Legal consequences of recalculation of pension for servicemen due to change in subsistence minimum for able-bodied persons is termination of payment of pension supplement in the amount of UAH 2,000.00 and indexation - SC AdmCC

The model case resolved a dispute over the correctness of the calculation and payment of a pension to a pensioner - a former serviceman, to whom the pension authority, on the basis of a court decision, recalculated and paid a pension taking into account the subsistence level established on 1 January of the calendar year, and stopped paying a pension supplement of UAH 2,000.00 and indexation for 2022 and 2023.

Based on the results of consideration of the model case, the Supreme Court dismissed the claims in view of the following. 

An increase in the subsistence minimum for able-bodied persons established by the Law of Ukraine on the State Budget for a particular year results in a change in the amount of military personnel's remuneration (official salary) as of 1 January of the calendar year and is the basis for recalculating the pensions of former military personnel in accordance with Articles 43 and 63 of the Law of Ukraine ‘On Pensions for Persons Discharged from Military Service and Certain Other Persons’ (Law No. 2262-XII). This pension recalculation arose on the basis established by the legal act.

Regarding the legality/illegality of the termination of the pension supplement in accordance with CMU Resolution No. 713, the SC AdmCC noted that the provisions of this Resolution link the termination or change of the monthly pension supplement in the amount of UAH 2,000.00 to the revision (recalculation) of the pension, without specifying the legal and factual basis for such revision, but indicate the purpose of payment of such supplement (gradual reduction of disproportions in the amount of pensions) and the grounds for termination of its payment (increase of pension by more than UAH 2,000.00). Therefore, the recalculation of pensions due to the increase in the subsistence minimum for able-bodied persons established by the Law of Ukraine on the State Budget for a particular year, which resulted in a change in the amount of military personnel's financial support (official salary), is the increase that is referred to in subpara. 3, para. 1 of CMU Resolution No. 713 links the termination or change (reduction) of the amount of the monthly supplement provided for by this regulatory act.

Since the recalculation of the plaintiff's pension was carried out precisely in connection with the increase in the subsistence minimum for able-bodied persons (regardless of whether pursuant to a court decision or on the basis of a certificate directly submitted by the authorised body to the pension authority), there are no grounds for paying him a monthly supplement in the amount of UAH 2,000.00 provided for by CMU Resolution No. 713, since the pension was increased during its recalculation due to the increase in the subsistence minimum for able-bodied persons for the relevant year.

Regarding the legality/illegality of termination of indexation payment in the amount provided for by CMU Resolutions No. 118 and No. 168, the SC AdmCC, taking into account the mandatory provisions of subpara. 3 of para. 2 of CMU Resolution No. 168 that the increase by the increase coefficient established by para. 1 of this Resolution is also applied in the case of pension recalculation in accordance with Law No. 2262-XII, except for recalculations in connection with the increase in the financial support of the relevant categories of military personnel, persons entitled to a pension under this Law, concluded that the recalculation of a pension due to an increase in the subsistence minimum for able-bodied persons established by the Law of Ukraine on the State Budget for a particular year, which resulted in a change in the amount of military personnel's remuneration (official salary), is a ground for termination of indexation payments. Thus, since the plaintiff's pension was recalculated from the increased amount of remuneration as of 1 January 2021, 1 January 2022, and 1 January 2023 pursuant to the court decision, there are no grounds for its indexation under the provisions of CMU Resolutions No. 118 and No. 168.

Thus, the recalculation of pensions due to the increase in the subsistence minimum for able-bodied persons established by the Law of Ukraine on the State Budget for a certain year, which resulted in a change in the amount of financial support for military personnel (official salary), is the basis for termination of the monthly supplement in the amount of UAH 2,000.00 provided for by CMU Resolution No. 713 and indexation in the amount provided for by CMU Resolutions No. 118 and No. 168.

The Grand Chamber of the Supreme Court agreed with these conclusions and upheld the decision of the SC AdmCC and dismissed the appeal.

Judgment of the SC AdmCC of 16 December 2024 in case No. 400/6254/24 (proceedings No. Пз/990/11/24) - https://reyestr.court.gov.ua/Review/123793985.

Resolution of the Grand Chamber of the Supreme Court of 13 March 2025 in case No. 400/6254/24 (proceedings No. Пз/990/11/24) - https://reyestr.court.gov.ua/Review/126486062.

This and other legal opinions of the Supreme Court are available in the Database of Legal Positions of the Supreme Court - https://lpd.court.gov.ua.