Before the Grand Plenary of the Court of Audit, the General Commissioner of State, Georgios Voilis, backed a change to the way the Pensioners’ Solidarity Contribution (EAS) is calculated.
The Court of Audit’s Plenary, chaired by its president, Sotiria Ntouni, heard an application by its former president, Nikos Aggelaras, challenging the way EAS is calculated. He argues that it is unconstitutional and is also seeking retroactive repayment of the difference resulting from the non-progressive calculation of EAS deductions.
Konstantinos Remelis, a professor at the Democritus University of Thrace’s Law School, and Dimitris Bourlos, counsel for Mr Aggelaras, argued that the way EAS is calculated is unconstitutional.
They argued that calculating EAS by applying a single rate to the full amount of a pension — without excluding the portion up to €1,400 for pensions above that level, and without applying different rates to successive bands of the portion above €1,400 — violates Articles 2, 4, 5 and 25 of the Constitution.
The two lawyers also said that changing the way EAS is calculated would be fiscally neutral, while safeguarding the necessary fiscal stability and the sustainability of the state’s finances. Implementing the change would not require new measures, they said, but would simply reduce the annual amount accumulated through the withholding and the interest on capital built up over the past 16 years. The former Court of Audit president also made a submission.
Representing the State were Anastasios Koloutsos, Vice-President of the State Legal Council, and Dimitris Farmakis, legal adviser, who defended the constitutionality of the current method of calculating EAS.
Mr Koloutsos said Mr Aggelaras’s arguments were not supported by the spirit of the constitutional provisions or the legislation, and that he had not clearly set them out. The State’s representative added that the way EAS is calculated did not adversely affect pensioners’ living standards, and stressed that the state respects citizens’ financial circumstances.
He also said that the way EAS is calculated serves the public interest and that Mr Aggelaras’s application should therefore be dismissed as inadmissible.
Georgios Voilis then said that, as a result of the way EAS is calculated, pensioners suffer financial losses of between €7,000 and €8,000 a year, depending on the size of their pensions, with those on higher pensions affected much more severely.
Mr Voilis also said that the non-progressive calculation of EAS, combined with the fact that only pensions of up to €1,400 are exempt from the charge while those above that level are not, is incompatible with the constitutional provisions and is therefore invalid. The way EAS is calculated must be overhauled and set by pension band, he argued.
On retroactive application, Mr Voilis said it should apply only to those who have brought proceedings before the courts, to avoid financial disruption to the funds. He noted, however, that the Plenary would have the final say on the question of retroactivity.
In the coming days, a rapporteur will be appointed to the case. The court’s members will then hold one or more closed-door deliberations, the text of the ruling will be drafted, and the decision is expected to be published in the first months of next year.
SOURCE: AMNA