Polish PM survives crisis over budget

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THE POLISH parliament yesterday passed a tight state budget, narrowly averting a government crisis and clearing the way to a new agreement with the International Monetary Fund.

The Prime Minister, Hanna Suchocka, had told the Sejm (lower house of parliament) that her government would resign if the legislature rejected a budget for 1993 that includes tight restrictions on social spending. Leaders of Solidarity, the movement that propelled Poland's peaceful democratic revolution in 1989, ordered their members of parliament to reject the budget.

President Lech Walesa had said that he would dissolve parliament and call fresh elections if the budget was thrown out. 'My mind is made up. We have no time for destruction. I would like this parliament to continue as there is still a lot to do, but we cannot play games for too long. The public wants swift and concrete actions,' he said.

Mrs Suchocka's government took office last July and, despite being a seven-party coalition without a parliamentary majority, appeared to be one of Poland's more stable administrations of the past three years. But there have been frequent outbreaks of labour unrest related to high inflation, fears of unemployment and a fall in some real industrial wages. Workforces at a number of big factories, such as the Stalowa Wola steelworks, have been hit by the failure of enterprises in the former Soviet Union to pay for imported Polish goods on time.

Poland's apparent political instability is partly a reflection of a complex system of proportional representation which, in the elections of October 1991, resulted in 29 parties winning seats in parliament. Since then, some parties have broken up into squabbling factions, and others have failed to maintain discipline over their representatives in the legislature.

However, some Western specialists believe that the collapse of one government after another since 1990 does not mean that Poland's development as a free-market democracy is under serious threat. Fierce debates have raged on issues such as the separation of Church and State, abortion and the removal of former Communists from positions of influence, but extremist political groups have only thin support and, in contrast to its neighbours, Poland has few serious ethnic tensions.

Economists add that Poland has shown encouraging signs of recovery from the recession that was induced by the 'shock therapy' reforms of the first post-Communist government of Tadeusz Mazowiecki. Inflation is being gradually brought under control, the fall in industrial output has been arrested, and Poland has made good progress in finding markets for its products in the West.

The biggest single problem has, in fact, turned out to be the government's budget deficit. Mrs Suchocka said that Poland needed to hold the deficit at 81,000bn zloties ( pounds 3.5bn), or about 5 per cent of Gross National Product. This limit was negotiated with the IMF as a condition for a dollars 700m ( pounds 500m) loan that will pave the way to debt-rescheduling agreements with Poland's creditors.

(Photograph omitted)