France to unveil new pension plans

By JONATHAN POWELL | China Daily Global | Updated: 2023-01-10 10:28

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Full details of the French government’s controversial pensions reform plan, which seeks to raise the retirement age from 62, are to be unveiled in the National Assembly on Tuesday, despite fierce opposition toward the proposals from trade unions and the public.

Prime Minister Elisabeth Borne will reveal specifics of the pension reform bill to lawmakers, before it is debated in Parliament at the beginning of February.

Reforming the nation’s complicated pension system was a keystone of President Emmanuel Macron’s election campaign when he came to power in 2017, but the initial proposals prompted weeks of protests and transport strikes just before the COVID-19 pandemic hit. The plans were put on hold in 2020 as the government hurried to contain the outbreak.

The pension reforms remain extremely unpopular with the public, according to polls, and have met with strong resistance from unions, which have threatened more industrial action on the issue. Macron’s government has sought to overcome this through building political support.

The right to retire on a full pension at 62 is treasured by the French public and it has always been a highly sensitive issue, Reuters reported.

The overhaul will likely raise the retirement age to 64 or 65, but to achieve it Macron’s government will require a working majority and must win over conservative lawmakers.

If he falls short of the support needed to pass the proposals, Macron may choose to use constitutional powers to bypass the assembly, which would likely infuriate opponents and further antagonize the public, noted French news outlet RFI.

Government spokesman Olivier Veran told reporters on Monday that the aim of the reforms is to “balance the accounts without raising taxes or cutting pensions”. He said “various options are on the table, but all include raising the retirement age”.

The government believes that the public mood has changed and the reform may now be more acceptable than previously, the spokesman said.

“We’re not reforming pensions to be popular but to be responsible. We’ll go all the way because it’s the only way our social model can survive,” he said.

According to the Organisation for Economic Cooperation and Development, France has one of the lowest retirement ages in the industrialized world. It spends more than most other countries on pensions at nearly 14 percent of economic output.

A 2022 report from the French pensions regulator found that government pension spending is expected to reach a deficit in the next 25 years, noted the Euractiv news website. Raising the minimum retirement age will ensure the system does not run out of funds, according to Macron’s government.

The proposals have already won the support of right-wing party Les Republicains, which confirmed on Sunday it will back the much-delayed reforms.

“The budgetary, demographic, and economic situation requires this reform,” Les Republicains President Eric Ciotti told the Journal du Dimanche.

“I, therefore, hope to be able to vote for a fair reform that saves our retirement system by distribution,” he added.

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