By Alan Charlish and Pawel Florkiewicz
WARSAW (Reuters) - Poland moved closer to ratifying legislation essential to the European Union COVID-19 recovery fund on Tuesday, after the prime minister said the government had approved it and agreed to opposition proposals on how money should be spent.
All of the EU's 27 members must ratify a decision by the bloc to increase the upper limit for national contributions to the EU budget, in order for it to borrow the 750 billion euros ($905.78 billion) needed to implement the recovery fund.
However, splits in Poland's ruling United Right coalition over the plan have made opposition support necessary and even raised the possibility of early elections if the government cannot secure majority backing in parliament, which would compound the sense of instability in an alliance that has been racked with tensions for months.
"Today it must be emphasised with full force that the pace of overcoming the COVID crisis will depend on whether these funds can be accepted," Prime Minister Mateusz Morawiecki told reporters after a cabinet meeting.
He added that the bill would now go to parliament.
United Poland, a junior partner in the governing coalition, is opposed to the EU recovery plan, which it says could see predominantly Catholic Poland forced to accept liberal policies like gay marriage and become saddled with debt.
The party reiterated its opposition to the recovery fund in a statement on Tuesday, but said it remained committed to the coalition, which shared a "common vision of the fatherland" despite its differences.
A meeting between the government and the Left parliamentary bloc yielded agreement on the latter's proposals on how funds should be spent, including building 75,000 flats in Poland for rent, investing in hospitals and supporting sectors worst affected by the pandemic.
Opposition parties have been split on whether to give the divided government the votes it needs to pass the legislation, with some insisting the issue should be used to bring about early elections.
($1 = 0.8280 euros)
(Reporting by Alan Charlish, Pawel Florkiewicz, Anna Koper and Agnieszka Barteczko, editing by Susan Fenton and Mark Heinrich)