BUDAPEST, July 31 (Reuters) - The European Commission is examining whether a new Hungarian law which cuts the salaries of top central bank officials is in accordance with the country's EU accession treaty, the daily Nepszabadsag reported on Saturday.
The paper cited European Commission sources as saying that Brussels looked at the pay issue automatically after the European Central Bank told Hungary any change in central bank compensation should be negotiated with the bank in advance and could affect future appointments only.
Hungary's new centre-right Fidesz government earlier this month passed a law to limit public sector pay, including at the central bank, severely cutting the salary of National Bank of Hungary Governor Andras Simor and his deputies.
The central bank has said the move hurts its independence. The government has said the pay ceiling affected the entire public sector, and was not tailored to the central bank.
Simor has come under fire from top Fidesz officials over his former investments in a Cyprus-based company as well as the bank's conduct of monetary policy during the financial crisis.
Simor, dubbed by Prime Minister Viktor Orban as an 'offshore knight', has denied any wrongdoing and refused calls for his departure.
(Reporting by Marton Dunai) ($1=218.09 Forint) Keywords: HUNGARY CBANK/
(marton.dunai@reuters.com; +36 1 327 4742; Reuters Messaging: marton.dunai.reuters.com@reuters.net)
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