Poland delays lowering of retirement age to 2017

By bne IntelliNews February 26, 2016

The Polish government will not lower the country's retirement age until 2017, Prime Minister Beata Szydlo said on February 26.

Szydlo’s Law and Justice party (PiS) won the election in October with flagship policy pledges to increase social spending and unravel the previous government’s pension reforms this year. While the main promise of increased child benefit is being implemented already, the delay to the retirement measures suggests the government is struggling to make the budget numbers work.

PiS promised to scrap the only meaningful reform of the Civic Platform government's 8 years in power. The business-friendly party increased the age of retirement to 67 in 2012, despite protests. PiS said it will return to the old system in which men retire at 65 and women at 60.

Critics have panned the idea, noting huge costs and negative effects on the pensions system and labour market. PiS had estimated the cost of the reform at PLN2.7bn for 2016, but according to Szydlo it now needs to be delayed until 2017, although she failed to specify the reasons for the postponement.

The programme of child benefit, which will kick in from April, is estimated to cost PLN17bn in 2016 and PLN20bn next year. To cover the cost, the government has introduced a bank tax and is working on a tax on retail turnover. However, analysts still suggest concern over the budget.


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