Committee on Petitions NOTICE TO MEMBERS
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1 European Parliament Committee on Petitions NOTICE TO MEMBERS Subject: Petition 0569/2006 by Mr Joseph Vincent Caruana (Maltese), on calculation of his pension entitlements Petition 0382/2007 by Mr Joseph Fsadni (Maltese) on calculation of his pension entitlements in Malta Petition 0169/2008 by Mr. Albert Cilia-Vincenti (Maltese), on discriminatory treatment resulting from Maltese pension legislation forbidding occupational/private pensions Petition 1645/2010 by Peter Boulter (British), on the deduction of his RAF service pension from his entitlement to pension in Malta 1. Summary of petition 0569/2006 The petitioner, a Maltese citizen who receives a UK pension as a result of his work in UK between 1964 and 1975, complains that this amount of money has been deducted from the amount he would have been entitled to as pension after retirement in Malta. He considers that the Maltese legislation is unfair and asks the European Parliament for help. Summary of petition 0382/2007 The petitioner challenges the Maltese legislation on pension entitlements. The petitioner explains that he receives a pension for having served in the UK Air Force, which, under Maltese legislation, is deducted from the pension he is entitled to for his working years in Malta. The petitioner asks the European Parliament to investigate this issue. Summary of petition 0169/2008 The petitioner challenges the Maltese pension legislation which prohibits occupational/private pensions, except for the Maltese parliamentarians. On the basis of this legislation, the petitioner, who worked for 24 years with the British National Health System (NHS) and for 12 years with the Maltese NHS, had his Maltese retirement pension reduced to practically nothing. The petitioner considers himself discriminated against and sees the aforementioned CM\ docx PE v05-00 United in diversity
2 legislation as being against the spirit of free movement of labour within the EU. Summary of petition 1645/2010 After a career with the RAF, the petitioner moved to Malta and had a second career. He discovered, upon his recent retirement, that Maltese law foresees a deduction of his British service pension from his Maltese pension entitlement 2. Admissibility Petition 0569/2006 declared admissible on 28 November Petition 0382/2007 declared admissible on 19 September Petition 0169/2008 declared admissible on 24 June Petition 1645/2010 declared admissible on 14 April 2011 Information requested from Commission under Rule 216(6) 3. Commission reply to petition 569/2006, received on 23 March The Petitioner is a Maltese citizen, and a resident of Malta, who receives a British pension having worked in the UK between 1964 and He states that the amount of this pension has been deducted from his Maltese retirement pension. The Petitioner states that it is an injustice that his UK pension is being deducted from his Maltese pension. The Commission s comments on the petitioner s arguments From the information provided, it appears that the Petitioner's UK pension is an occupational pension paid by the UK Civil Service, rather than a state retirement pension. If this is the case, the Community Regulations on the coordination of social security (EC Regulation EC 1408/71 and 574/72) will not apply, and the Commission services will be unable to assist the Petitioner. However, as the full facts of the case are not clear from the petition, the Commission services are willing to investigate further provided that the Petitioner writes to them with further details. Conclusions An initial consideration suggests that this matter is not within the Community rules on the coordination of social security schemes. However, as the facts of the case are unclear, the Petitioner is welcome to write to the relevant Commission services (Unit E3 in the Directorate-General for Employment, Social Affairs and Equal Opportunities) with the full details of his case. The Commission services will then be happy to investigate further. 4. Commission reply to petition 0382/2007, received on 19 December The Petitioner is a Maltese citizen, resident in Malta, who receives a British pension from work in the UK Royal Air Force. He states that the amount of this pension is being deducted from his Maltese retirement pension. PE v /7 CM\ docx
3 The Petitioner states that this is discrimination, as he has paid full National Insurance contributions to the Maltese government and so he believes he should be entitled to a full Maltese pension. It is necessary to clarify the status of the pension that the petitioner receives from the UK. If it is an occupational pension, rather than a state retirement pension, the Community Regulations on the coordination of social security (EC Regulation EC 1408/71 and 574/72) will not apply, and the Commission services will be unable to assist the Petitioner. However, in order to establish this, it is necessary for the Commission to investigate the status of the pension, and to clarify the national pension rules, with the appropriate authorities. The Commission services will consult the appropriate national authorities in order to investigate this matter further. 5. Commission reply to petition 0169/2008, received on 25 November The Petitioner is a Maltese pensioner, resident in Malta, who worked for 24 years with the British National Health Service (NHS) and for 12 years with the Maltese NHS. He complains that, according to Maltese legislation, his UK civil service pension is being deducted from his Maltese pension. He states that this legislation is discriminatory. If he had worked his whole professional life in the United Kingdom he would now be retired in Malta with both British occupational and state retirement pensions intact. It is necessary to clarify the status of the pension that the petitioner receives from the UK. If it is an occupational pension, rather than a state retirement pension, the Community Regulations on the coordination of social security (EC Regulation EC 1408/71 and 574/72) will not apply, and the Commission services will be unable to assist the Petitioner. However, in order to establish this, it is necessary for the Commission to investigate the status of the pension, and to clarify the national pension rules, with the appropriate authorities. The Commission is currently consulting the appropriate national authorities to investigate this matter further and will inform the Parliament of its findings. 6. Commission reply, received on 7 July Petitions 569/2006, 382/2007 and 0169/2008 The Commission services have had intensive contacts with the UK and Maltese authorities on this issue over the last few months. While the Maltese authorities confirmed that the Maltese Social Security Act (Cap. 318) provides for the deduction of service pensions from national Maltese social security pensions, the status of the UK civil servant pension schemes under Community law still remains open. This concerns in particular the question as to whether or not they fall under the Community Regulations on the coordination of social security (EC Regulations 1408/71 and 574/72). After having assessed this issue in detail on the basis of the information provided by the Maltese authorities, the Commission considers that the Maltese legislation in question is not CM\ docx 3/7 PE v05-00
4 in conformity with Article 39 of the Treaty, as such a practice constitutes an obstacle to the free movement of workers. The Commission has opened an infringement procedure against Malta on this issue. 7. Commission reply, received on 8 October 2010 Petitions 569/2006, 382/2007 and 0169/2008 After having assessed this issue in detail on the basis of the information provided by the Maltese authorities, the Commission considers that the Maltese legislation in question is not in conformity with Regulation 1408/71, in particular with regard to the rules on overlapping of benefits of the same kind, such as two old age pensions. The Commission has therefore opened an infringement procedure against Malta on this issue and is pursuing the investigation. 8. Commission reply, received on 30 November 2016 Petitions 569/2006, 382/2007 and 0169/2008 The petitions concern the application of Maltese rules to prevent the overlapping of a Maltese pension with a civil servant's pension granted by the United Kingdom. Based on Maltese legislation, persons receiving both benefits have their Maltese pension reduced by the amount of the UK pension. The infringement procedure against Malta The Commission considered the Maltese legislation contrary to EU rules on the coordination of social security systems and, as it already informed the European Parliament in 2010, it started an infringement procedure against Malta. In 2014, the Commission referred Malta to the Court of Justice of the European Union for infringing EU rules (Case C-12/14). Based on Article 9 of Regulation (EC) No 883/2004 on the coordination of social security schemes, each Member State makes a declaration every year ("Article 9 Declaration"), indicating, among other issues, the schemes, which are covered by this Regulation. The Commission considered that the UK civil servants' schemes are covered by EU rules on social security coordination even if they are not listed in the UK Article 9 declaration. However, even though the Advocate General followed the reasoning of the Commission, the Court dismissed the action. It considered that it follows from the principle of sincere cooperation (Article 4(3) of the Treaty on European Union) that every Member State carries out a proper assessment of its own social security regimes and, if necessary, following that assessment, declares them as falling within the scope of the Regulation. The Court of Justice held that declarations made by Member States listing the schemes covered by EU rules on social security coordination create a presumption that the listed schemes are covered by the PE v /7 CM\ docx
5 said rules, and any schemes which are not listed are outside the scope of those rules. The Court considered that Member States must take into consideration declarations submitted by other Member States and, as the UK special schemes were not listed in its Article 9 declaration, Malta must take into consideration this declaration and not apply the coordination rules to those schemes. The Court did not pronounce itself on the qualification of the UK special schemes concerned and if they are or not social security schemes covered by the Regulation. The new approach after the ruling of the Court in case Commission/Malta In the ruling mentioned above, the Court gave the Administrative Commission for the coordination of social security systems 1 an increased role in solving any issue following an alleged non-reporting or inaccurate listing of a benefit in an Article 9 Declaration. In the meeting of the Administrative Commission on October 2016, the Commission drew the attention of all delegations to the correct assessment of national schemes as being crucial for the application of the social security coordination rules. If a scheme is listed in the said declaration, all the rules provided in the Regulation have to be applied both by the reporting State and by all the other Member States. Therefore, all Member States were asked to carefully reassess their Article 9 Declarations in order to make sure that they are correct and complete. At the same meeting, the Administrative Commission agreed to address disputes over the material scope of the Regulation in case of doubt. Conclusion In light of the findings of the Court of Justice in the case Commission/Malta, mentioned above, the Commission will discuss the qualification of the UK schemes in the Administrative Commission and will keep the European Parliament and the petitioner informed of the outcome of the discussions. 9. Commission reply, received on 31 March 2017 Petitions, 0569/2006, 0382/ /2008 and 1645/2010 The petitions concern the application of Maltese rules to prevent the overlapping of a Maltese pension with a civil servant's pension granted by the United Kingdom. Based on Maltese legislation, persons receiving both benefits have their Maltese pension reduced by the amount of the UK pension. 1 Based on Article 71 of Regulation (EC) No 883/2004, the Administrative Commission for the coordination of social security systems is attached to the European Commission and is made up of a governrnental representative of each of the Member States. It deals with all the administrative questions and questions of interpretation arising from the provisions of the Regulation. CM\ docx 5/7 PE v05-00
6 Regulation (EC) No 883/2004 on the coordination of social security systems 1 sets rules concerning the overlapping of benefit such as pensions. In order to apply these rules, both pensions concerned have to be covered by the Regulation. Member States have the obligation to declare all their national schemes covered by the Regulation (Article 9 Declaration). The Commission is of the opinion that the UK special schemes for public sector workers are to be considered as social security schemes within the meaning of the Regulation and should therefore be listed in the Article 9 Declaration of the UK. However, the UK has not listed these schemes in its declaration. As explained in the previous reply, in case C-12/14, Commission v. Malta, EU:C:2016:135, the Court of Justice of the European Union (CJEU) held that declarations made by Member States listing the schemes covered by EU rules on social security coordination create a presumption that the listed schemes are covered by the said rules. Where a Member State has refrained from declaring a national law under those regulations, other Member States can, generally, infer from it that that law does not fall within the material scope of those regulations. The CJEU added that the Administrative Commission for the coordination of social security systems 2 has an increased role in solving any issue following an alleged non-reporting or inaccurate listing of a benefit in an Article 9 Declaration. In the meeting of the Administrative Commission on October 2016, the Commission drew the attention of all delegations to the correct assessment of national schemes as being crucial for the application of the social security coordination rules. Therefore, all Member States were asked to carefully reassess their Article 9 Declarations in order to make sure that they are correct and complete. At the same meeting, the Administrative Commission agreed to address disputes over the material scope of the Regulation in case of doubt, provided that the issue could not be solved bilaterally. The Commission sent a letter to the UK authorities explaining its views on the qualification of the UK special schemes for public sector workers and invited the UK authorities to include these schemes in its declaration. The UK authorities have not answered this letter yet. Depending on their reply, the issue could be raised in the Administrative Commission. Conclusion The Commission will keep the European Parliament informed of the outcome of the discussions. 1 OJ L 166, Based on Article 71 of Regulation (EC) No 883/2004, the Administrative Commission for the coordination of social security systems is attached to the European Commission and is made up of a governrnental representative of each of the Member States. It deals with all the administrative questions and questions of interpretation arising from the provisions of the Regulation. PE v /7 CM\ docx
7 10. Commission reply, received on 30 June 2017 Petitions, 0569/2006, 0382/ /2008 and 1645/2010 As explained in the previous replies sent in November 2016 and March 2017, the Commission contacted the United Kingdom authorities on the qualification of the UK special schemes for public sector workers. The UK authorities were invited to include these schemes in a declaration including all schemes covered by Regulation (EC) No 883/2004 on the coordination of social security schemes, as requested in Article 9 thereof 1. In case C-12/14, Commission v. Malta, the Court dismissed the action of the Commission which asked the Court to declare that, by deducting the value of civil service old age pensions from other Member States from Maltese old age pensions, Malta has failed to fulfil its obligations under Article 46b of Council Regulation (EEC) No 1408/71 on the application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Community. The Court argued that Member States, such as Malta are bound by the declaration on the qualification of benefits made under now Article 9 of Regulation 883/2004. In the meeting of the Administrative Commission for the coordination of social security in March 2017, the European Commission therefore reminded all delegations of the importance of submitting their declarations pursuant to Article 9 of Regulation (EC) No 883/2004. Member States, in light of their obligation of loyal cooperation, were therefore required to do a proper assessment of their social security legislation and to make sure that declarations are complete and accurate. In order to improve the consistency and clarity of the Article 9 declarations, the Commission, in its capacity of Secretariat of the Administrative Commission, has proposed some changes to this year's procedure, in particular the launch of a new standard template for providing a declaration. To support the Member States in fulfilling their obligations, the European Commission has asked the Free Movement of Workers and Social Security Coordination experts to make an independent report analysing the Article 9 Declarations supplied by Member States in Delegations were encouraged to consider this report when preparing this year's procedure. The UK authorities submitted their Article 9 Declaration on 7 June The declaration is currently being analysed. Based on a preliminary analysis, the special schemes for public sector workers are still not included in the new declaration. Conclusion The Commission will keep the European Parliament informed of the outcome of the discussions. 1 OJ L166, , p CM\ docx 7/7 PE v05-00
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