French president Emmanuel Macron will push ahead this week with his long-promised and unpopular plan to overhaul his country’s costly pensions system by raising the retirement age, risking renewed street protests and a backlash from political opponents.
On Tuesday his government will present its draft law, which is expected to require French citizens to work two or three years past the current retirement age of 62 to qualify for a full pension. In a bid 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 labour unions vowing to strike over any rise in the retirement age and leftwing and far-right parties gearing up to contest the reforms, the fight is shaping up to be a test of whether Macron can deliver on his second-term agenda. Pensions have become a totemic issue for the French president, a symbol of his reformist ambitions and capacity to enact policies despite losing his parliamentary majority last year.
Macron’s centrist alliance now holds 251 seats in the national assembly — short of the threshold of 289 needed to pass laws — so getting legislation through has become harder.
Even Macron’s allies acknowledge that the stakes are high and the potential for social unrest considerable because households are already feeling the pressure from soaring inflation and an economic slowdown. Polls show about 70 per cent of French people oppose raising the retirement age.
“If this reform doesn’t pass, it will probably complicate the president’s second term as it could be seen by some as a sign of weakness,” said Marc Ferracci, an MP from Macron’s Renaissance party. “But I don’t think that’s what is going to happen. I think we’ll get something through even if the exact parameters may change.”
The French president argues that raising the retirement age is the only way to preserve the system as the ratio of workers to retirees falls in the coming decades. He has ruled out other approaches such as raising taxes, lowering pensions or adding to the public debt.
“We must work longer,” he said in his televised New Year’s address. The goal of the reform was to “strengthen the pensions system, which if we do nothing will be threatened since we will rely on debt to finance it”.
The government also argues that raising the retirement age is needed to improve France’s relatively poor record on keeping older people in the workforce. Its employment rate for those aged 55-64 is 56 per cent, compared with a 59 per cent average in EU countries and 61 per cent across the OECD group of advanced economies. Only about half of the French are still working when they reach 62.
The state pension system, which relies on workers funding retiree benefits, will have a slight budget surplus this year, according to a recent report from a governmental pension advisory panel. But deficits are forecast in the coming decade and beyond as the number of workers per retiree falls from 2.1 in 2000 to 1.7 in 2020 and a projected 1.2 by 2070.
Without reform, pensions spending could eventually threaten the government’s deficit reduction targets, the report added, meaning France would fall foul of EU debt ceiling rules.
Macron’s opponents disagree with both his diagnosis and remedy on pensions. Leftist parties advocate cutting the retirement age to 60 and raising taxes to finance it. Far-right leader Marine Le Pen has declared her “radical opposition” to raising the retirement age and called Macron’s proposals “terribly unjust and ineffective”, especially for blue-collar workers who start working at a young age.
The only opposition party that has signalled openness to backing Macron’s draft law is the conservative Les Républicains, which has long advocated raising the retirement age to 64 or 65 to boost public finances.
But in a meeting with prime minister Élisabeth Borne on Friday, Olivier Marleix, who heads the LR group of 62 MPs in the National Assembly, laid out specific demands that must be met to secure their votes.
They included raising the retirement age to 64 rather than 65, while gradually lengthening the working time required to access a full pension. LR also wants to increase the minimum monthly pension to about €1,200 from about €900 and apply the change to existing as well as future retirees.
“I told the prime minister that either this will pass with our votes or it will not pass at all,” Marleix said in an interview.
If no agreement can be reached with LR, the government is likely to resort to passing the draft pensions law by decree, using Article 49.3 of the constitution. The tactic, once rarely used, allows governments to override parliament and in effect ignore lawmakers, but it also permits the opposition to respond with a no-confidence motion. Macron’s government has used the constitutional manoeuvre 10 times on budget-related bills since June.
“Our goal is not to trigger article 49.3, but to build consensus for a majority vote,” labour minister Olivier Dussopt told Le Parisien newspaper last week.