CEDH · CASELAW;CLIN;ENG — 10 juillet 2018

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Italy (dec.) - 27166/18 and 27167/18 Decision 10.7.2018 [Section I] Article 1 of Protocol No. 1 Article 1 para. 1 of Protocol No. 1 Peaceful enjoyment of possessions Reduction in inflation-linked uprating of old-age pensions: inadmissible Facts – In 2011 Legislative Decree no. 201 provided for the freezing, in 2012 and 2013, of the inflation-linked uprating of old-age pensions which were more than three times the guaranteed minimum amount. In 2015 the Constitutional Court found that the provision was disproportionate and insufficiently reasoned. A new Legislative Decree no.   65 retroactively amended the provisions that had been declared unconstitutional, introducing five different levels of uprating ranging between 0 and 100% of inflation depending on the amount of the pension. The applicants are pensioners whose pensions were reduced by the freezing or limiting of the uprating pursuant to the legislation of 2015 (by way of comparison, the mechanism provided for by the previous legislation had been much closer to the rate of inflation, especially for the highest pensions). In 2017 the Constitutional Court took the view, however, that the legislature had complied with its previous ruling of 2015. Law – Article 1 of Protocol No. 1: The aims pursued by the Italian legislature had been clearly identified in Legislative Decree no.   65/2015, in the reports accompanying the ratification law, and in the Constitutional Court’s analysis. It was a question of, on the one hand, bringing the legislation into conformity with the Constitutional Court’s judgment of 2015, while ensuring budgetary stability and control over public expenditure, and on the other, of protecting a minimum level of welfare benefits and ensuring the sustainability of the social security system for future generations. However, in the context of implementing social and economic policies, the legislature had significant latitude. The Court did not see any reason in the present case to dismiss the considerations of the Constitutional Court or question the fact that the Italian legislature was pursuing a public-interest aim, which was necessarily a broad concept. The proportionality of the interference could not be assessed in the abstract, having regard purely to the amount or percentage of the reduction sustained: all relevant factors had to be taken into account and placed in context. Legislative Decree no. 65/2015 had not affected the nominal amount of the pension, but had reduced, with erga omnes effect, the mechanism for the uprating of the pension in line with the cost of living. For the years in question (2012 and 2013), that index has only risen by 2.7% and 3% respectively. The impugned measure did not appear to have had a significant impact in respect of the years in question: for 2012 the legislation had no impact on pensions of less than about EUR 1,500 and the reduction rose to 2.7% for pensions higher than about EUR 3,000. The result was similar for 2013. As regards the alleged impact of this measure from 2014 onwards, by way of cumulative repercussion ( trascinamento ), the Court did not share the applicants’ opinion that their pension rights, once acquired, could never be amended for subsequent years. To reduce or amend the amount of social security benefit fell within the legislative authority of the State. In addition, the legislature had been obliged to intervene in a difficult economic context. The Legislative Decree in question had sought to provide for redistribution in favour of lower pensions, while preserving the sustainability of the social security system for future generations. The Italian government’s room for manoeuvre had been restricted on account of the limited resources and the risk that the European Commission might take action for an excessive budget deficit (the effects of the Constitutional Court’s 2015 judgment risked pushing the deficit above 3% of GDP). In its 2017 judgment, in order to find the impugned system to be fair and proportionate, the Constitutional Court noted first that the curbing of pension uprating would be applied gradually, depending on the amount of the pension (based on five categories), and secondly that the adjustment lost in 2012 and 2013 on account of the limitation in uprating would be fully recovered from 2014 onwards. Thus, the effects of the reform of the uprating mechanism on the applicants’ pensions had not been of such a level that they had encountered hardship incompatible with Article   1 of Protocol No.   1. The impugned interference had not placed an excessive burden on the applicants. Conclusion : inadmissible (manifestly ill-founded). (See also the Factsheets on Austerity measures and Elderly people )   © Council of Europe/European Court of Human Rights This summary by the Registry does not bind the Court. Click here for the Case-Law Information Notes