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Whereas the European Parliament was demanding a clamp down on tax havens, a lot of its personal MEPs have been utilizing their month-to-month workplace allowances to finance a luxurious pension scheme that held company property within the Cayman Islands, Bermuda and elsewhere.
The investments, together with in giant banks requiring bailouts, have been made on the peak of 2008-2010 monetary disaster that had ushered in mass unemployment and austerity cuts affecting bizarre Europeans.
Amongst these have been 16,000 shares of Cayman Islands primarily based Teck Sources Ltd, Canada’s largest diversified mining agency. The shares have been held shortly earlier than the European Parliament handed a decision slamming the function performed by tax havens in encouraging and profiteering from tax avoidance.
“When investments happen by jurisdictions equivalent to Cayman Islands and Bermuda, it ought to undoubtedly make the alarm bells go off,” stated Tove Maria Ryding of Tax Justice advocacy group.
Ryding stated that though not all investments by these jurisdictions are problematic, they need to undoubtedly be a cause for introducing further precaution and excessive requirements of transparency.
The newest revelation additionally comes at a time when the European Parliament is making an attempt to regain public belief within the wake of the Qatargate corruption scandal, the place one in every of its now former vice-presidents is awaiting trial carrying a police ankle monitor.
The investments have been made on the behalf of a so-called voluntary pension fund, a Luxembourg-based scheme that’s presently operating a €379m actuarial deficit and which can require a taxpayer bailout as as early as subsequent yr. MEPs on the time solely needed to contribute two years into the fund with the intention to then obtain a pension for all times.
The parliament’s secretive management, often known as the Bureau, is presently scrambling for options within the hopes of avoiding one other public relations catastrophe forward of the 2024 European elections.
The problem has riled vital MEPs who’ve for years been piling on stress for the Bureau to give you solutions however to no avail. Amongst them is Monika Hohlmeier, a German centre-right MEP who chairs the highly effective budgetary management committee.
“The Voluntary Pensions Fund has been inflicting me critical complications for a while now,” she stated, in an electronic mail.
“Once I now hear that the funding technique included property in tax heavens such because the Cayman Islands, then it simply provides to the ever-growing checklist of issues this fund gathered”, she stated.
Coal mine shares apart, the fund additionally held quite a few shares within the Bermudas, as properly in different tax havens like Hong Kong, Singapore, and Switzerland. The fund ultimately bounced again to pre-global monetary disaster figures, famous asset managers in a 2011 report.
EUobserver obtained the checklist of investments spanning 1994 to 2010 from the Luxembourg enterprise register.
However the breakdown of particular person investments stops put up 2010 with the European Parliament refusing to launch any additional particulars.
“The voluntary and complementary pension fund for MEPs was created in 1990, when there was no single statute for MEPs,” stated a spokesperson from the European Parliament.
“The fund was closed in 2009, when the brand new MEPs’ single statute entered into pressure,” she stated, noting the fund is a non-profit affiliation ruled by Luxembourgish regulation.
Though now not open to MEPs since 2009, the fund remains to be making investments at present on their behalf.
Requested about these investments, she stated the European Parliament was unable to remark as a result of the fund is a “third social gathering”.
This comes regardless of the fund’s board being composed of sitting MEPs, together with Janusz Lewandowski and European parliament vice-presidents Othmar Karas and Roberts Zile.
Zile is the parliament’s doc gatekeeper. Late final yr, he refused a freedom of data request filed by EUobserver to reveal extra info on the voluntary pension fund.
And earlier this month, the European Parliament handed its finances report and known as upon the Bureau to make clear the entitlements of present and previous MEPs stacking up a number of pensions.
The Greens had tabled an modification demanding MEPs withdraw from the voluntary pension fund in the event that they already obtain one other pension.
However that modification was voted down 272 towards 203. Amongst these rejecting it have been Lewandowski, Karas, and Zile. The latter two are beneficiaries of the voluntary pension fund.
Different notable beneficiaries embody the EU’s overseas coverage chief Joseph Borrell in addition to former European local weather commissioner Miguel Arias Canete and others.
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