Notes 99/17...656/11.1...Council of Europe pension scheme and sickness insurance arrangements - Written Question No. 363 by Mr Cunliffe

Ministers' Deputies

Notes on the Agenda

15 January 1999

Restricted

No. 99/17

Reference documents

- CM/Del/Dec(98)651/11.5, 655/11.1

- CM(96)30

656/11.1

(B level, 19th January 1999)

 

Council of Europe pension scheme and

sickness insurance arrangements –

Written Question No. 363 by Mr Cunliffe

 

Action

The Deputies are invited to examine, with a view its adoption, the appended draft reply.

 

Written question No 363 concerning the Council of Europe pension scheme and sickness insurance arrangements by Mr Cunliffe appears in document CM(96)30.

At their 557th meeting (5-8 February 1996), the Deputies were informed of Mr Cunliffe's written question. In the light of decisions taken at the 651st and 655th (CM/Del/Dec(98)651/11.5, 655/11.1) meetings of the Ministers' Deputies, the Secretariat has prepared the appended draft reply.

DRAFT DECISION

Item 11.1

Council of Europe pension scheme and

sickness insurance arrangements –

Written Question No. 363 by Mr Cunliffe

(CM(96)30)

Decision

The Deputies adopted the following reply to Mr Cunliffe's written question:

"The Committee of Ministers is in a position to report major developments in this complex field.

In autumn 1998, the Committee received a new actuarial study on the pensions scheme. This independent study assesses the long-term financial burden (up to 2078) of the scheme. It gives indications of the budgetary impact of the present system of financing and puts forward two alternative funding methods relying to a greater or lesser extent on a reserve fund.

Starting at the end of January 1999 the Budget Committee, at the request of the Committee of Ministers, will be considering the administrative and financial aspects of the possible establishment of a fund on the basis of this study and the Secretary General's proposals, taking into account ongoing work within the Co-ordination system concerning the reduction of the costs of the system. The Budget Committee may have it in mind to recall the possibility - which it has already put forward - of reducing the short-term financial burden of setting up such a fund through savings resulting from a change in the system of sickness cover. The Committee of Ministers has asked the Secretary General to report as soon as possible on various aspects of the creation of a fund, in the light of the Budget Committee's opinion.

It should be pointed out in this connection that a new, entirely private, social protection regime will enter into force on 1 March 1999. It will provide the medical and social cover of all new staff members as well as 62% of the present permanent staff. During the last quarter of 1998, the latter were invited to opt either to join the private system or to remain affiliated to the French Social Security system. The savings for the budget have yet to be quantified precisely but should be in the region of twenty million francs in a full year. The Secretary General has indicated that, in his view, a large proportion of these savings could serve to compensate much of the cost of setting up a pension fund.

At the appropriate time this year the Committee of Ministers will be considering proposals aimed at enabling the Organisation to face up in the most advantageous way to its long-term obligations and to stabilise the funding of benefits."



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