What do we know about the reform that the government will introduce?
The government will announce details of the pension reforms on January 10, but the main points are already known. The legal retirement age will be lowered from 62 to 64 or 65, and the generation of 1961 will be the first to be affected.
Finally, not on December 15, but on January 10, the government will present the pension reform. All unions, the opposition and even a part of the majority object to this project, whose main lines are clear. This reform is already considered potentially “explosive”.
The legal retirement age is 65 or 64
The executive has already started preparing ideas, press interviews, business meetings at Matignon and summit dinners at the Elysée. But the plan is a foregone conclusion, marked by a promise to lower the legal presidential age from 62 to 65.
Deferral up to 64 years is now noted, but with a trade-off: an increase in the contribution period. According to the head of state, increasing the retirement age will not increase the savings, nor reduce the amount of pensions.
From the “61” generation
Unlike before, this reform will cover those who are about to retire. The first generation of concern is that of the second half of 1961, a population that could theoretically end their professional careers next summer.
Everyone will be affected, including those with long careers. Those who started working before the age of 20 and want to quit at the age of 60 will have to work two more years at the age of 62.
In compensation, the minimum amount of the new retirees’ pension will be increased to 1,200 euros for those with a full career. As for difficulty, those that have been phased out over the last five years (painful postures, handling heavy loads, etc.) will be reintroduced. The government also plans to introduce an age index to monitor companies’ behavior in terms of training and hiring people over 55.
The government does not want to waste any more time, but it also takes time for consultation. This project, which was supposed to be presented on December 15, will finally be presented on January 10, Emmanuel Macron made a presentation on Monday. Consultations with trade unions and employers’ organizations will begin on January 2. The goal remains for the reform to enter into force in the summer of 2023.
Meanwhile, the text will pass through two chambers, the National Assembly and the Senate. If no majority is formed, it is likely that the government intends to use the constitutional weapon to pass the vote of 49.3. This urgency is justified by the continued repayment of the massive deficit, which will exceed 12 billion in 2027.
The battle in the Assembly promises to be difficult. All opposition parties are against it, and even within the majority, this project causes strong reluctance. François Bayrou, president of Modem, believes that awareness-raising activities have not been carried out.
Mathilde Panot, head of LFI MPs, vows to “fight step by step” the barrage of amendments. Marine Le Pen (RN) declared that she was “absolutely completely against the grain” of the reform. The leaders of the various parliamentary groups will be received again in Matignon on Monday and Thursday morning.
No trade union accepts this reform, not even the CFDT, which toughened its stance on the issue at its last congress in June. Since then, its leader, Laurent Berger, has opposed any “age measure” and warned against “hard reform” that would provoke an “equally decisive social reaction”.
His CGT colleague Philippe Martinez also calls on the executive to “take it seriously”, but without any illusions: “They are stubborn”. His troops also know how to be tough, as the recent refinery blockades reminded us. Amid record inflation and wage demands, the warning shots also hit the electricity and gas industry, as well as the RATP, whose special regimes are the focus of the government.
These warnings raise the specter of social conflict in the winter of 2019-2020, which has been joined by railway workers, truck drivers and dock workers, among others. But union strategists are waiting for the right moment to fight. Eight national centers (CFDT, CGT, FO, CFE-CGC, CFTC, Unsa, Solidaires and FSU) came together after Elisabeth Borne’s statements and planned to respond around the project’s presentation date. In the Council of Ministers – January 10, Monday, Emmanuel Macron confirmed.
Too much reform?
Over the past three decades, France has implemented a series of major reforms to its pension systems to respond to an aging population and the deterioration of its funds.
In 1991, the White Paper highlighted the future financial difficulties of the schemes and recommended that the payment period to benefit from the full pension be extended from 150 to 168. In 1993, the Balladur government increased the private sector pay period for full retirement from 37.5 years to 40 years (150 to 165). Now the amount of pensions is calculated not for the best 10 years, but for the best 25 years of working life
In November 1995, during the presidency of Jacques Chirac, the reform of his prime minister, Alain Juppe, did not pass. Its purpose was to reform the pension system of civil servants and public services. For almost a month, public transport has been closed due to holidays.
In 2003, the reforms of Francois Fillon, Minister of Social Affairs of the Raffarin government, complemented Balladur’s reform and increased the contribution period for civil servants to 40 years. This leads to strikes and demonstrations. Only accepted by CFDT.
In 2007, Nicolas Sarkozy’s reform concerned the specific regimes of public service companies (EDF, GDF, SNCF, RATP, Banque de France, etc.) as well as professions with special status (notaries’ clerks, elected officials and parliamentary staff). For these employees, the contribution period increases to 40 years.
The 2010 Woerth reform ends the principle of retirement at age 60. The statutory retirement age is gradually increased to 62 years by increasing it by two years. The same applies to the departure age (age 67 in 2022). The reform extends the long career system to 17-year-olds and allows early departures.
In 2014, the reform of Marisol Touraine, Minister of Social Affairs under the presidency of François Hollande, wrote in time the principle of extending the contribution period to get a full pension. It is increased by a quarter every three years from 2020 to 2035, reaching 172 quarters (43 years) for 1973 and later generations. A personal hardship account has been created so that those working in difficult jobs can anticipate their departure.