Life after the Commission: lobbying contracts and a million-euro pension

Transparency campaigners have decried the “unacceptable revolving doors” that allow former EU commissioners and commission staff to join the private sector in roles that serve to influence the portfolios they previously acted as guardians for.

News that public relations multinational Fipra had engaged the “EU’s maritime department lock, stock and barrel”, the EUObserver reported, gave a glimpse into the lucrative future of anybody who lands himself the plum job of EU Commissioner.

Former EU Commissioner responsible for fisheries Joe Borg, has now joined Fipra, along with former Commission colleague John Richardson, who works as a maritime policy and diplomacy special advisor. According to the EUobserver, a total so far of six of the 13 EU commissioners who retired this year have now gone on to work for banks, lobbying firms, insurance companies and airlines – an example being former transport Commissioner Charlie McCreevy’s recent appointment to the board of Ryanair.

In the meantime, Commissioners have one of the most well-paid transitional allowances when they leave their Brussels jobs and start ‘adjusting’ to new career paths: Borg himself enjoys a taxable allowance that ranges between 40-65% of his €238,000 salary, for the next three years. This portion is however capped: his new Fipra salary, together with the allowance, cannot exceed the remuneration of a commissioner.

This is part of a formidable ‘milion-euro’ pension he can receive over his lifetime, according to research from British think-tank Open Europe. Upon leaving office, Borg was entitled to a resettlement allowance of €19,909 – what is in effect one month’s salary for Commissioners. His travel expenses and moving costs back to Malta from Brussels should have also been reimbursed.

Apart from his transitional allowance, Borg, 58, will be entitled to a life pension upon reaching 65, which will also be subject to Community tax. The annual pension will be of €51,068. By the age of 81, Borg will have earned €852,851 in pension payments apart from his resettlement and transitional allowances, which bring the total close to some €1.2-€1.4 million.

Pension rights depend on the length of a Commissioner’s term in office and amounts are calculated as 4.275% of the basic salary for every full year in office, but must not exceed 70% of the final basic salary. A Commissioner’s salary is also subject to Community tax. Borg also received an annual residence allowance of €35,837 (15% of his salary), and an annual entertainment allowance of €7,284.
In total, the Commissioner earned a gross €1,410,204 salary over the past five years.

In total, the former team of 27 Commissioners headed by President Jose Barroso has cost some €76 million in this five-year term – including salaries, pensions, and the various allowances. This does not include other perks that Commissioners receive during their service, such as family allowances and subsistence allowances. The pension costs alone amount to more than €36 million.