President Bronislaw Komorowski will meet later this week with economists critical of the plan officially adopted by the government yesterday to cut private pension plan contributions as part of its drive to slash public debt.

The director at the President’s press office refused to say however who would be at the consultation session on Friday, except that “we expect the presence of distinguished experts on economics, social police and those from the business community.” she told Polish Radio.

After a meeting of the cabinet on Monday, Prime Minister Donald Tusk announced that the government will put a plan before parliament to cut  the pension transfer rate to private funds from the current 7.3 percent to 2.3 percent.

PM Tusk said he wants the measure to come into force by 1 May.

Poles currently put pension contributions into both the state insurance company ZUS and a private pension fund of their choice, after reforms to the pension system came into force in the late 1990s.

The funds paid into the state system are used for those already on pension. The contributions put into private funds are to be used by workers who retire in the future.

Tusk said he hopes to gradually increase the amount put into private funds to 3.5 percent by 2017.

The plan is deigned to cut borrowing needs by 12 billion zloty (3 billion euros) this year and 190 billion zloty by 2020, the prime minister said. The budget deficit will be cut from 6 percent of GDP this year from 7.9 percent.

Critics

The timetable for the draft legislation has come under fire from economists, who say that disputes between the government and economists have already delayed the passing of the bill by one month already.

Lawyers have commented that the implementation of the plan could take place as late as the second half of this year, cutting the savings envisaged in 2010 significantly.

Lech Pilecki from the Polish Confederation of Private Entrepreneurs however has criticised the plan to cut private pension contributions.

“It is very disturbing that on the one hand there is no guarantee of higher pensions [in the future] and on the other hand, no significant reform of public finances will be undertaken by the government,” he told Polish Radio. (pg)