Feb 6, 2023
French Pension Debate to Start in Parliament as New Strikes Loom
(Bloomberg) -- France’s National Assembly will start debating French President Emmanuel Macron’s pension reform bill on Monday as unions gear up for two more days of strikes and protests against the plan this week.
So far, neither the government nor opponents to the change have given much ground. Macron has pledged to see his program through, which includes increasing the minimum retirement age to 64 from 62, while unions have called on the French to protest in even greater numbers on Tuesday than they did last week.
Prime Minister Elisabeth Borne did offer some marginal concessions on Sunday in an effort to win over the conservative Republicains party, which has said it could back the pension bill under certain conditions. Were it to give its support, it would provide enough votes to pass the bill in the lower house and allow the government to avoid having to do so by decree.
Read more: French PM Offers Concession in Battle Over Pension Reform
Borne has said that the move to 64 is non-negotiable, and the government has repeatedly said that backing down would endanger a fundamental part of its strategy to steady France’s deficit-ridden finances and improve the economy’s capacity to grow and create jobs. On Sunday, she said the government is considering another carve-out so more people can retire before the new minimum age.
“What she’s doing is tinkering,” Philippe Martinez, the head of the CGT union, said on France 2 television on Monday. “For the CGT, the response is clear: we’re carrying on.”
Lisa Thomas-Darbois, a French politics expert at the Paris-based Institut Montaigne, said the unusual convergence of all major unions has contributed to the magnitude of the mobilization, which pulled in at least 1.27 million protesters on Jan. 31, a number she expects to increase.
She added that the president nevertheless has the upper hand because of the constitutional tools that allow him to bypass parliament if needed. “Macron has all the cards in hand to pass the reform,” she said.
Borne and Macron have so far failed to convince a majority of French people to back the plan. Rather they have lost ground since it was released in January in several opinion polls, which consistently show that a majority of the French oppose the bill.
Both previous protests gathered more than a million people across France and brought significant disruption. Trains, subways and trams in French cities, including Paris, only provided limited service, some flights were cancelled and many schools were closed. Protesters also blocked oil refineries operated by TotalEnergies SE, and strikes by Electricite de France SA’s workforce cut part of its electricity output.
For Tuesday, the civil aviation authority has asked airlines to reduce traffic at Paris’ Orly airport by 20%. Railway operator SNCF said it expects around half of France’s high-speed TGV trains to operate and advised travelers to cancel or postpone their trips. Some EDF and TotalEnergies workers plan to strike again as well.
Labor unions argue that changing the minimum retirement age will unfairly hit the low-skilled and the least wealthy who began working earlier in life. They also say that there are better ways to boost employment among older workers and bring the retirement system into financial balance, including tax increases — which Macron has ruled out.
Without changes to the retirement system, it alone is set to record an annual deficit of as much as 0.8% of annual economic output during the next 10 years, according to France’s Pensions Advisory Council. That will come at a time when the government is also seeking to devote more funds to investment in industry and the green transition.
--With assistance from Phil Serafino and William Horobin.
©2023 Bloomberg L.P.
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