Polish ruling party pledges to introduce earlier pensions if it wins another term

Sep 14, 2023 | Business, Politics, Society

Poland’s ruling party has pledged that, if it wins a third term in office at next month’s elections, it will introduce the possibility of earlier retirement for those who have worked a certain number of years – an idea its leader rejected as unaffordable less than a year ago.

The national-conservative Law and Justice (PiS), which already lowered the retirement age to 60 for women and 65 for men in 2017, now wants to allow women to retire after 38 years of work and men after 43 years.

That would mean that a woman who worked from the age of 18 could retire at 56, and a man at 61 – in both cases four years earlier than the current retirement age.

“Donald Tusk ordered Poles to work until they are 67,” tweeted PiS today, referring to the current leader of the opposition, who raised the retirement age when previously serving as prime minister. “PiS has lowered the retirement age and now offers seniority pensions for hard-working Poles!”

“There are people who from their youngest years worked hard, very often physically,” said Prime Minister Mateusz Morawiecki in an accompanying video. “It is they who get up every morning, often before dawn, and build our homeland.”

“[As] an expression of our gratitude for your hard work…we want to introduce seniority pensions, an idea coming from the times of Solidarity,” he continued.

In 1980, among the 21 demands of workers striking in the Gdańsk shipyard was the possibility of retirement after a certain number of years working. Those demands led later that year to the creation of the Solidarity trade union that eventually helped bring down Poland’s communist regime.

During the current parliamentary term, two proposals have already been put to parliament to introduce seniority pensions, one by President Andrzej Duda, a PiS ally, and another by the Solidarity trade union.

However, in December last year, PiS chairman Jarosław Kaczyński rejected the idea, saying that it was not affordable.

“We have a very large number of retirees in relation to our population and we must also take this into account,” said Kaczyński, quoted by financial news service Money.pl. “Those who advocate receiving pensions [earlier] must remember that those pensions will be much lower.”

“The government cannot produce money [to pay for it] because that would mean hyperinflation,” he added.

The head of the Social Insurance Institution (ZUS), which oversees Poland’s state pension system, likewise warned that introducing seniority pensions would have “serious negative consequences for both the insured and the system”.

ZUS estimated it would reduce contributions by 50 billion zloty (€10.8 billion) over a decade and increase expenses by 80 billion zloty.

But PiS’s position has now changed, with Kaczyński declaring his support for seniority pensions last weekend and social policy minister Marlena Maląg telling Radio Zet this week that the policy is “a very well-thought-out decision…at a time when the budget can afford such a change”.

She also denied that anyone taking such early retirement would receive a pension lower than the statutory minimum.

However, the idea runs contrary to the recommendations of many economists. Some argue that, given Poland’s ageing population, the retirement age should in fact be raised.

In a report earlier this year, the Organisation for Economic Co-operation and Development (OECD), of which Poland is a member, recommended that the country raise its retirement age and make it equal for men and women.

Małgorzata Starczewska-Krzysztoszek, an economist at the University of Warsaw, told broadcaster RMF that PiS’s plans for a seniority pension would “lead to a very difficult situation” both for the economy, due to a smaller labour force, and public finances, due to lower pension contributions and higher payouts.

Although Tusk previously raised the retirement age as prime minister, earlier this year he pledged that his Civic Platform (PO) party would not do so if it comes to power after next month’s elections.

But PiS has argued that Tusk’s promises cannot be trusted, and has therefore called a referendum that will take place at the same time as elections and includes a question asking Poles if they support raising the retirement age back to 67.


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