(Bloomberg) -- Poland’s nationalist ruling party will seek to effectively reduce the retirement age, its latest election-campaign promise coming after a sharp selloff on local financial markets.
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Law & Justice Chairman Jaroslaw Kaczynski unveiled on Saturday plans to allow women to retire after working for 38 years and men after 41 years, reducing the age at which Poles can start to receive pension benefits by as much as four years.
The result of the Oct. 15 election remains uncertain, as opinion polls show the front-runner Law & Justice and the main opposition group, the Civic Platform, both short of an outright majority.
The ballot is set to determine whether the biggest eastern economy in the European Union, which is also on the frontier of the war in Ukraine, will continue to defy the EU’s democratic standards. A mix of Poland First rhetoric, generous welfare spending and rapid economic growth has kept Law & Justice in power for eight years.
“We’re building a strong Poland,” Kaczynski told a party convention in the central-Polish town of Konskie. “Some may not like us, but everyone knows that we’re an independent country.”
The campaign took a new twist earlier this week after the central bank blindsided investors with a steep interest-rate cut that sent the zloty to its deepest slide since the Ukraine invasion in early 2022. The decision sparked accusations that Governor Adam Glapinski was doing the government’s bidding.
The planned retirement age revamp would allow women to retire with state-pension benefits as early as when they are 56 years old, while men can tap pensions from 61. The current retirement age for women is 60 and 65 for men — already one of the lowest in the EU for a nation facing a demographic crisis.
Law & Justice didn’t detail the expected fiscal costs of the change, which are likely to rise over time. The government is already expecting a much wider budget deficit next year due to slow economic growth and rising military and social spending.
While Kaczynski’s ruling alliance leads in the polls, the part has come under fire for its failure to tackle the cost-of-living crisis after inflation spiked to a quarter-century high earlier this year.
Speaking separately on Saturday, Civic Platform leader Donald Tusk proposed to double the tax-free income bracket to 60,000 zloty ($13,906) and offered tax-relief for pensioners if the opposition wins power. He also pledged to deliver tens of billions of euros in EU aid frozen due to concerns over Law & Justice policies that the bloc said erode democratic standards.
Eight years ago, Law & Justice grabbed power by offering family benefits, which it pledged to increase by 60% earlier this year. In past days, Law & Justice has also been sprinkling voters with pledges of smaller social spending such as better meals in hospitals and paid school trips.
Addressing the convention, Prime Minister Mateusz Morawiecki said the government wants to boost productivity and raise wages to French levels over the next six years, but “without street riots and burning cars.” The Law & Justice has repeatedly railed against migrants and accused the opposition of working with the EU to undermine the government.
“We want a Poland that can say: our enemies tried to destroy us and they completely failed,” Kaczynski said. “That is our goal.”
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