French President Emmanuel Macron will press ahead this week with his long-promised and unpopular plan to overhaul his country’s expensive pension system by raising the retirement age, risking further street protests and a backlash from opponents. policies.
On Tuesday, his government will present its bill, which would require French citizens to work two or three years after the current retirement age of 62 to qualify for a full pension. In order to win support, the government will also offer sweeteners, such as an increase in the minimum pension and concessions for older people with physically demanding jobs.
But with unions pledging to strike against any rise in the retirement age and left and far-right parties preparing to challenge the reforms, the fight promises to be a test of whether Macron can achieve his second term program. Pensions have become a totemic issue for the French president, a symbol of his reformist ambitions and his ability to implement policies despite the loss of his parliamentary majority last year.
Macron’s centrist alliance now holds 251 seats in the National Assembly – below the 289 threshold needed to pass laws – so it has become more difficult to pass legislation.
Even Macron’s allies recognize that the stakes are high and the potential for social unrest considerable as households are already feeling the pressure of runaway inflation and an economic slowdown. Polls show that around 70% of French people oppose raising the retirement age.
“If this reform does not pass, it will probably complicate the president’s second term because it could be seen by some as a sign of weakness,” said Marc Ferracci, MP for Macron’s Renaissance party. “But I don’t think that’s going to happen. I think we will be successful in getting something through even though the exact parameters may change.
The overhaul of the French pension system was a key element of Macron re-election campaign And this comes after trying a different version of the reform in 2019 which was abandoned during the Covid-19 pandemic.
The French president argues that raising the retirement age is the only way to preserve the system as the active-to-retired ratio declines in the coming decades. He ruled out other approaches such as raising taxes, lowering pensions or increasing public debt.
“We have to work longer,” he said in his televised New Year’s address. The aim of the reform was to “strengthen the pension system, which if we do nothing will be threatened since we will depend on the debt to finance it”.
The government also asserts that raising the retirement age is necessary to improve the situation relatively wrong record on keeping older people in the labor force. Its employment rate for people aged 55-64 is 56%, compared to an average of 59% in EU countries and 61% in the group of advanced economies in the OECD. Only about half of French people are still working when they turn 62.
The state pension system, which relies on workers funding retiree benefits, will post a small budget surplus this year, according to a recent report by a state pension agency. Consultative Committee. But deficits are projected over the next decade and beyond, with the number of workers per retirement rising from 2.1 in 2000 to 1.7 in 2020 and a projected 1.2 by 2070.
Without reform, pension spending could potentially threaten the government’s deficit reduction targets, the report added, meaning France would fall under EU debt ceiling rules.
Macron’s opponents disagree with his pension diagnosis and remedy. Left-wing parties advocate lowering the retirement age to 60 and raising taxes to fund it. Far-right leader Marine Le Pen has declared her “radical opposition” to raising the retirement age and called Macron’s proposals “woefully unfair and ineffective”, especially for blue-collar workers starting out. to work at a young age.
The only opposition party that has shown itself open to backing Macron’s bill is the conservative Les Républicains party, which has long advocated raising the retirement age to 64 or 65 to boost public finances.
But in a meeting with Prime Minister Elisabeth Borne on Friday, Olivier Marleix, who leads the LR group of 62 deputies in the National Assembly, formulated specific demands that must be met to secure their votes.
This included raising the retirement age to 64 instead of 65, while gradually extending the working time needed to access a full pension. LR also wants to increase the minimum monthly pension from around €900 to around €1,200 and apply the change to current and future pensioners.
“I told the prime minister that either it will pass with our votes or it won’t pass at all,” Marleix said in an interview.
If no agreement can be reached with LR, the government is likely to resort to adopting the pension bill by decree, using article 49.3 of the constitution. The tactic, once rarely used, allows governments to override parliament and effectively ignore legislators, but it also allows the opposition to respond with a motion of no confidence. The Macron government has used the constitutional maneuver 10 times out of budget related invoices since June.
“Our goal is not to trigger Article 49.3, but to build consensus for a majority vote,” Labor Minister Olivier Dussopt told Le Parisien newspaper last week.
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