Explainer: Polish pride in reduced social exclusion

Photo: Getty Images/Yui Mok - PA Images

Joanna Kopcińska, the Polish government’s press spokesperson has welcomed Eurostat and Oxfam findings on Poland’s efforts to combat social exclusion.

“This is practical proof of the effectiveness of our social policies and economic development policies ... Poland has at last begun to combat social exclusion” Ms Kopcińska said, praising the direction given to the government by Prime Minister Mateusz Morawiecki.

Putting the constitution into practice

The press spokesperson emphasized that the principle objective of the Law and Justice (PiS) government was the practical application of the principle of a social market economy enshrined in Poland’s constitution.

“We are having real success in realizing our objective and this is confirmed by independent international organizations in their analysis. The first was a report by Oxfam which ranked Poland as coming first in terms of devoting financial resources to combat social inequalities. Then we have the Eurostat data which shows Poland achieving a historic fall in children’s poverty from 24 percent to 18 percent.”

Oxfam indicators

Oxfam, the global humanitarian charity combating hunger, published its ranking of countries fighting inequality based on the “Commitment to Reducing Inequality Index”. The index is based on indicators covering 157 countries which measures government actions concerning social expenditure, taxation and labour rights.

According to the Oxfam ranking Poland came first in terms of social spending, however it came a distant 114th in terms of taxation. In respect of labour rights the country came 33rd. Its overall rating considering all indicator was 20th.

Eurostat findings

According to Eurostat the number of children affected by poverty has fallen from 24 percent to 17.9 percent in a single year. This represents a fall by six per cent, the highest achieved by Poland in Eurostat records.

Poland’s Office of Statistics (GUS) reports that in 2017 the number of people living in poverty fell from 4.9 to 4.3 percent. GUS attributed the fall to the rise in incomes, the fall in unemployment and the social transfers made via the universal child benefit 500+ programme (500 PLN per month for every second and further child).

Welcome boost before polling day

The findings of the two independent international bodies are particularly welcome for the Polish government as they come just a matter of days before all-out local government elections due on 21 October and the coming European and Polish Parliamentary elections in 2019.

They emphasize that the government has been able to deliver on its election promises and that the policies are having a real social impact for individuals and their families. This has not happened at the cost of economic growth. Poland’s GDP is rising at a steady annual rate of five per cent, incomes are rising by an average of just over 7 percent and the annual budget deficit in proportion to GDP is falling year.

Tax yields have been rising, especially those from VAT and corporate income tax. The rise in revenues has meant that the the social spending could be funded without excessive borrowing or rises in tax rates.

The feel-good factor has undoubtedly helped to keep the poll ratings of the current ruling party. These have been consistently high since coming into office. It is averaging more than 40 percent among decided voters, well ahead of its main opposition rival.

Risk factors

There are risk factors for the continuation of these positive trends which the Polish government will be keenly aware of. The first is any economic slow-down in the Eurozone. Poland is a major exporter of goods and would be affected by falling orders. That slow-down could translate into a stall in the rise of incomes resulting in a sluggish domestic market.

If, as a result, revenues for the state budget start falling and the future EU budget sees a major drop in funding compared with the current financing period, the country could find itself having to limit or even reduce its social spending commitments. Any reduction in entitlements is always political dynamite for any government.

Shoo-in for the election season?

However, these are all medium or long-term risks, unlikely to kick in before the current election marathon is completed in 2020 with the Presidential elections. But governments in Poland have lost power more often as a result of scandals and splits than economic or social policy factors.

Economic success is no guarantee of electoral success because attitudes towards the economy and one’s position on the income scale are not key indicators in determining electoral behaviour in Poland. Poland’s past history (especially that of the communist period), attitudes towards the Catholic church and moral or axiomatic issues seem to be more important in determining the way voters behave.