French Prime Minister Élisabeth Borne has presented the government’s controversial pension reform bill, saying that it will help to “guarantee the future of our pension [system]”.
EN DIRECT I Pour nos retraites : un projet de justice, d'équilibre et de progrès.— Gouvernement (@gouvernementFR) January 10, 2023
Présentation par la Première ministre @Elisabeth_Borne et les ministres @BrunoLeMaire, @olivierdussopt et @StanGuerini. https://t.co/Wzk6EIYZ2o
We look at the contents of the bill.
Pushing the retirement age back to 64
The plan is to gradually push the French retirement age back from 62 to 64 years of age.
This would mean that people born after September 1, 1961, will be able to retire from the age of 62 years and three months and the date would be pushed back for younger groups.
By 2030, the retirement age would reach 64 for people born in 1968. This marks a change to the pension of age of 65 in 2031, as President Emmanuel Macron had initially envisaged.
À compter du 1er septembre, l'âge légal de départ à la retraite sera relevé progressivement de 3 mois par année de naissance pour atteindre 64 ans en 2030. pic.twitter.com/YCUr9atmlJ— Élisabeth BORNE (@Elisabeth_Borne) January 10, 2023
Minimum monthly pension increased to €1,200
As pledged by President Macron, the government is looking to increase the minimum pension payment by €100 per month to €1,200 (gross) for people retiring after September 1, 2023.
Therefore, a person who has earnt the minimum wage (known as the Smic in French) for their whole career will earn 85% of their original salary.
In future, the minimum pension payment will be indexed on the Smic rather than inflation so that the 85% proportion continues to be applied.
Aurore Bergé of the ruling parliamentary group Renaissance has called for this payment increase to be applied to existing pensioners as well, and the government has said that it will work on “revising” the amount people currently receive.
“Nearly two million small pensions will be increased,” Ms Borne has said.
Une vie de travail doit garantir une retraite digne.— Élisabeth BORNE (@Elisabeth_Borne) January 10, 2023
Les salariés, artisans et commerçants qui ont cotisé toute leur vie avec des revenus au niveau du SMIC partiront désormais avec une pension revalorisée à 85% du SMIC net.
C'est près de 1200€ par mois dès cette année. pic.twitter.com/Bi18Q9bepA
Pension contributions to be paid over 43 years
People would also gradually be required to pay pension contributions over 43 years (172 quarters) by 2027.
This evolution had previously been planned for completion by 2035, so this change would bring it forward by eight years.
So, in order to access a full pension, workers born after September 1, 1961 will have to have paid 169 quarters of contributions (42 years and three months), and those born after 1965 will be the first to pay 43 years’ worth.
‘Long career’ scheme retained
No one who started working before the age of 20 will have to work more than 44 years.
Currently, the ‘long career’ scheme (carrières longues) enables those who started working before the age of 20 to retire at 60, and those who started before the age of 16 to stop working at 58 as long as they have made enough contributions.
This affects about one in five workers at the moment.
Under the government’s planned reform, people who started working before 16 would still be able to retire at 58 and those who started at the age of 16-18 would be able to stop at 60.
Those who began work at 18-20 years of age will be able to retire at 62.
Early retirement rules maintained
The reform would also retain a scheme through which people with a disability or long-term condition are able to draw their full pension at 55 or 62 depending on their situation.
Those who have been exposed to asbestos can continue to retire at 50.
Over 15% of retirements involve people included in these schemes.
Workers who have suffered an accident at work or a work-related illness will still be able to retire early, although at 62 years rather than 60 currently.
In addition, years spent caring for an elderly parent or disabled child will now be included in calculations for early retirement.
Continued recognition of strenuous labour
Access to the Compte professionnel de prévention (C2P), which enables workers employed in strenuous or onerous labour to retire early, will be extended to people entering the jobs market.
More than 60,000 extra people will be concerned by this scheme each year, including people working night shifts or those exposed to significant risks through their job.
These workers will also be offered a detailed medical check-up halfway through their career.
Efforts to encourage senior employment
In France, only one third of people aged 60-64 were working in 2021, according to Eurostat.
The government is now looking to introduce an index recording the proportion of people in companies of more than 1,000 people who are over 60. This will be extended to companies of more than 300 employees from 2024.
“Refusal to participate in the index will result in penalties,” Work Minister Olivier Dussopt has said.
Rules surrounding pension payments for those still working will be adapted so that retirees who choose to remain employed can receive more.
Now for parliamentary debate
“This presentation is not the final version; we are prepared to adapt our project,” Ms Borne said.
The bill will now be presented to the Conseil des ministres (Cabinet) on January 23, then debated in the Assemblée nationale on February 6, before a planned adoption before the end of the year.
An agreement with the right-wing Les Républicains means that the government can hope to pass this bill without having to use article 49.3 of the Constitution, which enables it to unilaterally push bills through parliament without a vote.
However, the bill has already been met with significant opposition from unions, which have formed a united front against its contents.
How are unions reacting?
“We are determined that this bill will not be passed,” Philippe Martinez, leader of the CGT union, has said.
Laurent Berger of the CFDT has, for his part, criticised “one of the most brutal pension reforms from the last 30 years.”
France’s eight biggest unions – the CFDT, CGT, FO, CFE-CGC, CFTC, Unsa, Solidaires and FSU – have called for a day of demonstrations on January 19.
The last time the unions mobilised in such a way was in 2010, over the reform which moved the retirement age from 60 to 62.
“We will need a huge movement to make them go back [on this], we cannot content ourselves with a half success,” Cyril Chabanier of the CFTC has said.
A survey carried out by Odoxa-Agipi for Challenges and BFM Business at the beginning of this month found that 80% of French people are opposed to the retirement age being put back.
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