Pension reform: Macron wants to act quickly, who is concerned?

Pension reform Macron wants to act quickly who is concerned

PENSION REFORM 2022. The Minister of Labor Olivier Dussopt receives the social partners this Monday to address the issue of pensions. For now, neither the unions nor the MEDEF seem to want to let go of the ballast against the executive.

[Mis à jour le 19 septembre 2022 à 08h15] This Monday, September 19, the Minister of Labor Olivier Dussopt receives the unions and employers to draw the outlines of the future pension reform which has been skating for many months. Last week, the President of the Republic Emmanuel Macron announced that he wanted to carry out a pension reform “through social consultation”. Only small problem, the unions are, for the time being, absolutely not inclined to the discussions. The government still intends to make the French work longer because of longer life expectancy, and later entry into the labor market from year to year. The executive could then become impatient and try to push through. An amendment within the framework of the Social Security financing bill cannot be ruled out. For his part, the very close to President Macron, François Bayrou believes that “reform is vital, it is a necessity for the country” as he wanted to recall this Sunday, September 18, at the microphone of Sonia Mabrouk in Le Grand Rendez -you.

On Thursday 15 September, the Pensions Orientation Council submitted its annual report. Conclusion: the French pension system should experience a surplus of €3.2 billion in 2022 (0.1 point of GDP). A deterioration is however expected, and the system should be in deficit for several years, before a potential return to balance estimated between 2027 and 2030. Information should not fail to reignite the fuse between government and unions. On the government side, this should be used to justify the wish to raise the legal retirement age, or to play on the contribution period.

On the sensitive issue of pension reform, already envisaged in 2017 but which could not be completed due to the health crisis, Emmanuel Macron has, it seems, dropped a little ballast, showing himself less firm only initially. While the outgoing president advocates a retirement age of 65, he explained that the project could be reviewed at 64. “As soon as the reform passed during the five-year term, we will shift the legal age by 4 months each year. From 2023, there will be a four-month shift, four months the following year, which means that we will reach around 64 in 2027-2028. And there must be a review clause. he said last April. Or at the end of the quinquennium. Could the reform stop there? Nothing is less sure. Here are the main points of the pension reform envisaged by Emmanuel Macron:

  • The system by division is kept
  • the gradual postponement from the legal retirement age to 65 years with addition of 4 months per year from 2023 and until 2032. A person born in 1961 could retire at the age of 62 and 4 months in 2023 or 2024 against 62 years for a person born in 1961 and expected to retire in 2023. The generation born in 1969 would retire at age 65. But a review clause would be introduced in 2017-2028, when the age will then have been pushed back to 64, if the reform is adopted.
  • “The long careers” and the “reality of trades and tasks” would be taken into account, a way of recognizing hardship but via “individualized” factors.
  • Minimum pension at full rate of 1,100 euros per month
  • Removal of special diets for new RATP employees
  • Indexation of retirement pensions on theinflation

As announced by Emmanuel Macron, if the pension reform project were to come into force, the legal retirement age would be gradually shifted by four months per year from 2023. De facto, it is the generation of 1961 who would be the first concerned by the device.

On the contrary, a measure should concern all current retirees: the revaluation of the minimum retirement pension to 1,100 euros per month. Please note that the discussions have not yet been concluded, and no date of entry into force of these potential measures has yet been revealed.

The end of the special regimes and the raising of the retirement age was one of Emmanuel Macron’s flagship projects in 2017, it will not come into force in 2022. However, this pension reform remains a fundamental issue of this campaign, whatever the political side. As a reminder, the Government had decided to activate Article 49.3 of the Constitution to pass without a vote the famous pension reform in the National Assembly on February 29, 2020. A maneuver widely decried at the time, deemed like a “denial of democracy” by Insubordinate France. The pension reform itself was also subject to strong criticism, even today.

The initial objective was to create a universal system, by points and by pay-as-you-go, thus eliminating special regimes (SNCF, electricity and gas industries, RATP, etc.). “From 2022, we will have to make clear decisions,” he had already warned in November 2021. In this month of september 2022, exchanges are likely to be extremely tense between the unions and the Swiss government wants to act urgently. “All avenues are being studied, including the avenue that would lead us to propose a reform through the Social Security financing bill,” declared government spokesman Olivier Véran after the Council of Ministers of Wednesday, September 14, 2022. The Pensions Orientation Council (COR) promises a pension deficit of between 9 and 11 billion euros for 2027. Enough to push the government to pass even more quickly a reform that promises to be more contested than ever.

It unleashed passions, aroused the anger of the social partners, including the unions initially favorable to the project. Suspended sine die, the pension reform has had many twists and turns. invites you to review the chronology of this controversial social project in a few key dates:

  • May to December 2018 : the High Commissioner for pension reform, Jean-Paul Delevoye is conducting consultations with the social partners and a citizen platform has been launched.
  • July 18, 2019 : the High Commissioner submits his report on the pension reform to the Prime Minister, Edouard Philippe.
  • September 12, 2019 : speech by Prime Minister Edouard Philippe before the Economic and Social Council (Cese). It reveals the main principles of the reform, largely repeating the Delevoye report.
  • September to December 2019 : new round of negotiations on the pension reform with the social partners. It relates in particular to the solidarity mechanisms, the age and duration of contributions, the future balance of the pension system and the mode of governance. A new citizen platform is open, and information meetings are held throughout the territory.
  • December 5, 2019 : the social conflict begins. Many professions such as lawyers, opposed to pension reform, are taking to the streets.
  • January 24, 2020 : presentation of the pension reform in the Council of Ministers, consisting of an ordinary law text and an organic law text. The Council of State gives a particularly critical opinion on the bill, and in particular on the impact study, made up of a thousand pages. The social partners and the executive are struggling on the thorny issue of the pivotal age. The government promises to launch a conference on the financing of the pension system in April.
  • February 2020: pension reform is studied in the National Assembly, first in the social affairs committee, then in plenary session. The oppositions multiply the amendments to block the legislative process.
  • Early March 2020 : the bill is adopted thanks to 49.3.
  • Mid-March 2020 : the President of the Republic announces the suspension of major reforms, in the context of a health emergency.
  • Summer 2020: newly appointed Jean Castex indicates the pension reform will be maintained. He calls for a new inventory of the finances of the pension system.
  • October and November 2020 : The COR publishes a progress note, as well as its annual report, reporting on a widened deficit due to the crisis.
  • June 2021: the COR publishes a report on the deficit created by the crisis, standing at 13 billion euros.
  • July 6, 2021 : social summit at the Elysée
  • November 10, 2021: the President of the Republic, Emmanuel Macron, renounces to put in place a pension reform by the end of his mandate.
  • December 15, 2021: During a program on TF1 “Where is France going?”, Emmanuel Macron talks about his vision of the reforms to come, including the need for a reform of the pension system. He now evokes the possibility of a system with “three regimes” and an extension of working hours to qualify for retirement.
  • March 2022: Emmanuel Macron’s pension reform project has been abandoned, but remains one of the main campaign themes and a fundamental issue of the 2022 presidential election.
  • April 2022 : Emmanuel Macron is in favor of raising the legal retirement age to 65 gradually. That is a decline of 4 months per year until 2032.
  • June 2022 : Emmanuel Macron and Together! lose the absolute majority in the National Assembly during the legislative elections. The majority will have to form alliances with certain parties such as the MoDem or Horizons. What about raising the legal retirement age to 65?
  • September 2022 : Olivier Dussopt, Minister of Labor receives employers and unions to reach an agreement on pension reform after the publication of the annual report of the Pensions Orientation Council.