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May 14, 2021

Constitutional Court rules unconstitutional law on special pensions for local elected officials

In considering a constitutionality objection from the Government, the Constitutional Court of Romania (CCR) on Wednesday ruled unconstitutional a law on special pensions for local elected officials.

The Government’s notification referred to the constitutionality of  Law No. 393/2004 on the status of local elected representatives.

On June 27, Prime Minister Dacian Ciolos announced that the Executive had again challenged the Special Pensions Law with the CCR.

“The law is not clear on how those special pensions or indemnities will be financed. According to the current wording of the law, these benefits would continue to impact the state budget because local budgets too are largely fueled from the state budget. And, on the other hand, the principle of contribution-proportional earnings is not observed, this law would apply retroactively, so we have asked again the CCR to clarify whether these elements, which are still maintained in the law, are constitutional,” Ciolos said at that time.

The Premier added that the budgetary impact of enforcing the law passed by Parliament in its present form is around 400 million lei a year.

Ciolos reminded that the Government had challenged this law for the first time when Parliament decided on the special pensions and said that the objections raised and accepted by the CCR back then have not been “not integrated” by the lawmaking body.

According to the Prime Minister, the idea of special pensions is prone to affecting the very consolidation of the pension system. “The idea of special pensions, if we have many such special pension categories, (…) may affect the very consolidation of the pension system in Romania,” added the head of the Government.

In the notification, the Government said that the provisions of the regulatory act establish an exceptional legal regime that favors a restricted category of citizens, and it will also be applied to those who were mayors, deputy mayors, presidents or vice presidents of county councils prior to the entry into force of this law, without any time limit. The Government cautions that beyond the retroactive enforcement of the law, the lengthy period of its scope is unprecedented in Romanian legislation.

The law also creates a double discrimination between people of the same category, ie those who hold or have held a public dignity, but also that there is no prior analysis of the number of beneficiaries and a budgetary impact, and the budgetary sources for covering these additional costs have not been established.

The Government also argues that the law’s provisions are flawed by vague, unclear, confusing and imprecise wording and therefore they are unpredictable.

On December 26, 2015 the Government notified the CCR on particular aspects of the law on the special pensions for mayors, deputy mayors, County Council presidents and vice-presidents – Law amending and supplementing Law No. 393/2004 on the status of local elected representatives.

In January, the CCR admitted the Government’s notification and decided that the provisions on special pensions for the local elected are unconstitutional.

The decision was taken unanimously. The judges found that the law is not clear, that there is inequality between the elected officials and that the financing source is not specified.

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