Karol Nawrocki, now president-elect, announced in his election run "fair valorisation of pensions", promising to increase the lowest benefits by at least 150 PLN. This proposal, although highly attractive to millions of seniors, immediately met with a informing from the president of the Social Insurance Institution, Zbigniew Derdziuk. According to the head of ZUS, the addition of fresh funds to the pension system, without being covered in contributions, inevitably leads to an increase in government debt. Faced with the increasing deficit of the Social Insurance Fund, the possible of additional budget expenditure becomes a key subject of discussion about the future of Polish public finances and the stableness of the pension strategy in 2025. Can electoral promises be reconciled with economical reality?
What does ‘fair valorisation’ mean for pensioners?
The proposal of president Elekt Karol Nawrocki assumes that the lowest pension benefits would increase by at least PLN 150. This is simply a crucial amount, given that the last valorisation in March 2024, amounting to 5.5%, translated into an increase in the minimum pension by PLN 97. For many seniors, especially those collecting the lowest benefits, an additional PLN 150 per period would supply real support in the face of rising cost of living. The aim of this initiative is to guarantee that elder citizens with the lowest incomes are not left to themselves and that their benefits increase at a pace appropriate to inflation and the general increase in the wealth of society. In the past, as the president of ZUS recalls, various forms of support have been introduced, including the amount weighting or the "thirteenth pension" which besides aimed at improving the financial situation of the least prosperous pensioners.
ZUS warns: Deficit and rising sovereign debt
ZUS president Zbigniew Derdziuk openly expresses concerns about the financing of the promised increases. It emphasises that although the addition of fresh funds is attractive to beneficiaries, this requires a coverage from the State budget, which consequently leads to an increase in debt. The Social Insurance Fund (FUS) has been facing a deficit for years, which means that the current contributions do not cover the full benefits paid. This difference is systematically complemented by the state budget, i.e. the taxes of all citizens. The introduction of additional, rigid increases, specified as the proposed PLN 150, without expanding the gross from contributions, would deepen this gap. Derdziuk demarcates the social safety system, based on contributions, from the social assistance system, financed from the budget, indicating the request to keep the clarity of these mechanisms.
How does the current strategy of valorisation of benefits work?
The current mechanics for valorisation of pension benefits in Poland is strictly defined by the Law on Pensions and Pensions from FUS. This process takes place annually 1 March and based on 2 key indicators. The first is the average yearly index of consumer goods and services for households of pensioners, which in 2024 amounted to 103.6%. The second is the real increase in average wage in the erstwhile year, which achieved 9.5 percent The combination of these indicators is intended to guarantee that benefits grow adequately to inflation and the overall standard of living. As a consequence of the valorisation of 1 March 2025, the lowest pension, the pension for full incapacity for work, the household pension and the social pension are PLN 1878.91. The lowest partial incapacity pension is PLN 1409,18.
Voluntary ZUS for entrepreneurs: Is that a viable option?
Another subject addressed by the president of ZUS is the call for voluntary introduction of social safety contributions by entrepreneurs. This is 1 of the ideas, including the Confederacy, which has already submitted a suitable task in the Sejm. Currently, single-person entrepreneurs pay a flat-rate contribution of 60% of the average wage. Although they can pay more to safe a higher pension in the future, ZUS statistic are unambiguous: less than 1% of entrepreneurs decide to pay contributions above the minimum. president Derdziuk warns that in the event of the abolition of the work to pay contributions, many people would resign from them, becoming beneficiaries of social assistance in the future or expecting support from the state, which would impose a different burden on the budget.
The debate on the valorization of pensions and the proposals of the President-elect Karol Nawrocki highlights the key challenges facing the Polish public finance system. On the 1 hand, there is simply a strong request to improve the material situation of seniors, especially the poorest ones. On the another hand, ZUS president Zbigniew Derdziuk clearly points to the hazard of worsening the deficit of the FU and expanding public debt if these promises are not balanced by appropriate sources of funding. The future of the valorisation of pensions in 2025 will require hard political decisions that will find the stableness of the social safety strategy and the state budget.
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Promised pension increase 2025: ZUS alerts. Are we facing massive public debt?
