NEWS

Ruling on pension cuts will cost state 1 to 1.5 bln euros

The government will have to find 1 to 1.5 billion euros to cover the cost of a Council of State decision published on Wednesday, which calls for pensioners in the private sector and at state-owned corporations (DEKOs) to have their retirement pay restored to 2012 levels.

In a majority decision (14 vs 11), Greece’s highest administrative court judged the reduction to main and supplementary pensions legislated in late 2012 as being unconstitutional. The ruling affects some 800,000 pensioners who earned more than 1,000 euros a month.

It is estimated the decision will lead to pensions between 1,000 and 1,500 euros rising by 5 percent, those between 1,500 and 2,000 increasing by 10 percent and those over 2,000 seeing a rise of 15 percent. The court said the government should have carried out a study on the impact these cuts would have had on the pensioners affected.

The Council of State, however, decided that pensions should not be restored retroactively apart from some 2,000 individual cases where pensioners appealed the reductions on their own. This means that, apart from the latter cases, the government will have to find a way to increase the pensions in question from this point on rather than find the funds to cover the income the pensioners lost as a results of the cuts over the last 2.5 years.

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