Greece’s top administrative court, the Council of State, ruled this week that pension cuts adopted in 2012 as part of the country’s tough bailout conditions at the time are unconstitutional, and has ordered the government to restore the payments to previous levels.
The government has implemented waves of pension cuts since 2010 as part of austerity measures agreed with its international lenders to put its finances back on track.
The court’s decision, which is not retroactive, calls for the government to restore the pensions to the level they were at before a November 2012 law came into force, lowering main and supplementary pensions by between 5 and 10 per cent.
In recent years the court debated many of the painful austerity measures Greeks have faced. Last year the Council found that wage cuts for police, the military and firefighters were also unconstitutional.
Antonis Samaras’ government took months to comply with the ruling and only partially restored the salary levels, citing budgetary constraints.
Wednesday’s pension ruling is expected to cost the state 1.2 to 1.5 billion euros ($A1.76-$A2.20 billion) a year, according to Greek economic analysis site Macropolis.
Source: The Economic Times/The Telegraph