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The concluding section sets out the organization of the rest of the report and summarizes the priority recommendations. 2 The term 'social security' is avoided because of its ambiguity. In US usage it refers to retirement pensions; in the UK it refers to the entire cash benefit system; and in mainland Europe (in accordance with ILO usage) it refers to all cash benefits plus health care. The term cash benefits has been used throughout. Page 2 B The Economic Transformation Program and the Social Safety Net Economic Reform and the Costs of Adjustment 6.

Emmanuel Jimenez and Martin Ravallion Page xi SUMMARY AND RECOMMENDATIONS Economic Reform and the Social Safety Net 1. This report describes the system of income transfers in Poland, assesses current arrangements, and makes recommendations for improvements. There are two main conclusions. First, current arrangements require reshaping to meet the needs of a market economy: additional expenditure is needed for unemployment compensation and poverty relief, with cuts in excessive spending on some other benefits.

Such savings might not be sufficient to meet all of the increased costs of unemployment and poverty but, at a minimum, would make a sizeable contribution. The main message is that it is possible, broadly within the existing resource envelope, to have an effective and adaptable social safety net which contributes to the overall objectives of the reform program. Page 1 PART ONE ANALYTICAL AND DESCRIPTIVE BACKGROUND Chapter 1 Cash Benefits and the Economic Transformation Program A Introduction 1. This report describes the system of cash benefits2 in Poland, assesses current arrangements, and makes recommendations for improvements.

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