Poland to lower retirement age in mid-2016: minister

WARSAW (Reuters) - Poland plans to lower the retirement age in mid-2016 as part of a broader social agenda put forward by the ruling conservative Law and Justice (PiS) party, Labour Minister Elzbieta Rafalska said on Wednesday.

PiS won a general election in October after promising Poles a wide range of measures that also included a monthly child benefit of 500 zlotys ($126), an increase in the tax-free allowance and free medicines for elderly people.

"It seems to me that the realistic date for implementing it (the lowering in the retirement age) is the end of the first half of next year," Rafalska told reporters.

She said the pension age reform, which reverses moves by the previous government, would cost 2.6-2.7 billion zlotys in the first year.

Parliament started debating the measure on Wednesday as part of a PiS drive to fulfil its broader election promises, a package that would cost a total of up to 45 billion zlotys next year, according to analysts' estimates.

The draft bill being debated in the lower chamber of parliament would lower the retirement age back down to 60 for women and 65 for men. Under the previous government, reforms were under way to raise it gradually to 67 for both sexes.

President Andrzej Duda has said that the retirement age policy would cost a total of 40 billion zlotys, spread over a number of years.

PiS has signaled it would allow for some fiscal loosening to finance its social program. This will include allowing a fiscal deficit of 3.2 percent of gross domestic product this year and the next.

Poland also plans to relax a self-imposed spending rule. PiS lawmakers sent to parliament a draft bill introducing a lower limit on public spending.

These plans have caused concerns among economists and Poland's European partners. European Commission Vice President Valdis Dombrovskis has said Poland should outline how it is going to keep its budget deficit within the European Union's limit.

On Wednesday Deputy Finance Minister Leszek Skiba told reporters that the draft budget bill for 2016 would include a deficit projection below 3 percent of GDP. Under the previous government, officials issued conflicting forecasts for the deficit.

(Reporting by Pawel Sobczak; Additional reporting by Marcion Goettig; Writing by Marcin Goclowski; Editing by Estelle Shirbon)