After many twists and turns, the explosive pension reform should finally be presented this Tuesday, January 10. The government would move towards a postponement of the legal retirement age to 64, accompanied by an acceleration of the extension of the contribution period provided for by the Touraine reform. An “indispensable” reform, according to the government, but not for the unions and the opposition, which are already preparing their weapons to fight against the reform. Who is right ? Decryption.
- Is the system defective?
To find out, you have to delve into the arid reports of the Pensions Guidance Council (COR), an independent service attached to Matignon and made up of social partners, members of the administration and experts on the subject. The latest outlook was published in September. And after two years of surpluses, in 2021 and 2022, the situation should deteriorate. “From 2022 to 2032, the situation of the pension system would deteriorate with a deficit ranging from -0.5 point of GDP to -0.8 point of GDP depending on the agreement and the scenario adopted”, estimates the COR.
The body then plans different scenarios for returning to equilibrium. In the best case, this would happen in the 2030s. In the worst case, it would have to wait until the 2070s.
- Do we really need to work more?
Postponing the retirement age or extending the contribution period, which would lead people to work longer before being able to retire, makes it possible to act on this financing problem. But other levers exist, such as increasing revenue (via employer and employee contributions), or reducing pensions for retirees.
It would also be possible to combine the three options. Problem, the government categorically refuses to hear about the last two levers, because they also have their share of economic and political disadvantages. The increase in contributions would indeed risk increasing the cost of labour, which is already one of the highest in Europe. The other option is socially explosive, especially in times of inflation, even though retirees have a higher standard of living overall than the rest of the population.
- Won’t the expected savings on pensions increase spending elsewhere?
This is a risk: if working people have to work longer, some seniors could find themselves unemployed, on disability or in long-term illness, because some companies are reluctant to keep them in their jobs or recruit them, or because they will no longer be able to work, especially in the most arduous jobs. As a result, part of the savings generated by the reform could evaporate. In order to counter this effect, the government must present a certain number of measures to promote the employment of seniors and better take into account hardship. It remains to be seen whether they will be sufficient.