SOROCINSKIS v. LATVIA
Inadmissible
André Potocki;Angelika Nußberger;Erik Møse;Mārtiņš Mits;Síofra O’Leary;Gabriele Kucsko-Stadlmayer
1. The applicant, Mr Georgijs Soročinskis, is a Latvian national who was born in 1938 and lives in Rīga. He was represented before the Court by Ms I. Nikuļceva, a lawyer practising in Riga. 2. The Latvian Government (“the Government”) were represented by their Agents, Ms I. Reine and subsequently by Ms K. Līce. 3. The facts of the case, as submitted by the parties, may be summarised as follows. 4. On 20 November 1998 the applicant requested a retirement pension. At that time the applicant had the status of “permanently resident noncitizen” of Latvia; thus, in accordance with paragraph 1 of the transitional provisions of the Law on State Pensions, the periods that he had spent in employment outside the territory of Latvia were not taken into account. Furthermore – under paragraph 13 of the transitional provisions of the Law on State Pensions – in view of the fact that the applicant had worked in Latvia for less than thirty years, his own average monthly “insurance wage” (that is to say the income in relation to which the insurance was paid) instead of the “average monthly insurance wage in the State” (that is to say the average monthly insurance wage of all insured persons in any given calendar year) was taken into account for the purpose of calculating his pension. Accordingly, his monthly pension was set at 9.96 Latvian lats (LVL – approximately 14 euros (EUR)). As this sum was lower than the minimum pension set by the Cabinet of Ministers, the applicant in fact received LVL 31 (approximately EUR 43). 5. On 11 June 1999 an agreement between Latvia and Ukraine on cooperation in the field of social security entered into force, and on 17 June 1999 the applicant applied for a recalculation of his pension to take into account the periods during which he had worked in Ukraine. On 9 February 2000, on the basis of having acquired citizenship of Latvia, the applicant applied for a further recalculation to take account of the remaining periods during which he had worked abroad. The State Social Insurance Agency took into account the periods during which the applicant had worked abroad when determining his aggregate insurance period (for a definition of “insurance period” see paragraph 16 below) as being forty years and twenty-three days; however, as the employment periods accumulated in Latvia had not increased, his own average monthly insurance wage (and not the average monthly insurance wage in the State) was again taken into account in the calculation of his pension. Even with those additions, the applicant’s pension was still below the level of the minimum pension, as set by the Cabinet of Ministers. Thus, after the formal recalculation of his pension, the pension the applicant actually received did not increase. On 1 January 2002, in accordance with amendments to the Law on State Pensions, the applicant’s pension was raised to LVL 45.00 (approximately EUR 62), which was the minimum pension for persons whose insurance period exceeded thirty years. 6. The applicant continued working, and on 2 July 2003 he applied for yet another recalculation of his pension. On 11 September 2003 the State Social Insurance Agency recalculated the applicant’s pension on the basis of the insurance contributions he had made following his retirement. It took the additional time period worked into account in determining the applicant’s aggregate insurance period. However, as the period the applicant had been employed in Latvia still did not reach thirty years, the average monthly insurance wage in the State was not taken into account in the calculation of his pension. Thus, for a total employment period of forty-one years eleven months and twenty-eight days the applicant’s pension was set at LVL 25.09 (approximately EUR 34) per month. Therefore, the applicant continued receiving the minimum pension for persons whose insurance period exceeded thirty years, which by then had been raised to LVL 46.04 (approximately EUR 63). 7. As the applicant continued working, his aggregate insurance period reached forty-two years ten months and twenty-eight days. As of 1 August 2016 his monthly pension was raised to EUR 190.12, with an additional supplement of EUR 37.85. 8. The applicant challenged the decision of the State Social Insurance Agency of 11 September 2003 before the administrative courts, complaining that following the entry into force of the agreement between Latvia and Ukraine on cooperation in the field of social security and after he had acquired Latvian citizenship his pension had not increased. He also noted that all the circumstances forming the basis of his complaint had been set out in his initial application of 2 July 2003. Invoking paragraphs 13 and 33 of the transitional provisions of the Law on State Pensions (see paragraphs 17-18 below) he requested that his pension be recalculated by taking into account the time he had worked in Ukraine. 9. On 25 February 2005 the Administrative District Court dismissed the applicant’s complaint. Having found that the crux of the applicant’s complaint was the alleged failure to take into account the periods he had worked in Ukraine, the court reassessed the decision of the State Social Insurance Agency and concluded that his pension had been calculated correctly. 10. The applicant appealed against this decision, stating that all the circumstances forming the basis of his complaint had been outlined in his initial application. The applicant invoked paragraphs 13 and 33 of the transitional provisions of the Law on State Pensions. On 29 June 2006 the Administrative Regional Court dismissed the applicant’s appeal. The applicant lodged an appeal on points of law on the same grounds. 11. On 15 December 2006 the Senate of the Supreme Court set aside the judgment of the Administrative Regional Court on the grounds that the court had not obtained and reviewed the applicant’s initial application of 2 July 2003 to the State Social Insurance Agency. As a result, the court had not been able to clarify the exact scope of the applicant’s complaint. 12. On 22 May 2007 the Administrative Regional Court examined the applicant’s complaint in oral proceedings. During his oral submissions the applicant emphasised that he requested that his pension be recalculated on the basis of the average salary in the country. His total employment period was forty-two years, whereas the Law on State Pensions required the insurance period to be no less than thirty years in order for the average monthly insurance wage in the State to be used in the calculation. Despite the fact he had worked for forty-two years, only seventeen years had been taken into account. The applicant concluded by stating: “If you are a citizen then everything is taken into account in the calculation, but if you are not then it is not.” The respondent (that is to say the State Social Insurance Agency) then requested the applicant to clarify the scope of the complaint, to which he replied: “I request the pension to be recalculated on the basis of the average salary in the country.” 13. On 14 June 2007 the Administrative Regional Court dismissed the applicant’s complaint. It observed that in his initial application of 2 July 2003 the applicant had requested that his pension be recalculated in accordance with general rules. It furthermore noted that the periods he had worked in Ukraine had been taken into account already since the agreement between Latvia and Ukraine on cooperation in the field of social security had entered in force. Furthermore, following the applicant’s acquisition of Latvian citizenship the periods he had worked in Russia and had spent in military service had also been taken into account. The decision that was being challenged concerned the increase in the applicant’s insurance period. Thus, the entirety of his insurance period of forty-one years eleven months and twenty-eight days had been taken into account in the calculation of his pension. In addition, the applicant was receiving the minimum State pension in the amount set for persons whose insurance period was above thirty years. With regard to paragraph 13 of the transitional provisions of the Law on State Pensions the court noted that the applicant’s pension had been calculated correctly, but in relation to paragraph 33 it observed that this provision was not applicable to the applicant owing to its temporal limitation. 14. In his appeal on points of law the applicant again reiterated that all the circumstances that formed the basis of his claim had been set out in the initial application. He also stated that his pension had not been recalculated on the basis of the amendments to the Law on State Pensions that had entered into force on 1 January 2002. These changes applied to persons whose insurance period was above thirty years, whereas his insurance period amounted to more than forty years. Despite that, his own salary (instead of the average salary in the country) had been taken into account when calculating the level of the pension to which he had been entitled. The applicant referred to paragraphs 13 and 33 of the transitional provisions of the Law on State Pensions, as well as to procedural provisions of the Administrative Procedure Law. 15. On 29 August 2007 the Senate of the Supreme Court rejected the applicant’s appeal on points of law, noting that it contained no arguments as to how the judgment of the Administrative Regional Court had contravened the legal provisions he had referred to. 16. The Law on State Pensions, which entered into force on 1 January 1996, provides that one of the components to be taken into account in the calculation and allocation of pensions is the “insurance period”. Under section 1 of the Law on State Pensions, the insurance period is the period of time over which an insured person has made social insurance contributions or such contributions have been made or should have been made on that person’s behalf. With regard to the time period prior to 1 January 1991 (when the social insurance system had not yet been established), paragraph 1 of the transitional provisions of the Law on State Pensions, as in force at time when it was applied to the applicant, provided: “1. In the case of Latvian citizens, repatriated persons, and their family members and their descendants, periods of employment and periods treated as equivalent to employment that have been accrued within or outside Latvia prior to 1 January 1991 shall count towards the insurance period, which is necessary for the allocation ([or] recalculation) of the State pension, irrespective of [any prior] payment of social insurance contributions. In the case of foreign nationals and stateless persons who were resident in Latvia on 1 January 1991, the insurance period shall be composed of periods of employment and periods treated as equivalent to employment that have been accrued within Latvia, as well as periods treated as equivalent to employment that have been accrued outside Latvia in the cases specified in sub-paragraphs (4), (5) and (10) of this paragraph. The following periods, which are treated as equivalent to employment accrued up to 1 January 1991 ... shall be considered as counting towards the insurance period to be taken into account in calculating the pension: ... (4) periods of study at higher-education institutions, and at other training institutions at post-secondary level; (5) periods of doctoral study, ... postgraduate education or ongoing vocational training; ... (10) time spent in places of detention by victims of political persecution ... [or] in exile, and time spent escaping from such places, those periods to be multiplied by three, or by five in the case of time spent in the [Soviet] Far North and regions treated as equivalent. ...” 17. Under paragraph 13 of the transitional provisions of the Law on State Pensions, with respect to the transitional period, another component that is taken into account in the calculation of the pension is the person’s average monthly insurance wage within a specified time period. Thus, with respect to persons who retired in 1998, that person’s average monthly insurance wage over twenty-four months from 1996 until 1998 was taken into account. If, however, (i) the person’s insurance period in Latvia was not less than thirty years (save for politically persecuted persons, in relation to whom a different methodology applied) and if the person’s average monthly insurance wage for the last twenty-four months was below the average monthly insurance wage in the State in 1997, or (ii) the person had been officially unemployed, the average monthly insurance wage in the State in 1997 was taken into account in the calculation of his or her pension. 18. On 1 January 2002 the transitional provisions of the Law on State Pensions were supplemented by paragraph 33, which provides that in calculating the pension payable to a person whose insurance period is not less than thirty years and whose average monthly insurance wage, as calculated in accordance with paragraph 13 of these transitional provisions, is lower than the average monthly insurance wage in the State in the period between 1 January 1996 and 31 December 1999, the average monthly insurance wage in the State over the said forty-eight months should be taken into account. The retrospective application of this provision is limited to pensions that were granted after 1 January 2000. 19. The Government submitted a letter of 7 September 2016 from the Ministry of Welfare, the relevant part of which stated: ““The favourable model of calculating a person’s pension” enshrined in paragraph 13 of the transitional provision of the Law would not be applied to a Latvian citizen in the following situations: 1) In January 1998 a Latvian citizen requests a retirement pension for a total insurance period of 32 years, of which 9 years are [accrued] in Latvia but 23 years [are accrued] in Georgia. The pension is calculated for 32 years but the average monthly insurance wage in the State is not taken into account in the calculation of the initial capital, as the insurance period in Latvia is below 30 years; 2) In January 2016 a Latvian citizen requests a retirement pension for a total insurance period of 40 years, of which 24 years are [accrued] in Latvia but 16 years [are accrued] in Estonia. In accordance with the legislation, Latvia grants and pays the retirement pension only for the 24 years [accrued] in Latvia; accordingly, the average monthly insurance wage in the State is not taken into account in the calculation of the initial capital, as the insurance period for which Latvia pays is below 30 years; 3) In January 2012 a Latvian citizen requests a retirement pension for a total insurance period of 38 years, of which 25 years are [accrued] in Latvia but 13 years [are accrued] in Belarus. In accordance with the Agreement between the Republic of Latvia and Belarus on the cooperation in the field of social security, Latvia grants the retirement pension only for the insurance period accrued in Latvia – the 25 years. Accordingly, the average monthly insurance wage in the State is not taken into account in the calculation of the initial capital, as the insurance period for which Latvia pays is below 30 years.”