Supreme Court to discuss pension reform in August

Supreme Court of Estonia building, in Tartu.
Supreme Court of Estonia building, in Tartu. Source: Supreme Court of Estonia

The Supreme Court is set to discuss on August 4 the application of President Kersti Kaljulaid to declare the law on the reform of the system of mandatory funded pensions, adopted by the parliament without changes for a second time in mid-March, to be inconsistent with the Constitution.

The Riigikogu first adopted the law on the mandatory funded pension reform, which seeks to do away with a mandatory funded pension, on January 29 this year. After the president had refused to sign the bill into law on February 7, the parliament passed the bill in the unchanged form again on March 11 and on March 16 submitted the bill to be promulgated by the president.

The head of state decided again not to promulgate the pension reform bill and turned to the Supreme Court with an application to declare the bill inconsistent with the Constitution.

"In accordance with the Constitution, the Riigikogu has wide-ranging authority to organize matters in the social sphere," the head of state said, turning to the Supreme Court.

"This includes the right to alter the pension system within the framework we, as a society, have agreed upon in the Constitution. However, the solution currently being offered disproportionately infringes upon people's constitutional rights and is, in a number of places, in contravention of both the principle of legitimate expectation and the principles of the social state and state based on the rule of law set out in the Constitution," she said.

Kaljulaid also emphasized that in the case of an issue which has this broad a scope and impact on society as wide-ranging changes to the pension system has, it is important for questions to be asked and answered at every possible level, with the Supreme Court ultimately providing clarity and a solution that is acceptable to everyone.

Furthermore, the president observed that the system of mandatory funded pensions has been in effect for over 17 years and by the present time a significant proportion of the population, over 740,000 people, have joined it.

According to the head of state, these people have a legitimate expectation arising from the Constitution that the pension system will remain valid for them principally as long as they need it.  

President Kaljulaid has petitioned the Supreme Court once before, in regard to the act expanding the surveillance rights of the Estonian Defense Forces, which the Supreme Court found to be partly unconstitutional. Since Estonia regained its independence, presidents have petitioned the Supreme Court to exercise constitutional oversight a total of 15 times.


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Editor: Katriin Eikin Sein

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