WARSAW (Thomson Financial) - Poland's ruling conservatives are determined to keep public finances in check even if they have to rule in a minority and possibly fight new elections later this year, Prime Minister Jaroslaw Kaczynski's chief political adviser said today.
Adam Lipinski told Thomson Financial News that the conservative cabinet would remain committed to its bill to streamline public finances and to maintaining the deficit at 30 bln zlotys next year, cutting it as a percentage of GDP.
"We will not agree to the destruction of public finances, however the situation develops," Lipinski said in a telephone interview.
"We will not depart from our commitment to public finance reform and the (30 bln) budget anchor will be maintained - this is fundamental."
Kaczynski said today that a decision on the future of the Polish government would be made in September, after he sacked Deputy Prime Minister Andrzej Lepper yesterday, sending the ruling coalition spiralling toward collapse.
If MPs from Lepper's populist Self-Defence party approve a departure from the coalition today, the government will have to face building a working majority in parliament before it submits its 2008 budget bill in September.
"After the dismissal of the Deputy Prime Minister and the likely departure from the government of SelfDefence, the scenario of early elections is very likely," Lipinski said.
"I would evaluate the likelihood of this scenario at more than 50 pct. We will try to build a majority, since a minority government cannot last. It is still difficult to say in what form this (majority) can be, but currently the most likely situation is early elections, which could take place, given the constitutional procedure, in the autumn or in the winter."
pawel.sobczak@thomson.com +48 22 447 2430
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