Polish PM Szydlo says government will likely decide on retirement age cuts next week

PM Beata Szydlo said Wed. that the government will likely decide on how to cut the retirement age at the cabinet setting set for next week. The government was supposed to make its decision this week, with the cabinet sitting having been moved from the usual Tues. to Wed. The Standing Committee of the Council of Ministers, which prepares legislation for the cabinet, recently backed a straight cut of the retirement age to 60 for women and 65 for men from the 67 toward which it is being raised. The Finance Ministry, however, wants a minimum contribution period of 35 years for women and 40 years for men.

Szydlo said the government would look first at the 60/65 version, which is the version submitted by President Andrzej Duda many months ago. She said she wanted the related legislation passed by year-end.

Overall, the retirement decision is an important test regarding the government’s commitment to fiscal rectitude. If it goes for the straight cut to 60/65, this means that political necessities are placed above budget realities. If it adds the minimum work period, then it is at least shows the realisation that it can’t deliver on all its promises and still keep the deficit in check. The best would be if the government simply dropped the increase entirely, particularly as it completely contradicts the moves being taken by Deputy PM Mateusz Morawiecki to reform the pension system. The decision will also be a test for the influence of Finance Minister Pawel Szalamacha.

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