In Poland: New Retirement Age for Assured Prosperity
August 6, 2013
Poland’s decision to increase the national retirement age aims at creating a more sustainable system of pensions. The World Bank is supporting the decision, through a recent Development Policy Loan to the country.
“Pension reform is one of the most important reforms in Poland, implemented after 1989. It gives sustainability to the system of pensions,” says Michal Baj, a director in the country’s Ministry of Finance.
The new retirement age is 67, and guarantees a higher pension for increasingly healthier pensioners. “According to our calculations, every year longer spent at work can result with a ten percent increase in pension,” Baj says.
The new regulations will be applied gradually over about 30 years in the case of women, who prior to the reform used to retire at the age of 60. For men, the transition period will be shorter and take 7 years, as they were already working until 65.
One of the reasons you decide to work longer is that your pension will go up with every year of professional activity.
In addition to higher pensions in the long run, the increase in Poland’s retirement age will also lead to an increase in GDP, a longer tax payment period, and a lower deficit.
Reactions to the new regulations are mixed in the country, where about 24 million of Poland’s 38 million people are of working age.
31-year old bank employee, Anna Rybowska, says she’s not looking forward to working longer, but knows the new rules will ultimately benefit the country.
“A pension is a safety net for the future which is necessary in many cases, not everyone has children some people have no one to rely on and many people do not think about securing their future now, so they will certainly need support,” Anna says.
34-year-old Konrad Porski, a salesman at a communications firm and Anna’s husband, says he’s not opposed to the new retirement age, but he is also not sure he will feel the same way in another 33 years!
“I am in favor [of the reform]. I could work until 70. But then I think: Could I really work that long, and what jobs can one do at that age? Now I am young and strong and can answer 30 emails a day, but will I be able to that at in my late 60’s? I am not sure, both mentally and physically,” Konrad says.
The country’s lawmakers say they are looking into such questions as well as others, and that the government is planning to implement social programs that will address any negative impact that this new rise in retirement could have.
Such programs, along with the national statistics showing that people are living longer, healthier lives, will make for a more decent pension when the time for retirement finally does come, says Elżbieta Kobielska, an anesthesiologist and university lecturer.
“One of the reasons you decide to work longer is that your pension will go up with every year of professional activity,” she says, adding that a higher pension and- equally important - a love for her job, are the reasons she’s still happily working at 70!
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