salary. Given that this is the amount awarded to the complainant in Parliament’s decision of 17 December 2002, it is obvious that the complainant does not attack this decision as such, but the preceding transfer of (part of) the pension rights he had acquired in Germany and Belgium.

1.5 Such transfers are governed by Article 11 (2) of Annex VIII (“Pension scheme”) of the Staff Regulations. The Ombudsman agrees that the relevant provisions and the way in which they are implemented are not easy to understand for those who do not specialise in this area. It is therefore important that the administration should provide sufficient information to the official to allow him or her to grasp the significance and the consequences of such a transfer. However, regard also needs to be had to the fact that such a transfer is only carried out with the consent of the official concerned. Officials can therefore be expected to ask the administration for further and more specific information, if the information that is available is not sufficient to clarify all issues.

1.6 In the present case, the Ombudsman notes that the table annexed to the proposal to transfer the Belgian pension rights indicated that after this transfer was carried out, the maximum amount of the pension (70 %) would already be attained at the age of 60 years. The relevant information immediately precedes the signatures of the persons in charge at the European Parliament and of the complainant himself. The fact that the maximum amount of pension that could be granted to the complainant under the Community pension scheme was 70 % of his last basic salary is laid down in Article 77 of the Staff Regulations. It was also mentioned in the two information documents that the complainant obtained from Parliament in 1999 and 2000. Whilst it is deplorable that some of the other figures in these documents differed slightly, the fact remains that the complainant could be under no doubt that he would not receive a pension exceeding 70 % of his last basic salary, even if he carried on working beyond the age of 60. The Ombudsman considers that in these circumstances, Parliament could reasonably have expected the complainant to ask its services for information and for advice before agreeing to the transfer of his national pension rights if he had any doubts or queries.

1.7 In his observations on Parliament’s opinion, the complainant submitted that there was an evident procedural defect which rendered void the whole transfer of the German pension rights. To support his view, the complainant referred to the letter addressed to the BfA (Bundesversicherungsanstalt für Angestellte, the German Pension Office) and dated 4 June 1996 in which the complainant declared that he agreed to the transfer of the German pension rights to the Community scheme. According to the complainant, the relevant box had been ticked not by him, but by Parliament’s services. The Ombudsman notes, however, that the complainant does not question Parliament’s good faith, nor does he dispute that he signed the relevant letter and also approved and signed a note drawn up by Parliament which specified the time and the amount of the relevant transfer. Moreover, even if the complainant’s view that the whole transfer was null and void were accepted, the probable consequence would be that the complainant could still claim his German pension from the BfA.

1.8 In these circumstances, the Ombudsman considers that there appears to be no maladministration on the part of the European Parliament. There is thus no need to carry out the further inquiries suggested by the complainant in his observations, nor to deal with the claims which the complainant raised on the basis of his allegation that there was maladministration.

2 Conclusion

On the basis of the Ombudsman's inquiries into this complaint, there appears to have been no maladministration by the European Parliament. The Ombudsman therefore closes the case.

The President of the European Parliament will also be informed of this decision.

Yours sincerely,

 

P. Nikiforos DIAMANDOUROS


(1) Joined Cases T-103/98, T-104/98, T-107/98, T-113/98 and T-118/98 Kristensen and others v Council [1999] ECR SC I-A-215, II-1111.

(2) Loc. cit., paragraphs 40-45.

(3) According to Article 77 of the Staff Regulations and Article 2 of Annex VIII of the Staff Regulations, the pension is calculated on the basis on the total number of years of pensionable service acquired by the official, with a maximum of 35 years. The maximum retirement pension shall be 70 % of the final basic salary.

(4) See preceding footnote.

(5) See, for example, joined Cases T-33/89 and T-74/89 Blackman v Parliament [1993] ECR II-249 paragraph 54.

(6) Joined Cases T-103/98, T-104/98, T-107/98, T-113/98 and T-118/98 Kristensen and others v Council [1999] ECR SC I-A-215, II-1111.