Maciej Żukowski

The New Polish Pension Laws

In Poland, similar to other countries in Central and Eastern Europe, the transition from a centrally planned economy to a market economy with its economic and political problems caused a situation that made a pension system reform necessary.

The Impact of the Economic and Financial Crisis on the Polish Pension System

In 1999, Poland introduced a radical reform of its retirement pension system. That reform rested on replacing a portion of the pay-as-you-go scheme with a fully funded capital scheme, as well as on withdrawing from a defined-benefit pension formula in favour of equivalent solutions via the introduction of a defined-contribution pension formula. When, in 2008, the global financial crisis disrupted financial markets, the rate of returns on investments from pension funds dropped dramatically. Moreover, the difficult state of public finances started to encumber the further financing of the reform’s transitional period. This brought about a discussion on “reforming the reform” in Poland and led to a reduction of the contribution rate to the funded pillar from 7.3% to 2.3% beginning in May 2011. The recent debate has both touched on and highlighted a range of issues which had not been aired to date.