The new bill from the Ministry of National Economy and Finance introduces significant increases in pensions for specific categories of public-sector insured individuals, as it reinstates the link between pension benefits and the salaries of active public officials and employees.
The key change stipulates that beneficiaries’ pensions will amount to 80% of pensionable earnings, a percentage that leads to a substantial increase in benefits for both new and existing retirees in these specific categories.
The provisions apply to individuals who were excluded from the pension calculation system established by the Katrougkalos Law and retained the special public sector pension scheme.
At the same time, it is provided that the changes will also apply to those who have already retired after January 1, 2017, a fact that creates the conditions for retroactive increases in the pensions being paid.
The scope of application includes public officials and employees, both civilian and military, who have become totally disabled as a result of a terrorist act, a murderous attack, or while performing duties involving increased risk.
Eligible recipients include both salaried and unsalaried public officials, as well as ministers, members of parliament, mayors, community presidents, members of administrative boards, and employees of broader public sector entities subject to the relevant pension provisions.
Of decisive importance is the provision that a disability rate of 67% or higher, as certified by the competent medical committees, is recognized as total disability. For these beneficiaries, the pension will not be calculated solely based on the rank they held at the time of retirement, but based on the career progression they would have had if they had continued their service normally.
Specifically, for civil servants, the final rank or pay grade to which they would have advanced is taken into account, increased by the corresponding length-of-service allowances and pay increments corresponding to 35 years of actual service.
A similar approach is followed for military personnel, with specific limits on rank progression per personnel category. For enlisted personnel, an additional guarantee is provided so that their pension does not fall short of the corresponding war disability pension for the same disability percentage.
A key element of the new framework is the re-linking of pensions to the salaries of active-duty personnel. In practice, any future increase in base salaries or pensionable allowances will be automatically reflected in the pensions of beneficiaries, even if they left the service years ago.
This creates a permanent adjustment mechanism, eliminating the need for specific legislative measures to increase these pensions.
Pensionable earnings will include the base salary, as well as specific allowances recognized by law as pensionable and on which social security contributions are levied for the main pension.
These include the fixed allowance and length-of-service increment for judicial officers, the teaching and research allowance for university faculty, the hospital employment and special conditions allowance for doctors in the National Health System (ESY), the special research allowance for researchers, the special duties allowance for diplomatic staff, as well as part of the position of responsibility allowance for heads of organizational units.
In addition, the hazardous and unhealthy work allowance is also taken into account when it was being paid at the time of separation from service.
Conversely, productivity allowances, appearance fees, travel expenses, and other benefits that are not considered pensionable remain excluded from the calculation, unless there is a specific provision stipulating otherwise.
In fact, the same provisions apply to supplementary pensions, dividends, lump-sum benefits, and benefits from equity and supplementary funds, as if the beneficiaries had completed a full period of insurance coverage. This provision could lead to a significant overall increase in beneficiaries’ incomes, as it affects all pension benefits.
Special provisions are made for victims of terrorist acts and violent crimes related to the performance of their duties. These beneficiaries will be able to retire regardless of the number of years of service they have completed, while their pension will be calculated based on the final rank they would have attained during their normal career progression.
At the same time, the new framework strengthens the protection of the families of those who lost their lives in the line of duty. In many cases, the pension will be calculated as if the deceased had completed 35 years of pensionable service, significantly increasing the amounts received by surviving beneficiaries.
Similarly, provisions for the families of the victims of the Tempi tragedy are being expanded, as parents of the deceased who were widowed or divorced without children are now also eligible, while full transfer of the share is provided for in the event of the death of one parent.
The same bill raises the age limit for granting a survivor’s pension to the children of pensioners. Under the new provision, the benefit will continue until they reach the age of 24, provided they remain unmarried.
The bill also provides for a new method of calculating the disability allowance, which will be linked to the base salary of the beneficiary’s rank or pay grade. Finally, it includes a provision whereby the State waives the recovery of amounts unduly paid that resulted from computer errors during the recalculation of pensions and retroactive payments for previous years.