This article is written about a particular kind of dependent’s benefits, the orphan’s benefits. This legal institution is very special, therefore it is regulated by more laws and decrees.
The article consists of two parts: the first parts contains the basic notions and the features of the orphan’s benefits. The second parts discuss the enforcement of claims of the orphan’s benefits and its procedural regulations.
Some current judicial practices were listed at the end of both parts of the article in connection with this topic.
The concepts of dependent benefits.
The dependent benefits shall mean regular payments of money calculated upon the income of the insured person (formerly insured person), or his relative, consistent with his service time.
The dependent’s benefits are provided to the insured person under the frame of the social security pension system.
The service time.
The concept of the service time is determined by the Act LXXXI of 1997 on Social Security Pension Benefits (hereinafter: Social Security Pension Benefits Act or SSPA) Sec. 4 (1) point h).
According to the SSPA Sec 4 (1) point h) service time shall mean the periods when the insured person was required to pay pension contributions, or paid pension contributions under a voluntary arrangement. The periods of service time free from any obligation of payment of pension contributions shall be laid down in specific other legislation.
The family member required and capable to provide maintenance.
According to the SSPA Sec 4 (1) point i) the family member required and capable to provide maintenance shall mean a person legally required to provide maintenance to an orphan’s pension creditor and/or a parent’s benefit creditor – consistent with the chain of maintenance obligation – before the deceased rightholder
ia) who was ordered by court to provide maintenance to the orphan’s pension creditor and/or the parent’s benefit creditor as due, or
ib) whose per capita income in the family exceeds two and a half times the mandatory minimum amount of full old-age pension benefits according to Act III of 1993 on Social Administration and Social Welfare Benefits, except if not required – by decision of the court – to provide maintenance to the orphan’s pension creditor and/or parent’s benefit creditor, with the proviso that a person whose whereabouts is unknown shall be considered incapable to provide maintenance;
The concepts of orphan’s pension.
Pursuant to the SSPA Sec. 4 (1) point f) orphan’s pension shall mean the benefits paid to the children or adopted children of a deceased pensioner or of a person with pension rights who does not receive pension, or to their foster children, brothers and sisters or grandchildren subject to specific conditions.
The SPA Sec. 6 (2) list kinds of dependent’s benefits which are provided under the frame of the social security pension system. These are the follows:
a) widow’s pension;
b) orphan’s pension;
c) parent’s benefits;
d) accident-related dependent’s benefits;
e) widow’s benefits.
The requirements of entitlement.
The requirements of entitlement of the dependent’s benefits are regulated by the SSPA Sec. 46, Sec. 54 (1)-(3) and Sec. 55 (1)-(5).
Regarding to the entitlement, the SSPA Sec. 54 (1) refers to the contents of the SSPA Sec. 46. Pursuant to this provision, orphan’s pension shall be available to any children – born in wedlock or in a domestic partnership and raised together in the same household -, whose parent satisfies the requirements set out in Section 46 applicable to the deceased spouse.
The SSPA Sec. 46 ascertains the following:
(1) Widow’s pension shall be available to a person whose spouse died while drawing old-age pension or whose spouse died:
a) before reaching 22 years of age and
aa) who obtained service time within 180 days upon the conclusion of his/her studies, or
ab) a total of at least 2 years of service time;
b) after reaching 22 and before reaching 25 years of age, and acquired at least 4 years of service time;
c) after reaching 25 and before reaching 30 years of age, and acquired at least 6 years of service time;
d) after reaching 30 and before reaching 35 years of age, and acquired at least 8 years of service time;
e) after reaching 35 and before reaching 45 years of age, and acquired at least 10 years of service time;
f) after reaching 45 years of age, and acquired at least 15 years of service time.
(2) Furthermore, any person whose spouse did not acquire the service time prescribed in Subsection (1) shall be entitled to widow’s pension if his/her spouse acquired to service time prescribed for the lower age group and if his/her service time is not interrupted subsequently for any period of thirty days of more until the time of his/her death. This thirty-day period shall not include any period of incapacity to work.
According to the SSPA Sec. 46 (3) the following periods shall be acknowledged as service time for the purpose of eligibility for widow’s pension: the period during which the deceased rightholder had been drawing invalidity benefits, accident-related disability benefits or invalidity allowance.
Pursuant to the SSPA Sec. 54 (2), orphan’s pension shall not be available to an adopted child by way of his/her biological parent, except if the child was adopted by the spouse of his/her biological parent. The Subsection 3 states that, orphan’s pension shall be available to a brother or sister, or a grandchild (including great-grandchildren and great-great-grandchildren) if he/she was supported by the deceased person in his own home, and if the child does not have any relative who is able and willing to support him/her.
By the way it is good to know that the Payment of orphan’s pension to the children referred to in Subsection (3) of Section 54 of the SSPA shall be suspended – from the first day of the month following the date of delivery of the relevant resolution of the first instance – if the relative liable to provide support becomes able to support them. [Government Decree 168/1997 (X.6.) Korm. on implementation of Act LXXXI of 1997 on Social Security Pension Benefits Sec. 64 (1)]
The period (availability) of orphan’s benefits.
The period (availability) is determined by the SSPA Sec. 55 (1)-(5).
Orphan’s pension shall be available – if the conditions for entitlement are satisfied – as of the day of the death of the deceased person until the child’s sixteenth birthday.
If the child is pursuing a full-time course of study or participates in full-time education and training in a higher education institution, orphan’s pension shall be provided for the duration of studies, up to the child’s twenty-fifth birthday. If the child’s ability to work has diminished within the period of entitlement, orphan’s pension shall be provided for these periods independent of age.
It is very important if the orphan is older than twenty-five years old at the death of the person referred to in Section 54, the orphan’s benefit can not be granted for him/her. The earlier granted benefit – depending on the full-time course of study – will ceased. There is a an exception when the orphan is supported in orphan’s pension and he/she was a person with reduced ability to work at the time when he/she 25 years old.
In this case the orphan will be supported with the orphan’s benefit until he/she is qualified as a person with reduced ability to work. It is very important to know that if the orphan’s benefit is terminated due to health improvement, it can not be determined above the age of 25 again even though if the orphans health begins to deteriorate later.
The Head Office (the central body of the Hungarian State Treasury; hereinafter: Treasury) can ascertain special benefit in exceptional case, equity if the orphan at the death of deceased rightholder, is older than the age of 25 and he/she is pursuing a full-time course of study or participates in full-time education and training. The Head Office also extend the right to special orphan’s benefits in its power of equity regarding to the former death of deceased rightholder and the studies of the child, if the entitlement of him/her was existed before the age of 25 of the orphan.
If the child’s ability to work has diminished within the period of entitlement, orphan’s pension shall be provided for these period independent of age.
The child or his/her parent’s marriage shall have no bearing on entitlement to orphan’s pension, nor if the child is adopted.
On the grounds of schooling entitlement to orphan’s pension shall be granted to a child who:
- pursues studies as a student with individual study arrangement due to an illness or physical or mental handicap, pregnancy, childbirth or to caring for his or her child under 3 years of age;
- is below the age of 25 and pursues studies within the framework of adult education, provided that such adult education is provided by means other than distance education, and the weekly number of classes reaches seven in the average.
It is very important to note that on the grounds of schooling, orphan’s pension shall be granted until the end of the last month of studies, including the period of summer school-break as well. The legislator intends to use this rules to help the parent and the child in need of care in the same household making the coverage of child-raising costs easier during the child studies.
The SSPA also includes those rules which are in connection with the orphan studies. This rules describes the verification process of the entitlement of orphan’s benefits in connection with the orphans studies.
In connection with orphans studying in Hungary, the body operating the public education information system or the higher education information system shall verify the commencement and existence of the student relationship and the estimated time for the conclusion of studies at the request of the pension insurance administration agency, and shall ex officio verify the suspension or termination of student relationship, indicating the student’s name and social security identification code and the length of the time of suspension or termination. So, in this case, the claimant (applicant) has no individual action.
In the case of orphans studying abroad, school attendance shall be verified once a year if attending a secondary school and semi-annually if attending an institution of higher learning within one month from the date of commencement of studies.
Where the studies of a student of a secondary school or institution of higher education are suspended due to the student’s illness or giving birth to a child, this shall have no bearing on entitlement to orphan’s pension.
The amount of benefits.
The amount of the orphan’s benefits are determined by the SSPA Sec. 56 (1)-(4).
Orphan’s pension shall be thirty per cent per child of the old-age pension benefits to which the deceased person had been or should have been entitled at the time of his/her death. The Government Decree 168/1997 (X.6.) Korm. on implementation of Act LXXXI of 1997 on Social Security Pension Benefits Sec. 64/D states the following: the mandatory minimum amount of orphan’s pension assessed for periods between 31 December 2007 and 1 January 2020 shall be 24,250 forints per month.
Pursuant to the SSPA Sec. 59 if there are several orphan’s, they each receive the amount due under the law. In contrary with the widow’s pension, the orphan’s benefit will not be shared. [SSPA Sec. 51, 59]
Summarize the above-mentioned facts, the mandatory minimum amount of orphan’s pension shall be thirty per cent per child of the old-age pension benefits but at least the aforementioned 24,250 forints per month.
Sixty per cent of the pension and benefits referred to in Subsection (1) shall be paid as orphan’s pension to a child:
a) if both parents have died,
b) whose parent’s ability to work has diminished.
If a child is entitled to orphan’s pension in connection with both parents, the orphan’s pension that is more favorable shall be paid.
Person with reduced ability to work.
Pursuant to the SSPA Sec. 4 (1) point k) person with reduced ability to work shall mean a person whose health had deteriorated by up to 50 per cent. The rules of person with reduced ability to work are determined by the Act on the Benefits Provided to Workers with Disabilities and on the Amendment of Certain Acts (Act CXCI of 2011).
The current jurisdiction.
Judicial Decision No. 17/2000. (V.26.) It is not unconstitutional that the entitlement of the orphan’s benefit is bound to the service time. On the one hand the State is not obligated to provide solution of social security for every single life situation. The Social Security Pension System is only one of the type of the subsistence benefits. On the other hand the orphan’s benefit is ground on the entitlement to old-age pension of the deceased rightholder, it depends on, therefore the orphan’s of those who acquired the necessary service time and those without it, can not be taken account to be a homogeneous group. So, it can not to be talked about discrimination too.
Decision No. 867/B/1997. (Constitutional Court) It is not unconstitutional that the orphan’s benefit – if the orphan is not a person with reduced ability to work – will terminated at the age of 25 because the provisions of child protection constitutional proclamation does not create individual entitlement.
Judicial Decision No. 2004. 1065. There is no orphan’s benefit for person with reduced ability to work, if he/she is older than the age of 25 at the time of death of the rightholder.
Metropolitan Administrative and Labor Court Decision M.3325/2006/10. It is not chargeable taking the orphan’s benefit for the orphan, if he/she can verify that he/she made the notification and even so the Nyufig (Pension Payment Directorate) has not terminated the transfer.
Commentary on Act LXXXI of 1997 on Social Security Pension Benefits, Edited by Áron Pánczél. Budapest, Wolters Kluwer (Nagykommentár a társadalombiztosítási nyugellátásról szóló 1997. évi LXXXI. törvényhez – Szerkesztette: Pánczél Áron. Budapest, Wolters Kluwer – Jogtár)
Act LXXXI of 1997 on Social Security Pension Benefits
Act LXXX of 1997 on the Eligibility for Social Security Benefits and Private Pensions and the Funding of These Services
Act CL of 2016 on General Public Administration Procedures
Government Decree 168/1997 (X.6.) Korm. on implementation of Act LXXXI of 1997 on Social Security Pension Benefits