Maltese MEP on inquiry commission

An uproar over the rent of two buildings being used by the European Parliament in Strasbourg yesterday led to the postponement of the budget discharge for 2004 and the appointment of an ad hoc commission by Parliament's Budgets Committee to look into the matter.

Nationalist MEP Simon Busuttil was appointed as a member of this investigative commission representing the European People's Party.

"I am shocked by what has emerged so far and we are now planning to go into all the details of these serious allegations," Dr Busuttil told The Times yesterday.

The allegations, appearing for the first time in the French regional press, concern the overcharging by the City Council of Strasbourg of some €150 million in rent over the past 25 years.

It is being suspected that prices for the renting of the two structures, known as the Winston Churchill and the Salvador de Madraiga buildings, could have been hiked by 10 to 40 per cent since 1979. The properties are owned by Dutch pension fund SCI Erasme, which lets them to the City which, in turn, sublets them to the European Parliament. The Parliament then pays rent to the Strasbourg local authorities.

The allegations emerged during talks over the purchase of the buildings by the European Parliament. It resulted that the City of Strasbourg would make a profit of €29 million from the purchase.

The European Parliament yesterday said that the long-planned purchase is now on hold as the investigation got underway into how much was overpaid and whether there was any kind of fraud involved. So far, the Strasbourg City Council has refused to cooperate on preliminary demands for information by MEPs.

The allegations are likely to increase the pressure on the European Parliament to pull out completely from Strasbourg, used only once a month for its plenary sessions. MEPs are very critical of what they call a "travel circus" which, apart from making their lives less comfortable, is costing the EU taxpayers some €200 million extra a year.

Strasbourg's position as one of the official seats of the European Parliament has been enshrined in the EU treaty since 1992, with any changes needing the consent of all 25 member states.

Dr Busuttil said the new ad hoc commission is expected to report back to the European Parliament by the end of July. Until then, the budget discharge on the 2004 budget will remain on hold.