Baroness Ashton will be entitled to £400,000 at the taxpayer’s expense over three years for doing nothing after finishing her five year term as the European Union’s foreign minister at the end of 2014.
By Bruno Waterfield, Brussels
2:28PM BST 05 Apr 2013
Research by The Daily Telegraph has established that the Labour peer, who finishes her job as High Representative of foreign affairs in October next year, will be paid £133,500 a year, 55 per cent of her basic salary, until the end of 2017.
The “transitional allowance” does not require her to do any work at all and she will be paid under reduced rates of EU “community” tax, rather than the standard British rates of taxation for high-income earners.
The allowance is defended as “the price for the total independence” of senior EU officials like Lady Ashton, who is also a vice-president of the European Commission, who must also “ask permission for any job they would like to do for 18 months after leaving”.
“It’s important that commissioners don’t start looking for a new job during the last months of their mandate, and that they take their time over finding appropriate new employment,” said a commission spokesman.
“That way, they can continue to give 100 per cent to the job taxpayers are paying them to do, and there is much less risk of a conflict of interest.”
On leaving her job on an annual gross salary, including allowances, of £287,543, making her the second highest paid female politician in the world, Lady Ashton will be paid one month’s salary, the sum of £23,962 as well beginning the transitional payments “on the day after leaving office”.
The allowance will not be reduced unless she earns over £134,000 in additional income, allowing Lady Ashton to take up her seat in the House of Lords, where she will be entitled to £300 in untaxed daily allowance for sittings of the unelected chamber, without loss of EU payments.
In contrast to the EU allowance, ministers are entitled to severance pay equivalent to three months of their ministerial salary when they leave the Government.
In 2021 on reaching retirement age, Lady Ashton will become eligible for her EU pension which will be worth £61,000 a year, over three times the average in Britain and also covered by the reduced rates of “community tax” paid by European civil servants.
Lady Ashton has been criticised by the Government for failing to honour a promise that her EU diplomatic service would be “budget neutral” and for making “ludicrous” demands for extra cash at a time of deep cuts to the Foreign and Commonwealth Office.
A recent report by MEPs attacked the EU’s diplomatic service, created by Lady Ashton, for being “top-heavy” with highly paid officials as well as plagued by incompetent staff and absenteeism in its 141 embassies or delegations across the world.
Douglas Carswell, the Conservative MP for Clacton, said that based on her performance Lady Ashton should be paying money back to taxpayers rather than the other way around.
“The system is run by, and for the benefit, of those troughing officials who work in Brussels,” he said. “If Baroness Ashton got proper performance related pay, she would be writing a cheque out to HM Revenue and Customs.”
Speaking to a Brussels audience recently, Lady Ashton admitted that her successor, rumoured to be Radek Sikorski, the Polish foreign minister, might be better suited for the job.
“I think it will have been a great privilege to have served in this role, but it’s quite hard. There’s a lot of travel and a lot of sitting on planes,” she said on 16 March.
“It is exhausting at times. And I think, in any event, you lay the foundations but there are people who can do things with this that probably I couldn’t do so it would be good to hand it over.”
The next British commissioner is expected to be Andrew Mitchell, the former Chief Whip, who will be rehabilitated following the “Plebgate” scandal with the top EU job, thought to be the key economic portfolio of competition.
Nigel Farage, the leader of the UK Independence Party, said: “Ashton just goes to prove the Brussels pay formula: that Eurocrats are paid huge amounts of money inversely to the amount of work they do or the little good that they achieve.”