Reuters International

Skyline of Warsaw skyscrapers is pictured after sunset in Warsaw, Poland June 21, 2016. REUTERS/Kacper Pempel

(reuters_tickers)

By Justyna Pawlak and Tadeusz Kolasinski

WARSAW (Reuters) - Poland's conservative government is betting on a new child subsidy to prop up its ratings and boost confidence in the European Union's sixth largest economy.

Opinion polls suggest the 500+ subsidy, introduced in April and named after the monthly 500 zlotys (95.62 pounds) per child it offers, is proving popular for the governing Law and Justice (PiS) party as it battles accusations of undermining democracy.

But some women's groups and opponents say it reinforces an outdated, stereotypical image of women and helps the PiS divert attention from the charges that it has ridden roughshod over the rule of law by trying to shackle the constitutional court.

Monika Rybicka, a 25-year-old mother of two, is a beneficiary of the 500+ subsidy, an important part of the PiS' successful election campaign last year. But she also sees potential pitfalls.

"It's a good move by the state. They noticed us and helped us," said Rybicka, who lives with her baby twins in social housing in the small town of Wyszkow, about 60 km (37 miles) northeast of Warsaw.

She says the additional 1,000 zlotys she receives each month, in a country were the average wage is 4,250 zlotys per month, is a "huge help" and she can now afford better things.

But Rybicka, who was unemployed before she gave birth, acknowledges the subsidy is high enough to discourage some mothers, especially those who are poorly paid or out of work, from seeking a job or returning to their former workplace.

"If you have two children and you earn 1,500 zlotys (a month) then you can quit your job, take the subsidy and stay at home," she said.

"You can save money by staying at home. Day care is costly. So you can stay at home and maybe make some money under the table."

ROLE OF WOMEN

The child subsidy is meant to help 2.7 million families in the country of 38 million people which shook off communist rule in 1989 and joined the European Union in 2004.

Economists say it is expected to bolster the economy by fuelling consumption, at least in the short term.

It was followed this month by another important move to boost the economy -- a shake-up of the pension system which economists say will help finance welfare spending.

A report by PriceWaterhouseCoopers showed Poland offers the highest child subsidy of any central and eastern European country in the EU. But it is less than in France, which offers 130-167 euros ($144-185) per month, Ireland, which provides 135 euros, and Germany, where the subsidy is 184–215 euros.

Employers' groups, recruiters and unemployment officials say the number of mothers from poorer families quitting their jobs has grown since the subsidy was launched.

"We estimate that as many as 200,000 to 250,000 people may leave the workforce because of the subsidy," said Krzysztof Inglot of the human resources company WorkService based in southwestern Poland.

He said that receiving a subsidy for two children gave women "a logically perfect argument" to give up work, stay at home and save on childcare. This worries opponents of the PiS' drive towards a more conservative society.

"A woman's role is tied to her job as a mother in the PiS thinking," said Malgorzata Druciarek of the liberal Institute of Public Affairs think tank. "Giving women direct payments (for children) bolsters this stereotype."

The Congress of Women, a women's lobby group, has said the proposal will discourage women from working and therefore hit their pensions.

STEADY POLL RATINGS

The new subsidy is part of efforts by PiS to carry out promises it made in last October's parliamentary election to provide more economic fairness and revive national pride.

It also coincides with its policy of promoting traditional values in the predominantly Roman Catholic country and attempts to increase the birth rate to give the economy a lift.

Economists say the subsidy's cost is prohibitive at an estimated 23 billion zlotys a year, or just under half of Poland's fiscal deficit.

But it is proving effective for the government. Opinion polls show the PiS' popularity ratings are between 35 and 40 percent -- around the same level as when it won a parliamentary election in October with 38 percent of the votes.

The subsidy appeals -- and is especially beneficial -- to poorer people in small towns and villages, the traditional PiS electorate which felt neglected by the centrist Civic Platform that led Poland from 2007 until October.

The popularity of the subsidy has made it hard for the opposition to criticise it and has also helped offset concern and protests over changes to the constitutional court which critics, including the United States and the EU, say remove checks and balances on lawmakers, undermining democracy.

"(The subsidy) is a key factor behind the people's willingness to vote for PiS even though they understand what it does is a threat to democracy," said Aleksander Smolar, a liberal political analyst who runs the Stefan Batory Foundation.

A poll in April showed 60 percent of Poles are worried about the future of democracy, but another survey showed Poles have never been more optimistic about their economic situation.

PiS leader Jaroslaw Kaczynski has blamed recent protests against the government on "post-communists" resisting change.

"But we have been able to show a clear prospect for good changes, which will affect many people. For many, the 500+ subsidy is a concrete change," he told the rightist weekly wSieci.

(Additional reporting by Pawel Sobczak, Marcin Goettig, Wiktor Szary and Jakub Iglewski, Editing by Timothy Heritage)

reuters_tickers

 Reuters International