Dramatic situation. This hasn't happened for 35 years

• The Society of Polish Economists warns that the condition of public finances in Poland is becoming increasingly worrying.
• Experts point to the lack of decisive actions that could protect the country from exceeding the constitutional debt limit.
• In the Council's view, continuing failure to respond risks a serious breach of the basic principles of responsible fiscal policy.

The Council of the Association of Polish Economists points out that the data for 2024 and forecasts for 2025 indicate a serious deterioration in the fiscal situation of the state . "The deficit of the general government sector reached 6.6% of GDP in 2024, which places Poland in penultimate place in the European Union (ahead of Romania). The government forecast for 2025 assumes a further high deficit: 6.3% of GDP, and after taking into account advances on military equipment - as much as 7.8% of GDP. This is the highest deficit in the history of the Third Polish Republic (for over 35 years - editor's note)" - we read.

At the same time - the Council emphasises - public debt in relation to GDP increased by 5.8 percentage points, reaching 55.3% of GDP. The government's debt management strategy predicts that in 2026 it will de facto, although not de jure, exceed the limit of 60% of GDP written in the constitution.

Something is wrong with Poland's finances. A dramatic situation

As we read, government scenarios show that if the imbalance in public finances remains at its current level, the debt will snowball and grow to 100% of GDP in less than a decade and a half.

From a country with a moderate level of debt, we will become one of the most indebted countries in the EU - warns the Council of the Association of Polish Economists.

The Council of the Association of Polish Economists appeals to treat the repair of public finances as a fundamental priority in the state’s economic policy:

• as a society we must make the necessary compromises on priority spending from the state budget;
• we also have the right to know whether the government and the future President of the Republic of Poland plan to pursue a policy that will result in the debt level reaching 100 percent of GDP, or whether they want to follow the path of consolidation;
• if through a consolidation path, what spending will be reduced and/or what taxes will be increased.

According to the Council, it is necessary for the government to immediately present a reliable, updated and medium-term fiscal consolidation plan that takes into account both the need to limit expenditure and strengthen the revenue side of the budget. "Only in this way will it be possible to restore confidence in the state's fiscal policy and ensure long-term macroeconomic stability of Poland. Without secure public finances, we will not ensure the security of the state," we read.