Update: 10.01.2024 11:21
Presented by: 10.01.2024, 09:23
Brno – Today, the Constitutional Court (ÚS) began to publicly discuss the proposal to repeal the law that reduced the pension assessment last year. Hence pensioners were added less than expected. The Chamber of Deputies is full, and from 7:00 people are gradually arriving, among them are students and seniors, lawyers and politicians. The proposal to repeal the law was submitted by a 71-member committee of the ANO movement. Former finance minister Alena Schillerová and lawyer David Razovsky will act on their behalf in court. The government's position is defended by Minister of Labor and Social Affairs Marion Jurecka (KDU-ČSL).
The president of ÚS, Jozef Baxa, warned the politician in advance that the court's proceedings were “of a different type” than parliamentary debates. He expects from them substance in their presentations, not politics, but constitutional-legal argumentation.
Schillerova told reporters that she was coming to ÚS with full confidence. According to him, the government has impermissibly gone backwards, thus defying the reasonable expectations of the pensioners. In addition, it misused the legislative emergency, knowing in advance that inflation would require an extraordinary review in 2022 and early 2023, so that the money could be prepared in the budget. “They knew a few months ago that there would be such inflation and that there would be such a big demand. The fiscal outlook of the Ministry of Finance from 2022 spoke about it, the National Budget Council drew attention, and there was a big zero in it. Budget,” Schillerova said.
“As a government, we stand behind the procedural order,” Jureka said. According to Jurečka, if the government assesses pensions according to the normal legal mechanism under conditions of price inflation, this will threaten the long-term sustainability of public funds, which is why it once prepared a different legal regulation. and low abnormal value. “The government acted responsibly and not arbitrarily,” the minister said. The leadership of the Chamber of Debates or the Senate does not participate in the meeting.
ANO parliamentarians submitted the proposal last May. According to them, the abnormal devaluation in conditions of sharp price growth backfired and distorted pensioners' expectations. Using the standard legal mechanism, which is activated when prices rise by more than five percent, the average pension will increase by 1,770 crowns in June, compared to 760 crowns after the revision. Last year alone, the government saved 19.4 billion crowns.
Court proceedings will probably last all day. Experts, namely economists and statisticians, will testify in the afternoon along with Finance Minister Zbyněk Stanjura (ODS). “In the first part, as a representative of the government I am ready to defend the actions and decisions of the government to adjust the abnormal assessment, in the second part I have been called as a witness, so I am ready to testify. Statement,” Jureka told reporters. Stanjura is already in the hall, as well as ANO MP Aleš Juchelka or SPD MP Lucie Šafranková.
No decision will be made today. Baksa said the court will adjourn the hearing indefinitely after final submissions. He recalled that the court has already dealt with the issue several times in closed sessions and will continue to do so after today's session.
The Budget Council chairman said the price hike in 2022 and early 2023 is shocking.
The living expenses of pensioners in 2022 and the beginning of 2023 were very high and surprising, the head of the National Budget Council, Mojmir Humble, told the Constitutional Court (ÚS) today. According to him, it was foreseeable that inflation would lead to the need for extraordinary valuation of pensions, the question was when and how much. However, Hambl said he could not predict a specific figure for inflation in January 2023. For him, it was a shock.
“I don't know anyone who knew she would be this tall,” Hamble said. He testified in court last year in proceedings over a proposal by ANO representatives to cancel the extraordinary pension assessment, which fell short of the standard legal mechanism. The government justified this with budgetary responsibility, but according to ANO, it exceeded the reasonable expectations of pensioners.
Hamble pointed out that general inflation and the cost-of-living index for retirees are two different numbers. The latter is important for the valuation of pensions, i.e. the so-called pension inflation. During periods of rapid price growth, specific values are volatile and difficult to predict. Hambl described the Czech economy as moving “from the Polabian Plain to the Krkonose Mountains”.
“It was by no means possible to fairly calculate the amount of pension inflation, which was a surprise to everyone,” said Hambl, who had to answer questions from the judges. For example, Vojtěch Šimíček, the vice-president of the court, asked about the long-term budgetary consequences if the government did not reduce the extraordinary assessment and used the normal legal mechanism. The government will spend hundreds of billions more over the next few decades, Hamble acknowledged.
According to the law, pensions are regularly increased starting in January, with exceptions if prices rise by more than five percent during the monitored period. Last June, the government revised pensions, but not significantly in line with the figures of the period.
Consumer prices in the Czech Republic increased by 17.5 percent year-on-year in January 2023. The cost of living for pensioners has also increased significantly.
