TrustHLT/LaCour huggingface dataset:
GR1 (Government): Historically, there were insurance pension schemes and social security pension schemes in which contributory and solidarity elements intermingled to various degrees.
GR1 (Government): In Hungary, the solidarity elements became absolutely predominant in the communist era.
GR1 (Government): In the transition period, the pension system was used and abused to avoid unemployment.
GR1 (Government): Over the years, millions of people benefited from some form of early retirement scheme.
GR1 (Government): Considerations of employment policy and social policy in the wider sense influenced the regulation of pension benefits.
GR1 (Government): Despite efforts to move towards a more contributory system, solidarity elements, especially due to past obligations, acquired rights, remained predominant at least on a general level, if not from each individual's point of view.
GR1 (Government): In Hungary, the pension system operates in a pay-as-you-go system, which, similarly to the pension systems of many European countries, has faced serious challenges due to the adverse impact of long-term population aging and its consequences, namely the high ratio of pension receivers as compared to the ratio of contribution payers.
GR1 (Government): In Hungary, this situation was only made worse by the fact that after the year of 1989, several privilege-based allowances designated as pensions transitioned, but in fact not covered by any separate employer or employee-paid contributions to the pension fund, were retained for certain occupational groups.
GR1 (Government): Moreover, in addition to the demographic factors, the proportion of social security contributors further decreased due to the statutory availability of early retirement schemes, inducing to opt for early retirement and simultaneously working as a pensioner under preferential tax treatment.
GR1 (Government): That is, quite contrary to the original aim and function of pensions, such allowances were paid not only to retirees having withdrawn from the labour market, but also to persons active in that market, thereby decreasing the number of job offers available in the labour market to contribution payers and further undermining the sustainability of the social security system.
GR1 (Government): Due to Hungary's significant budgetary deficit and public debt, this situation, deteriorated by the 2008 world economic crisis, became unsustainable.
GR1 (Government): From 2008 on, a restriction was introduced in respect of pensioner employees not having reached the retirement age, under which, upon reaching a work income ceiling first 12 times, then 18 times, of the minimum wage, pension disbursements had to be suspended irrespective of whether it was earned in the private or the public sector.
GR1 (Government): This restriction, which in 2008 was not applicable to service pensioners and was abolished in 2010 for persons who retired prior to 2008, didn't prove to be sufficient for securing the sustainability of the pension system, hence further reforms were required.
GR1 (Government): In March 2011, the government decided to take measures to make the spending of the pension fund more calculable, with an emphasis on its contributory nature.
GR1 (Government): The government decided that in the future the pension fund would only pay benefits to those who had reached the retirement age, money collected from pension contributions of the employee population would only be spent on pension benefits and all entitlements allowing persons capable of work to retire before reaching the statutory age limit would be abolished.
GR1 (Government): The reasoning of the Act of 2011 on the elimination of early retirement pensions on pre-retirement allowance and service allowance, adopted in order to realise the above objective, stated that early retirement pensions disbursable from the pension fund had only been partly covered by pension contributions and their disbursement could only be secured from the central budget instead of the pension fund by increasing public debt.
GR1 (Government): The aim of the reform was to ensure that pensions costs do not in the future exceed the revenues gained from pension contributions and that all payments made from the central budget do appear in that budget as expenditure.
GR1 (Government): Thereby the type of allowance received and the source of its funding should become clear to all beneficiaries.
GR1 (Government): For a transition period some under retirement age benefits still remained in the pension fund's budget, the deficit of which is anyway financed by the state budget.
GR1 (Government): In 2012 the entitlement of 1.1 million people were rearranged and the number of pensioners
GR1 (Government): receiving their benefits from the pension fund decreased by 18%.
GR1 (Government): As a result the proportion of old age pensioners increased from 80% to 92% amongst the beneficiaries of the pension fund.
GR1 (Government): A further element of the reform, balancing the short term and long term interests of the pension fund, was the abolition of the ceiling of pension contributions which was criticised by the applicant in his memorial as an alleged abolition of the maximal amount of a monthly pension.
GR1 (Government): The applicant's allegations are wrong and maliciously misrepresent the truth.
GR1 (Government): It was not a ceiling on the amount of monthly pension that was abolished by a ceiling on monthly pension contributions which in the short term results in more contributions being paid to the pension fund.
GR1 (Government): Contrary to the applicant's allegations no maximal amount of pension had been set by law before 2012, the amount of 1,000 euro indicated by the applicant was a calculated amount based on maximum contributions in case of retirement at the age of 62.
GR1 (Government): However, retirement well after the pensionable age and a very long service period could result in a pension of more than 2,000 euro already in 2011.
GR1 (Government): In the short run the abolition of the ceiling on pension contributions resulted in a significant increase in the revenues of the pension fund and while in the long run it may also contribute to an increase of its expenditures, there are still significant constraints to that development, namely a highly degressive calculation of the amount of the pension.
GR1 (Government): Parallel to the measures of social security policy, the government also took action in the field of employment policy with a double aim of reducing public debt and ensuring a fairer system of burden sharing and distribution of public funds.
GR1 (Government): In 2012 new provisions were introduced concerning the employment of pensioners in the public sector.
GR1 (Government): Compulsory retirement at the statutory pensionable age with a prohibition of re-employment was introduced as a means of facilitating the reduction of the number of public employees and downsizing civil service where appropriate or of reducing unemployment of younger people.
GR1 (Government): However, this measure was applicable only to the central government, ministries and their subordinate bodies with the scarce possibility of individual exceptions while local governments were not obliged to dismiss their employees who were already entitled to receive pension benefits including early retirement benefits.
GR1 (Government): Local government's employees were given a choice whether to discontinue the employment and continue to receive pension benefits or if it was more favourable to them to continue the employment relationship with the suspension of the disbursement of pension benefits.
GR1 (Government): Most early retirement pensioners working in the public sector as well as in the private sector had already been subject to an income ceiling under Section 83B of the Pension Act, a yearly income of 18 times the minimal wage since 2008 with a few exceptions including service pensioners like the applicant.
GR1 (Government): The extension of the restriction by way of Section 83C of the Pension Act in the public sector to old age pensioners and all formerly privileged early retirement pensioners in respect of the total sum of the pension was intended to ensure a fairer system of burden sharing and distribution of public funds.
GR1 (Government): Actually it was a strong incentive for public servants to retire from office and only continue to work if it was an option more favourable for them than being a pensioner.
GR1 (Government): It has thus become part of the status of various categories of public servants that they were expected to stop abusing the pension system and share the burdens of solidarity in exchange for better incomes from the public budget.
GR1 (Government): Where shortage of staff made the continued employment of pensioners necessary, such as in the healthcare sector, where salaries were very low, the discretionary payment of a salary supplement was made possible at the expense of the public budget but not from the pension fund.
GR1 (Government): Calculating from the increase of the applicant's pension between 2013 and 2016, we can conclude that the applicant must have received similar compensation from his public employer.
GR1 (Government): Public employees employed under the Labour Code in a less privileged status than various categories of public servants and usually receiving lower wages remained subject to the income ceiling set by Section 33B of the Pension Act up until reaching the pensionable age.
GR1 (Government): Only elected public officials remained exempt from these restrictions.
GR1 (Government): The Government notes that some of the measures described above have already been examined by the Court.
GR1 (Government): In the cases of Markovic and others v. Hungary concerning the transformation of service pensions,
GR1 (Government): the Court accepted in its admissibility decision of 24 June 2014 that the above described general interest of economic and social policies pursued by the measures complained of qualified as a legitimate aim for the purposes of the Convention.
GR1 (Government): Although the applicants in that case similarly to the applicants in the present case disputed the adequacy of the measures of the quantitative significance of their effects, the Court argued that, provided that the legislator chose a method that could be regarded as reasonable and suited to achieving the legitimate aim being pursued, it is not for the Court to say whether the legislation represented the best solution for dealing with the problem or whether the legislative discretion should have been exercised in another way.
GR1 (Government): It also observed that the contested measure was part of a whole range of measures implemented with the aim of reducing public spending.
GR1 (Government): In this context, the Government further recalled that, according to the Court's case law, the margin of appreciation available to the legislator in implementing policies concerning pensions or welfare benefits, as well as employment policies, since they involve economic and social issues, should be a wide one.
GR1 (Government): In this context, the Court must respect not only the judgment of constitutional courts on the aims and necessity of the policy measures, but also the assessment of the democratically elected legislator, whose wide margin of discretion in such issues must be respected even by domestic judicial authorities pursuant to the principle of distribution of public powers.
GR1 (Government): In response to the applicants' comments challenging the legitimacy of the aims of the above measures on account of the termination of the excessive deficit procedure against Hungary by the European Union, the Government noted that having successfully curtailed an excessive deficit does not mean that a balanced budget has already been achieved or that the balance is sustainable.
GR1 (Government): Getting off the excessive deficit procedure doesn't mean that the State can resume spending the public budget in an unsustainable manner.
GR1 (Government): In response to the applicants' further comments on some budgetary spending not to his liking, the Government noted that from the perspective of sustainability, smaller but recurrent and long-term expenditures are far more significant than one-time large-scale public projects which, in any event, have far more complex budgetary effects than could be presented here even if they were relevant.
GR1 (Government): Mr. President, Honourable Members of the Court, Ladies and Gentlemen,
GR1 (Government): The general background of the measure complained of having been explained.
GR1 (Government): Next I will attempt to evaluate its effect on the applicant's situation.
GR1 (Government): However this exercise is greatly hindered by the fact that the applicant hasn't shared very much relevant information about his individual case but has tried to have this case determined on the general level of an actio popularis.
GR1 (Government): The applicant who was born in 1953 reached the statutory retirement age in 2016.
GR1 (Government): It is clear, therefore, that at the time of the event's complaint of the applicant was not the recipient of old-age pension as such but the beneficiary of an early retirement pension scheme.
GR1 (Government): He has enjoyed these benefits since 2001, since his age of 47.
GR1 (Government): He retired after 30 years of service.
GR1 (Government): Neither the applicant nor his employer had ever paid any additional pension contribution in order to cover the additional costs of the preferential pension treatment embodied in the longer disbursement period.
GR1 (Government): The applicant then continued to work in the public sector and benefited from the possibility of drawing double income from the public budget for more than 12 years.
GR1 (Government): Until 2007 he hadn't even had to pay pension contribution.
GR1 (Government): His pension alone was higher than average and we must presume he received an even higher salary.
GR1 (Government): The applicant's pension in 2013 was approximately 540 euro while the average pension was 320 euro, about the same as the gross minimum wage.
GR1 (Government): And the average net income was about 500 euro.
GR1 (Government): In 2012 more than 90,000 people received less than one third of the applicant's pension and about 1.3 million, more than half of the 2.2 million pensioners, received no more than
GR1 (Government): two thirds of the applicant's pension.
GR1 (Government): Only about 2 to 300,000 persons received higher amounts of pension than the applicant.
GR1 (Government): The highest pensions were mostly earned by significantly longer service periods by continuing to work well after the retirement age without simultaneously receiving pension benefits.
GR1 (Government): In contrast, the applicant retired after 30 years of service.
GR1 (Government): Thus the applicant had already had his fair share of solidarity as a recipient in the pension system when the restriction complaint was introduced.
GR1 (Government): In light of the above statistical data, the applicant having to make a choice between his two sources of income from the public budget did in no way endanger his subsistence.
GR1 (Government): In 2013 the minimum subsistence amount for an active adult was about 290 euro and it was 210 euro per person in an average household.
GR1 (Government): In the same period the net minimum wage was 2 to 300 euro depending on tax reliefs.
GR1 (Government): Therefore the applicant was in a more favorable position with respect to either of his sources of income than the average person in any group of income recipients.
GR1 (Government): It was only after 12 years of enjoying the benefits of solidarity when the applicant was expected to share some of the burdens of that solidarity as a member of a privileged group of public servants.
GR1 (Government): He was not deprived of any of his pension benefits by the discretion of the authorities.
GR1 (Government): Similarly to the applicant in the Panfila versus Romania case, the applicant in this case was given an option to choose between being employed and being retired.
GR1 (Government): The only essential difference was that the Romanian legislation presumed that the persons concerned would choose their pensions and in default of the employee's decision to the contrary provided for dismissal from employment while the Hungarian legislature presumed that the persons concerned would choose to keep their full salary instead of their pensions and adopted rules for the suspension of the disbursement of pensions.
GR1 (Government): Thus it was the result of the applicant's own decision that the disbursement of his pension was temporarily suspended in order to enable him to enjoy the greater benefits of being employed in the public service.
GR1 (Government): Moreover although the payment of the pecuniary benefits was suspended for the relevant period, the applicant retained his legal status as a pensioner and continued to enjoy an ancillary benefits of an in-kind nature dependent on the status of pensioners which were although not part of the insurance expectations, sufficiently significant to prompt thousands of former service pensioners like the applicants in the case of Markovic and others to complain about their losses to an international tribunal.
GR1 (Government): Furthermore in a longer term, suspension of the disbursement of the pension was rewarded with an increase of salary and a corresponding more sufficient increase of the amount of the pension by 0.5% of the average salary earned during the suspension in accordance
GR1 (Government): with Article 22A of the Pension Act.
GR1 (Government): This measure was first introduced in 2007 on a voluntary basis available at the request of the pensioner which proves that this arrangement can be favourable to pensioners in the long run.
GR1 (Government): Therefore the interference complained of similarly to the cases of Markovic and others didn't amount to a deprivation of possessions within the meaning of the second sentence of the paragraph of Article 1 of Protocol No. 1.
GR1 (Government): It is rather to be regarded as an interference with the applicant's right to the peaceful enjoyment of his possessions within the meaning of the first sentence of the first paragraph in light of the effort set the legitimate aim of the interference cannot be called into question and the applicant cannot be considered to have had to bear an excessive individual burden of solidarity in the course of creating a fairer system of public burden sharing and a more sustainable structure of public expenditures.
GR1 (Government): Mr. President, Honourable Members of the Court, Ladies and Gentlemen, the next issue we must
GR1 (Government): examine is whether the applicant was in a position analogous to any of the groups of persons whom he claims were treated more favourable than himself in breach of the prohibition of discrimination under Article 14.
GR1 (Government): The grounds for the prohibited different treatment enumerated in Article 14 in an open-ended manner can be explained in terms of the most basic personal characteristics of an individual.
GR1 (Government): Although other status has been interpreted by the Court to include status as a civil servant, it was only to conclude that civil servants were not in analogous position to workers of the private sector for pension purposes or that the difference of treatment was justified by the legal differences of the respective statuses.
GR1 (Government): The Government are of the opinion that the legal status as a civil servant can hardly be regarded as a defining element of someone's personality and therefore the option of leaving civil service as a means to avoid any disadvantages attached to that status cannot be compared to changing a person's nationality and thus the Court's finding in the case of Andreeva v Latvia have no relevance to the present case.
GR1 (Government): Furthermore, the Government do not claim that the applicant could have avoided discrimination by changing his legal status as a civil servant but that he could have avoided the adverse effects of the measure complained of by changing that status.
GR1 (Government): Not all adverse effects of a measure amount to discrimination.
GR1 (Government): In the present case, the different treatment based on the nature of an employment relationship resulting in the creation of various categories of civil servants with different legal statuses is a different treatment based on factual differences and characteristics of an objective and reasonable nature.
GR1 (Government): In such circumstances, such a difference doesn't amount to discriminatory treatment within the meaning of Article 14 of the Convention.
GR1 (Government): As regards the difference in treatment between retired persons who were still active in the private sector and those who were in the public sector, like the applicant, the Court clearly saw in the case of Pamfila v Romania that the two categories of persons can hardly be regarded as being in an analogous or relevantly similar situation within the meaning of Article 14, since the essential distinction is that they drew their incomes from different sources, namely a private budget and a state budget respectively.
GR1 (Government): It was only in the present case that the Chamber found the two groups to be in analogous position by relying on the single common feature, namely that they didn't need an income substitute since they all had an income from work, which is not relevant from the perspective of the aims pursued by contested measure, but only an aspect to be taken into account in assessing its proportionality.
GR1 (Government): From the perspective of the reasons for introducing the restriction, the two groups were in a different position in many essential aspects.
GR1 (Government): Another distinctive feature is that in respect of public employees, the State is not only in the position of a regulator in the field of employment policy, but it is in the position of the employer, and thus it can directly execute its employment policy without having to consider implications of interference with private law relationships.
GR1 (Government): Further differences, and this will also explain the difference of treatment between certain categories of employees within the public sector itself, that public servants subjected to the restriction complained of have a special duty of loyalty to the State and an obligation to observe certain ethical norms which are not applicable to those who are employed in the private sector or under the rules of the labor code.
GR1 (Government): The restriction introduced by the contested legislation corresponds to an ethical obligation not to abuse the law.
GR1 (Government): Although enjoying retirement benefits without actual retirement was not illegal, it was unethical in the sense that it maximized personal advantages to the detriment of the community, especially to the detriment of those who were in bigger need of social solidarity.
GR1 (Government): As to the alleged discrimination within the public sector itself, which complaint was not raised before the court within the six-month time limit, the government knows that in Hungary there are a number of various categories of civil servants with legal statuses defined by different set of rights and obligations.
GR1 (Government): The common denominator is not only that they are paid from the public budget, but they also enjoy special privileges as compared to those employed under the rules of the labor code in terms of job security and protection against dismissal from service, and in turn they are subject to a special duty of loyalty to the state and to the obligation to observe some rules of ethics, both in the professional conduct and private lives.
GR1 (Government): All these categories of civil servant are subject to the restriction under Section 83C of the Pension Act.
GR1 (Government): Therefore the issue of different treatment between various categories of civil servants doesn't arise.
GR1 (Government): Prison prosecutors on administrative leave or in reserve status seem to be the exceptions.