Ministers' Deputies / Rapporteur Groups
GR-AB
Rapporteur Group on Administrative and Budgetary Questions
GR-AB(2002)20 (restricted) 6 November 2002
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Co-ordinating Committee on Remuneration (CCR)
Remuneration of the Staff of the Co-ordinated Organisations: General Review -
139th report – Report by the CCR Chairman
Explanatory memorandum from the Secretary General
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The 139th report of the Co-ordinating Committee on Remuneration (CCR)
1. This report was submitted to the Ministers’ Deputies for their information in document CM (2002)138. The situation can be summarised as follows.
2. The 80th Report of the CCR sets out the procedure for adjusting the salaries of the staff of Council of Europe and the other Co-ordinated Organisations from 1 January 1998 until 31 December 2001. A revision of the adjustment procedure should have been approved during 2001.
3. However, on the recommendation of the CCR in its 127th Report, the period of application of the 80th Report was extended by one year until the end of 2002, in order to give the CCR more time to carry out the revision of the procedure. The salary adjustment procedure contained in the 80th Report will now therefore expire on 31 December 2002.
4. The CCR has failed to reach consensus on a recommendation to be made to the governing bodies of the Co-ordinated Organisations on a revised salary adjustment procedure to apply from 1 January 2003 to 31 December 2006.
5. As a consequence, the CCR Chairman has, under the terms of the Regulations concerning the Co-ordination system, been obliged to write his own report setting out the different views expressed in the CCR and the broad lines of consensus. He passes the unresolved issues to the governing bodies to decide upon individually.
6. In his cover note to the report, the CCR Chairman states that a consensus has been reached on the technical method by which salary adjustments will be calculated. Basically, the CCR recommends that the salaries of the staff of the Co-ordinated Organisations should continue to follow the development of net salaries paid to civil servants in the reference countries. The CCR was not, however, able to reach a consensus on provisions concerning Affordability, Studies and Flexible management of salary scales.
7. The CCR Chairman attaches as an Annex to his report the revised procedure comprising all those Articles on which national delegations have been able to reach consensus. On two Articles – Articles 10.4 (Studies) and 12 (Flexible management of salary scales) – he adds his own recommendations as Chairman.
8. The contentious articles are therefore:
- Article 10.4 on Studies in the private sector
- Article 12 on the Flexible management of salary scales
- Article 8 on the question of affordability.
9. It is my proposal that the Committee of Ministers adopt the CCR Chairman’s recommendation as regards Article 10 paragraph 4, since, in my view, it is essential to maintain salary surveys in the private sector as provided for in paragraph 4.
10. I also consider that the Committee of Ministers should follow the proposals of the CCR Chairman regarding Article 12 and accept the idea that flexible management of salary scales may be examined by the CCR after being submitted to the Deputies.
11. However, the Chairman makes no recommendation on Article 8 concerning affordability, i.e. the possibility for the governing body of one of the six Co-ordinated Organisations, for internal reasons, to deviate from the policy of tracking net salary increases in national civil services. He invites each governing body to decide for its Organisation individually whether such a clause should be included in its procedure or not and, if so, in what form. He states that Article 8 “is less a technical element…than a tool to be used by Councils in exceptional budgetary difficulties” and that governing bodies will therefore need to take a political decision on its inclusion or not.
12. The purpose of the affordability clause is to allow governing bodies, in case of budgetary difficulties, not to grant the full remuneration adjustment at the date recommended by the CCR. Reference has been made to notions, such as “budgetary difficulties” and “exceptional budgetary circumstances”, without further defining them. It should be added that any method must, in legal terms, and irrespective of other policy considerations, be predictable, transparent and reasonably in line with trends in national civil services.
13. It is therefore also my proposal that the Committee of Ministers confirm its sovereign right to take special measures concerning the application of remuneration adjustments if exceptional and substantiated circumstances so warrant rather than resort to the drafting of a complicated and controversial affordability clause. I further propose that the Ministers’ Deputies delegate to me the task of “sounding the alarm” when I believe the affordability clause should be invoked. At the same time, I propose that the Ministers’ Deputies decide that, in no case can the purchasing power of staff members be eroded – (i.e. even when the question of “affordability” is invoked, the salary adjustment must be at least equivalent to any increase in inflation). This proposal was accepted by the majority of the CCR.
14. Finally, but very importantly, I would draw your attention to the fact that, as the CCR Chairman has put it himself, the CCR has failed to reach consensus on one of its most basic responsibilities, namely the production of the remuneration adjustment method to be applied to active and retired staff of the six Co-ordinated Organisations. Ways must quickly be found so that the Co-ordination system again fulfils its function of freeing the governing bodies from complicated technical and labour-related discussions and enables them to avoid embarking on parallel tripartite negotiations in each Organisation.
15. These points are reflected in the draft decisions set out below:
1. took note of the letter of the Chairman of the Co-ordinating Committee on Remunerations (CCR) to the Councils of the Co-ordinated Organisations, as well as the 139th Report of the CCR concerning the remuneration of the Staff of the Co-ordinated Organisations: General Review, Report by the CCR Chairman as they appear in CM(2002)138;
2. decided that as from 1 January 2003 the salary adjustment procedure as determined by the 80th Report of the CCR will be replaced by the new salary adjustment method provided for in the Annex to the 139th Report, under the following conditions:
a. Articles 1 to 7 and 9 to 13 are adopted as set out in the Annex, with the result that:
- the principle of private sector studies (Article 10, paragraph 4) is maintained, and
- provision is made for the possible introduction of flexible management of salary scales, to be examined by the CCR after having been submitted to the Ministers’ Deputies (Article 12);
b. As regards Article 8, the Deputies reserve the right to decide not to follow the CCR’s recommendation regarding salary adjustment for a given year in the event of exceptional budgetary difficulties (“affordability”) , provided that:
i. any such decision shall be based on a proposal by the Secretary General which must
- be based on justifiable budgetary circumstances;
- respect general legal principles in this domain, especially the principle of proportionality;
- be established openly in consultation with the Staff Committee.
ii. in cases where affordability is invoked the annual adjustment may be reduced to the rise in national consumer price index for the relevant host country. Moreover, the amount awarded may be phased or postponed until later in the calendar year.
3. invited the Secretary General to examine with the representatives of Secretaries General of the other Co-ordinated Organisations ways to reinforce the system so that it continues to fulfil its role.