Public Interest vs. Private Property: Some National Austerity Measures in the Jurisprudence of European Courts

Background and analysis to the judgments of the European Court of Human Rights application no. 78117/13 and of the CJEU in cases C-285/14 and C-64/16.

Abstract

Through the comparative analysis of the ECHR Grand Chamber Judgment reached upon the appeal of the Hungarian Government in Fábián v. Hungary (app. no. 78117/13) and CJEU judgments C-258/14. and. C-64/16., this paper examines that in the aftermath of the economic and financial crisis what kind of external fundamental rights barriers should be observed by those states that intend to adopt measures restoring budgetary balance but have a limited legal room for maneuver based on scarce financial means and, in parallel, on the obligations and measures prescribed in the EU legal system. This is especially interesting in cases where – in addition to the pension – these measures prohibit the joint payment of wages and pensions for people working in the public sector.

Following the summary introduction of the general legal background, i.e. firstly the legal frames of financial crisis management, and secondly the legal means for the protection of individual rights, this analysis will examine the general conclusions of the judicial decisions at hand, then turns to the detailed analysis of each of the decisions upon underlining important differences and similarities significant from the standpoint of a comparative methodology.

While there are substantial discrepancies regarding procedure and legal basis between the procedural rules of the respective courts and between the legal systems underlying the judgments, by reason of the similarity of the facts of these cases (i.e. limiting the accumulation of pensions and wages earned in the public sector with an eye on restoring budgetary balance) it is worthwhile to summarize what are the legal grounds in the European courts that qualify such state measures as lawful, which are attacked based on similar legal grounds in terms of the field of law concerned (protection of fundamental rights) and of the rights protected (property and equal treatment).

All in all, the results of the analysis show that albeit we see clashes between the legal arguments regarding the principle of equal treatment especially in the Strasbourg jurisprudence, the public policy (i.e. reduction of budgetary deficit), on which the measures are based is a sufficient basis for the limitation of fundamental rights, if the necessity (subject to a restricted scrutiny in front of these courts) and proportionality (primarily regarding their temporary nature) of these measures can be determined.