The Parliamentary Committee on Public Finances has approved a draft amendment to the 2024 budget law, introducing changes that focus on reallocating funds to local governments in the current year. The proposed act concerns an additional transfer of PLN 10 billion to local authorities in 2024.
The KFP also considered the draft amendment to the Special Solutions Act, which is intended to implement the Budget Act of 2024, commonly referred to as the budget-related act.
The bill centers largely on channeling another PLN 10 billion toward local government units. Of this amount, PLN 8.2 billion would come from PIT revenues originally destined for the national budget, while roughly PLN 1.2 billion would result from increasing the general subsidy. The measure also governs how the extra funds will be distributed among individual local government entities.
During the committee’s deliberations, organizational and legislative changes were introduced and adopted. The bill is slated for a second reading at the Sejm plenary session.
Debate
Earlier, a debate occurred at the first reading of the draft amendment to the 2024 budget and the accompanying changes to the budget law for the year. The PiS and Confederation caucuses filed motions to reject both projects at the initial reading, meaning the Sejm will decide their fate through a vote.
Real Reasons
MP Zbigniew Kuźmiuk (PiS) argued that the true motivations for adjusting this year’s budget differ from those presented by the Ministry of Finance.
“The real causes of the drop in budget revenues this year are completely different from what is shown… It is the return to old practices that is driving the revenue collapse”, he asserted.
He recalled that from 2008–2015, when the PO-PSL coalition led the government, budget revenues grew by only PLN 35 billion, despite a cumulative 21 percent inflation. In contrast, the 2015–2023 period, under the PiS government and amid external shocks from the Covid-19 pandemic and the war in Ukraine, saw revenues double, with about 44 percent inflation over those years.
According to Kuźmiuk, the reasons listed by KO for the amendment include the absence of profit payments by the National Bank of Poland, inflation easing, or the PLN 10 billion transfer to local governments being a “classic smokescreen.” The underlying issue, he stressed, is the “collapse of tax revenues.”
“You are not monitoring these revenues… It is evident to anyone paying attention that policy has returned to a posture of tax privatization. That is unacceptable,” he noted.
The Government Responds
Janusz Cichoń (KO), head of the Parliamentary Finance Committee, reminded that the year’s budget was shaped under the umbrella of assumptions from the previous administration. He suggested this was partly a safeguard against letting Mateusz Morawiecki’s government take power after the October elections.
“We have not been able to present a complete overview of income and expenditure,” he said.
Cichoń argued that amendments to the 2024 budget are necessary because of corruption and misrepresentation observed during the PiS government. He added that the president of the NBP had stated in a letter that the bank would contribute PLN 8 billion to the budget from profits, but the bank sustained a financial loss and no such payment was made.
One reason for the amendment, he noted, is lower revenues from CO2 emission allowance sales. He accused PiS of diverting PLN 100 billion of revenue as prices remained higher than anticipated.
“We welcome the inflation decline because we do not want budget revenues built on families’ burdens, and you have succeeded,” Cichoń added.
He also highlighted that the amendment includes a further PLN 10 billion transfer to local governments to preserve their liquidity, explaining that tensions in their finances stem from tax reforms during the prior government period, referred to as the Polish Order.
Cichoń emphasized that the amendment does not alter the year’s spending limit, which remains just over PLN 866 billion, but introduces changes. He argued that the final budget deficit could end up lower than the projected PLN 240 billion.
“This is a straightforward approach to organizing the budget and public finances, free from the tricks and creative accounting seen in the previous term,” he concluded.
Other Political Groups
Support for the draft amendment came from Polska 2050 – Trzecia Droga, PSL – Trzecia Droga, and the Left. MP Sławomir Ćwik (Poland 2050 – TD) suggested that the main factor affecting 2024 budget revenues is the projected inflation shift, noting that PiS had expected 6.6 percent on average, versus a much higher rate in 2023.
MP Agnieszka Maria Kłopotek (PSL – TD) recalled the impact of tax changes during the PiS era on local governments.
She stated that the proposed measures lay the groundwork for transferring more than PLN 10 billion to local authorities this year.
Tomasz Trela (Left) argued that the larger deficit in the bill reflects the need to clean up the financial missteps from eight years of administration.
What the Confederation Says
MP Sławomir Mentzen (Confederation), who supported opposing the amendment, warned that the planned deficit would be almost a third higher than forecast and state revenues would fall by PLN 56 billion. He urged that the economy be steered toward real reforms that support entrepreneurs and overall economic growth.
“Entrepreneurs drive GDP. It is time to settle Polish affairs. A serious state is overdue”, Mentzen urged.
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(citation: wPolityce)