On January 24TH, French Prime Minister Edouard Phillipe presented President Emmanuel Macron’s controversial pension reform plan. The law has now moved on to the National Assembly, where debates are slated to begin on February 17TH.
Mass protests, which have been occurring since December 5TH, swelled in immediate response. It remains unclear, however, what concessions citizens hope to wring now that the law has been passed. The reform remains the most ambitious overhaul of France’s complex and generous pension system since World War II, and aims to replace it with a universal points-based system.
A government spokeswoman has said that the proposed reform would create a “durable, solid” system that “provides for equitable intergenerational justice, protects the most vulnerable, restores trust and restores value to work”.
The country currently has one of the earliest retirement ages among industrialised world nations. Pensioners enjoy the third highest income level on a purchasing power basis in all of the EU, behind only Luxembourg and Austria. But with citizens living longer and fewer young workers needed to enter the job market, the system has acquired a deficit of billions.
On Thursday, January 23rd, demonstrators marched by torchlight in Paris ahead of a “Black Friday” of strikes and shutdowns, which was comprised of over 350 protests taking place throughout France. Thousands attended the next day, causing a spike from what had been the gradual winding down of large-scale remonstrations. Days later, firefighters marched through the capital in protest – again by the thousands – with some going to so far as to set themselves on fire.
Current strikes are the longest the country has seen in 40 years, and unions hope they can force the government to back down. “Our determination remains intact”, Yves Veyrier, head of the Force Ouvrière union, told reporters. “We have weeks, months, of protest ahead of us”.
Polls indicate that 61 percent of French people are against the reform, but President Macron has persisted in pushing forward – insisting that these changes are needed to keep a flexible work market, as the current system deters job mobility. At present, France has a byzantine set of 42 different pensions systems, which Macron plans to replace with a one-size-fits-all points system that equalises what everyone receives per euro put into it. Prime Minister Philippe also insists that the restructuring must result in a balanced pension budget by 2027; leaving the system as is would render such a goal impossible. But workers claim these changes will require citizens to work longer before they can retire.
Unions Step In
Unions have so far managed to force the government to withdraw a proposal that would raise the retirement age for full pension by two years, from 62 to 64. However, that leaves the pension budget underfunded, and the provision will be revived if they cannot offer an alternative before the bill is voted on this summer. A meeting between the government and labour leaders, intended to discuss alternative ways to fund the pension system outside of raising the retirement age, also took place last week.
France’s supreme administrative jurisdiction, the Council of State – which holds an advisory role to the government – warned that their financial forecasts of the proposed pension reform were incomplete and could, therefore, not guarantee the legal certainty of the bills the cabinet had approved.
The council had also previously warned that its studies regarding future financial impact were insufficient. An expanded investigation the government submitted mid-January was noted as “still incomplete”, and lacking full analysis on how the reform could affect both the unemployment welfare system as well as the employment rates of senior workers.
“This situation is all the more regrettable because the bills lead to a reform of the pension system that is unprecedented since 1945 and aims to transform for decades to come a system that is a major component of the social contract”, the council said.
Philippe Martinez, head of the powerful CGT union since 2015, said Macron and his government were “disconnected” from the real world, and their advisers needed to “shake the hands of a few who actually work”.
“People are angry to say the very least, especially young workers who believe their entire generation is being sacrificed”, Martinez said. “Mr Macron is so sure of himself, but he’s playing with fire. We’ve already had Le Pens – father and daughter – twice in the second round of a presidential election”. With most of France wary of outright against pension reform, Macron’s attempt to balance the pension budget may cost him at election time.
“We’re not the villainous little Gaulois the president says we are”, Martinez says. “We’ve been called militant and not reformist, but I dispute these labels. We are not against reform, we want it but not this reform. We believe we can improve the current system and have made many proposals, but this government doesn’t negotiate. We have a president who thinks he’s always right so it’s difficult to discuss anything. And when discussions don’t work, there are conflicts”.
Protest Predicaments
Macron’s plan to outlast protestors may work to his favour in the end, but repercussions have been felt across the nation. Walkouts at power plants reduced electricity generation by 6.4 percent, leaving demand outstripping capacity due to plummeting winter temperatures. At one point, union protests shut down France’s largest hydro-electric site, leaving France importing electricity from its neighbours to cope.
Because of the rise of violent clashes and power outages in residential areas, along with blocking ports and fuel facilities, the government has condemned protestors for “illegal actions”. Prime Minister Philippe has accused workers who disrupt critical infrastructure of “disrespecting democracy and the law”, while CGT’s Martinez has insisted that the government was “refusing to recognise the discontent”.
“Some who disagree with the government are encouraging violence. Like with the yellow vest protest, the far-left and far-right are regrouping for violent political action. This is extremely dangerous for democracy”, Coralie Dubost, an MP for Macron’s LREM party, said on BFM Television.
Martinez supports what the union calls “innovative actions” and what the government calls “sabotage”, though he did condemn recent CGT attacks on a rival union, the CFDT, whose offices were raided by CGT members after CFDT voted to call off their own strikes. “I have no problem when actions are targeted and in general we target big companies”, he said. “Strikes cause problems. When you have 50 days of protests with a government that is contemptuous of strikers, insults them, arrests them, holds them in custody, then obviously dialogue becomes more complicated”.
“Mr. Macron cannot have it both ways. He cannot invite business leaders to Versailles and vaunt the fact that France is the best country for foreign investment, then say France is always on strike”.
Protests have strongly impacted French businesses – especially in the capital – and even popular tourist destination, the Eiffel Tower, remains closed as employees take part in demonstrations. Hotel takings have been “catastrophic” according to the GNI, the French national association of independent hotel and restaurant professionals. The GNI has estimated that the drop in restaurant revenue alone stands between 10 and 25 percent – worth an estimated 220 million euros.
Hospitality and entertainment sectors have been particularly hard hit. One Parisian restaurant, Paquin’s, sits at the “golden triangle” of Bastille, Nation and République – where most of the city’s protests take place. The restaurant has been surrounded by cordoned-off streets, escalating protests, and police vans parked outside – none of which helps their bottom line. “We spend more time letting the CRS (police) in to take a piss and have a coffee than we do attending to clients”, said Rodolphe Paquin, the restaurant’s chef and owner. “Why would you come into the area? When you risk being hassled by angry protesters?”
While unions have been successful in mobilising their workers, despite suffering their own economic losses, their long hoped-for solidarity from private-sector workers has not come to pass. Nor has union membership held steady over the years, which means that despite the spectacle of these protests, these organisations are less powerful than they used to be. On top of that, backing off of raising the retirement age has divided union opinion, leaving only a portion to continue protesting while others return to work.
As the President continues to take a hard line with protestors, many believe that weaknesses within French unions may help to successfully push Macron’s long-sought reforms into law.
