Analysis: Government walking on eggshells over coal

Photo: PAP/Andrzej Grygiel

The government’s plans to reform the coal industry have not gone down well in Silesia. After meetings between the government and miners leaders they have been put on ice.

The Ministry for State Assets was planning to present a restructuring programme for the coal industry on Tuesday. According to reports the plans included the liquidation of four mines as well as cuts in output and pay. Bonuses were to be reduced and pay linked to the financial state of the industry.

Speaking after a meeting with miners leaders the Deputy PM Jacek Sasin admitted that they had not accepted the programme that had been prepared by management of the Polish coal conglomerate. The press spokesman for the ministry informed that miners had not agreed to hear a presentation of the proposal. Prominent miners union leader Dominik Kolorz voiced total opposition and declared that if there were attempts to enforce it it would lead to “uprisings” in Silesia.

There followed a tense and acrimonious meeting with ruling Law and Justice (PiS) MPs from the area. They did not approve of the programme any more than the miners did. Following these meetings in Silesia it was announced that a joint working group would be formed to formulate an alternative plan by the end of September.

Government attempts reform

The plan that was to be discussed on Tuesday means that the government is looking at changing its approach to the coal industry. It is the first time the topic of mine closures and cuts in pay has been approached by the current administration. It is certainly a change of tone from recent election campaigns in which miners and the Silesian region were repeatedly told coal had a bright future.

During the coronavirus emergency when several coal mines had to suspend their output in order to quell the spread of infection coal miners were, unlike other groups of workers, paid 100 percent of their dues. At the time Deputy PM Sasin himself declared that none of the 12 mines then affected would be closed in future.

PiS backed the miners, the miners backed PiS

The ruling party has been supportive of the coal industry. President Andrzej Duda called the miners an “extraordinary brotherhood”. But the economics of the situation mean the present government, like its predecessors, is being forced into attempting to restructure the industry.

Politically PiS has benefitted from support from miners. It actually managed to win a majority in the province in the local elections and did well in the region in both the European and parliamentary polls. However, in the presidential election’s second round of voting President Andrzej Duda lost narrowly to the Civic Platform’s Rafał Trzaskowski.

The history of attempting reform

The last government that actually succeeded in any major restructuring was the Solidarity AWS administration (1997-2001). The next centre-left government in 2003 put 23 profitable and loss-making mines into one conglomerate. But this did not lead to any major restructuring of the industry.

The last Civic Platform (PO) led government did little to reform the coal industry. It did present a plan for increasing the competitiveness of the industry just a year before the parliamentary elections in 2015. The trouble was that the industry had for years been neglected with politically appointed managers satisfied to be drawing huge salaries.

The government backed down from plans to reform the industry in the aftermath of protests that became violent and led to the police’s controversial decision to use rubber bullets outside the coal company’s HQ in Silesia.

Politics of reform

PiS on coming to power did so with the support of the “Solidarity” trades union movement. The union had decided to back PiS after the PO’s decision to increase the age of retirement. As PiS and the trades union got politically closer, one of the parts of that relationship was for PiS to back the miners.

But the problems of the industry are not going away. Power companies have for years been importing cheaper and better quality coal from Russia. For a while higher demand for coal improved the state and prospects for the industry, but the pandemic downturn has altered the picture.

An additional problem is the pressure from the EU for Poland to accept climate neutrality by 2050. To do so Poland would be forced to make a radical move away from dependence on coal, which currently accounts for well over 70 percent of its energy mix.

The government is committed to developing renewable energy capacity and atomic power. If it does so the demand for coal will gradually be reduced.

The miners are still politically influential in Poland. In communist times they were one of the best paid professions in the land and all governments in that period sought to ensure that Silesia was looked after in terms of consumer and public goods.

Past history and present political commitments mean that the ruling party and its government will tread carefully. The coal industry is no ordinary industry in Poland. It would be a huge political achievement to square the circle of the needs to reform the industry and to get the social consensus politically required to do so.