MEPs reject plans for controversial fund managers' bonus cap

The European Parliament has voted down a controversial proposal put forward by German Green MEP Sven Giegold to introduce a bonus cap for managers of UCITS investment funds. Mr Giegold wanted to curb bonuses so that they could no longer exceed managers' basic salaries.

However, UK Conservative MEP Syed Kamall brokered an amendment with the European People's Party (EPP) and the Liberals (ALDE) to scrap the bonus cap. The amendment was passed this morning. It establishes that bonuses

"shall be considerably contracted where subdued or negative financial performance of the management company or of the UCITS concerned occurs, taking into account both current compensation and reductions in payouts of amounts previously earned."

MEPs will now wait for EU member states to agree on a common position on the new UCITS rules. After that, negotiations will start.

Mr Giegold has called today a 'schwarzer Tag' (a 'black day'), but the truth is the bonus cap would have been a bad idea for a number of reasons:

• Unlike banks, investment funds haven't received a penny from taxpayer-backed rescue packages. Therefore, although one can agree with the need to align pay with performance in the financial services sector, it would have made little sense to impose on fund managers a harsher bonus cap than the one recently introduced for bankers.

• The cap would also have undermined the competitiveness of the UCITS industry, which currently accounts for over 70% of net assets managed by the entire European investment fund industry.

• Perhaps most importantly, such a largely ideological measure could have made the City of London more eurosceptic at a time when the debate over the future of UK-EU relations is at a crucial stage.

So, good news from Strasbourg, although similar proposals on remuneration in the financial services sector are likely to come up again sooner or later - especially from the European Parliament.

However, today's vote shows that the UK is indeed listened to in Europe when it comes to financial regulation (although it also helped that a lot of UCITS funds are based in France). It's all about having a clear negotiating strategy and moving early enough in the EU's law-making process.    

Cash-for-dubbing?

Does the name Ernst Strasser (see picture) ring a bell? If not, let us refresh your memory. Ernst Strasser, from Austria, was one of the MEPs involved in the cash-for-amendments scandal unveiled by the Sunday Times last year. More precisely, he was the one who had been secretly filmed by undercover journalists boasting, "Of course I'm a lobbyist, yes."

Well, in a recent interview with Austrian TV, Strasser has sparked surprise (and some laughter, we're pretty sure) when he claimed that the video evidence being used to 'frame' him had been "deliberately tampered with by Murdoch's people", as the mouth movements do not exactly match up with the text in the film.

Right...

"Knife-attack" on two seat parliament

Libya is burning on the EU's doorstep.

The dangers of the sovereign debt crisis still loom large over the eurozone - Portugal is likely to need a bail-out soon.

EU member states are working out how best to help Japan deal with the aftermath of the worst earthquake in the country's history.

Meanwhile, trust in the EU is at an all time low in many countries across Europe.

Mundane issues such as these should not, of course, distract from the really important issue - maintaining MEPs' €180 million/20,000 CO2 a year Strasbourg seat (in addition to their ordinary seat in Brussels and their secretariat in Luxembourg).

At least, that's how France sees it. The French government has said it will challenge the decision at the ECJ, taken by a majority of MEPs to scrap one - we repeat just one - of Strasbourg's annual sessions (the EP holds two plenary sessions in the autumn to compensate for MEPs' extended holiday season.)

The French Europe Minister Laurent Wauquiez explains why:

"The parliament building in Strasbourg is the symbol of a Europe closer to citizens, a Europe that is proud of its symbols. The government will not accept the knife-attack on the contract which is in the treaties."

Well of course. Now it all makes sense.

A Royal Extravagance

Spot the odd one out…

• Buckingham Palace in London
  
• Palacio Real de Madrid, Spain
• Stockholms slott, Sweden, and
• The Louise Weiss building in Strasbourg, France.

We’re guessing that most people will not ever have heard of the last one. It’s in fact, the infamous seat of the European Parliament in Strasbourg – better known as the reason for the European Parliament’s utterly ridiculous ‘travelling circus’.

The European Parliament's 216-mile monthly trek to Strasbourg beggars belief. But no matter how many citizens, MEPs or even EU officials complain, the out-of-touch people at the very top refuse to bow their heads to listen.

In an interview with Euractiv, European Parliament President Jerzy Buzek got the chance to explain why he defends the Strasbourg seat.

Strasbourg is a symbolic place. Symbols are important

€200 million a year is an expensive symbol, but Buzek sticks to his guns:

We can also ask whether for some member states it is right to keep a monarchy. But for these countries that has an historical meaning and it is still an important part of public life and interest

Right...Perhaps that explains the European Parliament’s, at times, interesting take on democracy (i.e. voting to ignore the outcome of the Irish referendum on the Lisbon Treaty). He continues,

So, why would we eliminate Strasbourg? It is the very symbolic place of the European Union. It is indeed very important as it represents the essence of our main value: solidarity

Apart from the bizarre parallel that Buzek is trying to draw between Europe's monarchies and the two-seat European Parliament, what kind of 'solidarity' is he talking about? And with who exactly? Scrapping Strasbourg would save over €200 million a year and 20,268 tonnes of CO2 emissions, so he certainly can't be referring to solidarity with taxpayers or the environment (but who cares, eh?)

What's next, horse drawn carriages for Buzek and his mates and a regal eurocrat wedding?

MEPs should vote for common sense

Conservative MEP Ashley Fox may have thought of a practical plan to reduce some of the ridiculous cost of the European Parliament's travelling circus from Brussels to Strasbourg each month.

There have been many previous attempts to abolish this hugely wasteful-PR-disaster-of-a-practice before (it even made it into the Con-Lib Coalition Agreement). But, alas, it is written in the EU treaties that the EP will have its plenary sessions in Strasbourg - which would only change over Sarkozy's (or any other French President's) dead body.

It is estimated that the exercise costs taxpayers around €200m a year and produces at least an extra 20,000 tonnes of carbon dioxide every year.

But, unlike previous efforts, Fox's plan may actually work. Fox wants to combine the two Strasbourg plenary sessions scheduled for September 2012 into one, which he says, "could save €15m and prevent 1600 tonnes of CO2 being needlessly wasted."

The EU treaties say that:

The European Parliament shall have its seat in Strasbourg where the 12 periods of monthly plenary sessions, including the budget session, shall be held. The periods of additional plenary sessions shall be held in Brussels. The committees of the European Parliament shall meet in Brussels. The General Secretariat of the European Parliament and its departments shall remain in Luxembourg.

Combining, rather than scrapping, the extra plenary session wouldn't break the rule of having "12 monthly" sessions in Strasbourg.

So far, 180 MEPs have signed his declaration which would require a simple majority of those present in the parliamentary chamber to be successful.

This would only be a small victory for common sense but it would send an important message and show that many MEPs find the practice as absurd as the rest of us.

Travelling clowns

According to reports, only 268 of the European Parliament's 785 MEPs have signed the declaration calling for an end to the 'travelling circus' which sees MEPs moving from Brussels to a second seat in Strasbourg every month at enormous cost to the taxpayer (not to mention the environment).

393 signatures were needed for the declaration to become official EP policy.

Earlier this week we wrote to MEPs urging them to sign the declaration and help put an end to this scandalous waste of time and money. But clearly their hearts are just not in it.

We've heard some MEPs argue that their objection to the declaration was that it would scrap the Strasbourg seat, instead of the Brussels one. This is a poor reason for failing to give support in principle to ending the circus.

Nevertheless, it should in theory at least mean that they would support a new declaration which does not specify either Brussels or Strasbourg, but which simply calls for an end to the circus.

But will anyone draw one up?

MEPs update

Our sources in Strasbourg confirm that all UKIP MEPs have now signed the European Parliament Declaration calling for an end to the 'travelling circus', after Open Europe applied some pressure yesterday. Bravo.

Will the Conservatives follow suit?

And can Richard Corbett convince his fellow European Socialists to follow him and sign?

At least among the UKIP lot there seems to have been some hesitation as a result of a clause in the Declaration that says Strasbourg would be "compensated" for losing its EP building.

Obviously this is not ideal, but OE's view is that this Declaration is better than nothing in terms of its value as a political lever with which to bash the Council. In any case, we don't see anyone putting forward an alternative statement which doesn't mention compensation.

The ultimate decision of whether or not to scrap the second EP seat lies with the member states. But until those MEPs who are ostensibly against the 'travelling circus' show some will to support what small efforts there are to remove it, then citizens are rightly going to begin wondering what exactly they are there for.

Without 393 signatures, the Declaration lapses tomorrow.

Tick, tick, tick...

MEPs have two days left to show their colours and sign a Written Declaration being circulated, which calls for an end to the ridiculous and expensive practice of moving the Parliament between Brussels and Strasbourg every month.

Open Europe has published the latest available list of signatures - which shows us which MEPs have (and have not) signed the petition. It dates from last week, when reports said that only 235 out of 785 MEPs had signed it. 393 signatures are needed to make the Declaration an official EP position.

Those who have signed have a cross next to them. As the list is a few days out of date, it is possible that more people may have signed the petition by now. Let's hope so. We have today written to all those MEPs who are yet to sign, urging them to sign up before the Thursday deadline.

After all, while the ultimate decision about whether or not to scrap the second seat must be taken by the member states, if the EP itself took a position in favour then this would send a strong signal to the public that this pointless waste of time and money cannot be allowed to continue.

Fingers' crossed that the petition attracts enough signatures. Watch this space for some naming and shaming when we get hold of the final version towards the end of the week.

Call yourself a reformist MEP? Then get your finger out

We've managed to get hold of a list of numbers of MEPs from each country and each political group which shows us how many have not yet signed the declaration calling for an end to the wasteful two-seat European Parliament. No names yet, but we'll be sure to post these once we have them. MEPs have until 15 January to sign up.

Numbers that HAVE signed:

By Group

ALDE: 58 out of 100
EPP-ED: 66 out of 288 (shockingly poor - remember, this is where the British Conservatives currently sit)
Greens-EFA: 21 out of 43
GUE-NGL: 7 out of 41
Ind/Dem: 4 out of 22
Non-attached: 7 out of 31
Socialists: 57 out of 217
UEN: 13 out of 43

So less than 23% of EPP-ED members have signed, and only 18% of (UKIP's) Ind/Dem group have. Overall, it's less than 30% of all MEPs, and with only 5 days left to go. This in spite of the fact that more than 1.2 million citizens have signed an online petition calling for the European Parliament to have one seat only.

By Country:

Austria: 3 out of 18
Belgium: 10 out of 24
Bulgaria: 4 out of 18
Cyprus: 1 out of 6
Czech Rep: 6 out of 24
Denmark: 11 out of 14
Estonia: 2 out of 6
Finland: 7 out of 14
France: 0 out of 78 (!!!)
Germany: 15 out of 99
Greece: 4 out of 24
Hungary: 6 out of 24
Ireland: 7 out of 13
Latvia: 4 out of 9
Lithuania: 6 out of 13
Luxembourg: 0 out of 6
Malta: 1 out of 5
Netherlands: 21 out of 27
Poland: 13 out of 54
Portugal: 7 out of 24
Romania: 8 out of 33
Slovakia: 0 out of 14
Slovenia: 4 out of 7
Spain: 6 out of 54
Sweden: 15 out of 19
UK: 51 out of 78

No surprises that the French are the least likely to want to scrap the two-seat Parliament. But it does seem amazing that not even one wants reform.

The Swedes and the Danes meanwhile are topping the table with an excellent sign-up rate so far of nearly 80%. The Brits, on the other hand are languishing behind with only 65% of MEPs bothering to try and stop this farce of moving between Brussels and Strasbourg for a week every month.

Which ones haven't bothered to sign, we wonder? Watch this space - we'll do our best to name and shame.

Will MEPs vote to keep the circus travelling?

The Parliament reports that only 235 MEPs have signed a written declaration calling for an end to the so-called “travelling circus” between Brussels and Strasbourg, which costs EU taxpayers €203m per year.

That is well short of the 393 MEPs, or more than half of the assembly’s deputies, needed for it to have a chance of becoming formal EU policy.

Slow-moving MEPs have until 15 January to sign it, so next week’s plenary in Strasbourg will be crucial.

One MEP, German ALDE member Alexander Alvaro, accused those colleagues who privately endorse the one-seat campaign but have yet to sign the declaration, of “hypocrisy”. He said, “They should stand up and be counted."

Hear hear.

No controversy here please, this is the European Parliament

British MEP Glenis Willmott paints a very worrying picture of the European Parliament's attitude to democracy in the Parliament Magazine.

She accuses the EP authorities of undermining MEPs' efforts to promote a debate on the £200m monthly jaunt to Strasbourg.

She said she is

“dismayed by what not only appears to be the unjust treatment of those of us campaigning for a one-seat solution, but also a lack of respect for those one and a quarter million EU citizens who have so far signed the petition at www.oneseat.eu for parliament to have a single seat in Brussels. So far, requests for a serious debate on this issue in plenary have been ignored and the recently launched written declaration 75 on holding all parliament plenary sessions in Brussels has faced seemingly discriminatory measures against its promotion to MEPs.”

She continues:

"[Last month], a poster promoting the written declaration was removed by parliament’s authorities under the pretence that MEPs ‘should avoid activities on parliament’s premises which might be regarded as controversial’. I find this wholly ridiculous. Most dictionaries define controversial as ‘causing disagreement or discussion’. Should a modern parliament such as ours really be seeking to restrict disagreement or discussion? Yet unless I have grossly misunderstood the situation surrounding the removal of the poster, that is precisely what has happened."

“I do not wish to go over all the well-rehearsed arguments surrounding cost, pollution and wasted time yet again, but would merely like to appeal once more on behalf of my colleagues and on behalf of the EU’s citizens for a solution to be found to this ludicrous and embarrassing state of affairs.”