The draft of the second pension indexation has passed through all stages of consultations, but at the last government meeting it was not adopted“The Council of Ministers will return to the project procedure if there is a risk of exceeding 5 percent inflation. For now Ministry of Finance However, it does not foresee such an increase. The mechanism for additional indexation has been developed, and further processing of the bill may be undertaken at any time, if necessary,” it informed Government Information Centre (RCL).
The second pension indexation goes into the drawer. Here's why
This is the official version presented by RCL. Money.pl However, he also writes about the unofficial reasons for the decision, which means that the project of the second pension indexation ends up in the drawer. “The adoption of the act could be perceived as an announcement that inflation will be high – boost inflation expectations” – we read. This could strengthen the expectations of Poles that the additional valorization will actually be carried out next year. – In the current economic situation, its introduction could cause unnecessary confusion – says the interlocutor from government.
The portal emphasizes that there may be another factor at play: at the end of 2024, year-on-year inflation will be well above 5 percent. This level is expected to continue in the first quarter of 2025, and then it is expected to start falling. “The government could have feared that announcements from the beginning of the year about year-on-year inflation above 5 percent would cause some pensioners to wait for the payment of a higher pension after the second indexation,” we read. However, this will not happen because the statutory criteria will not be met. This may then result in disappointment and complaints from pensioners.
Indexation of pensions and annuities in Poland
Let us recall that currently pension indexation is carried out once a year – on March 1. According to the frozen project, if inflation in the first half of the year exceeds 5 percent, indexation would take place twice a year: in March and in September. The increase in the minimum wage works on the same principle. If inflation exceeds 5 percent, the government is obliged to raise salaries basic in January and July.
The September indexation would not be an increase, but an advance payment. This means that the March indexation the following year would be correspondingly lower. The bill was prepared by the Ministry of Family, Labor and Social Policy headed by Agnieszka Dziemianowicz-Bąk from the Left. The idea of additional indexation was pushed by the opposition parties during the election campaign. It even found its way into the “100 specifics” of the Civic Coalition and the Left's program. It was supposed to provide assistance in connection with high inflation.