PARIS — The French government is pushing ahead with its planned reform of the pension system, despite ongoing mass strikes.
French Prime Minister Edouard Philippe announced details of the planned reform on Wednesday after seven days of strikes in protest at the plans that caused chaos for commuters and involved lawyers, teachers, nurses, truck drivers and others.
The reform aims to streamline the current system and make it more fiscally sustainable. Philippe said the government wants to scrap the current complex set-up of more than 42 industry-specific, state-funded pension plans, and replace it with a universal one based on a points system in which every French person would have their own pension “account” that could transfer from job to job.
“The time has come to build a universal pension system; the president announced it in his campaign program,” Philippe said in a speech that seemed more geared toward rallying public support than appeasing labor unions. “We are proposing a new pact among generations.”
The pension reform was a central part of French President Emmanuel Macrons 2017 presidential campaign program, and there are no signs he plans to back away from it. Beyond his own campaign promise, Macrons ability to carry out the ambitious EU reforms he envisions would be undermined if he failed to implement changes at home. He is also trying to woo the right-wing electorate ahead of upcoming municipal elections.
“The red line has been crossed” — Laurent Berger, secretary-general of the CFDT
The most controversial announcement in Philippes speech was about the retirement age. According to the plans, the legal retirement age will remain 62 years, but incentives will be provided to encourage people to work until later, with an envisioned average of 64.
“Without forcing them to, we must incentivize the French people to work longer,” Philippe said.
Unions were furious.
“The red line has been crossed,” said Laurent Berger, secretary-general of the CFDT, the biggest French labor union, in response to the retirement age proposal. His organization was one of the few big labor unions that had been at least partly supportive of the planned reform until now.
Protestors chant and sing songs to oppose pension reforms on December 10, 2019 in Paris | Kiran Ridley/Getty Images
“The dilemma now will be whether to work longer or earn less,” said Boris Vallaud, a Socialist MP.
Several major labor unions have now called for a redoubling of the strike action, including rail workers and police officers.
However, the government made some concessions to unions, with whom it has been negotiating on the plans for 18 months.
In his speech, Philippe said anyone within 17 years of retirement would be exempt from the new system, and that it would eventually apply to those born in 1975 and later, instead of to those born in 1963, as initially suggested in a report by the High Commissioner for Pensions Jean-Paul Delevoye. Philippe also conceded a long transition period from the current 42 separate state-funded plans to a universal one, and committed to guaranteeing a minimum pension of €1,000 per year.
“We will have a golden rule so that the value of points acquired cannot diminish, and inscribe in the law that the points be indexed to salaries which rise faster than inflation in our country,” the prime minister said.
Philippe defended the points-based system as being fairer, saying it would give every pensioner the same rights for each euro contributed and be better adapted to the modern-day labor market in which people change jobs and industries more frequently.
“We know our children wont have the same linear careers we had and we need a pension system that allows that,” he said.
“We cannot accept the reform as it was presented today. We call for new protests. The government doesnt have the support of any labor union” — Olivier Faure, Socialist Party leader
He also explained that pensions based on points accrued instead of trimesters worked, as is currently the case, would better reflect the actual amount of time worked in the gig economy by the likes of office cleaners or bicycle couriers.
Philippe made a special effort to highlight the benefits women would gain from the new system. On average, womens pensions are currently half the size of mens. He also tried to explicitly reassure teachers, police officers, firefighters, soldiers and nurses. But he conspicuously left out rail workers, who have been the most adamant opponents of the reform and haRead More – Source