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Delays in France’s Pension Reform to Focus on Post-Pandemic Economic Recovery

July 17, 2020, 08.00 PM

PARIS, KOMPAS.com – France’s pension reform has been postponed until 2021 in order for the country to focus on its economic recovery following the coronavirus pandemic.

French Prime Minister Jean Castex told labor and employers unions of the reform delays on Friday.

“The Prime Minister proposes to postpone consultations on this reform”, leader of the union for small and medium-sized enterprises CPME Francois Asselin said.

Castex also told unions that the full implementation of the unemployment insurance reform would be postponed to Jan. 1, 2021.

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France’s pension reform is between the government and the country’s unions.

The wake of the coronavirus pandemic in France in February halted all measures related to President Emmanuel Macron’s ambitious pension reform plans.

Macron’s push is the single greatest revamp of the pension system since World War Two.

Response from the country’s unions was anything but welcoming as thousands took to the streets to protest at the turn of the year.

Delaying its pension reform is in part to cool down tensions as France grapples with the economic fallout from the coronavirus pandemic.

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"The priority now is the battle against the crisis, for employment and to tackle unemployment," Castex told reporters after his first meeting with union representatives since becoming prime minister this month.

Castex said the reform, which includes raising the retirement age by two years to 64, would not be scrapped.

A deferment until after the 2022 presidential elections might defuse union and voter concerns but would undermine Macron's already-weakened credibility as a reformer.

The reform is central to Macron's ambition of creating a more flexible and competitive labor force. But trade unions who argue that it will erode hard-earned benefits and leave pensioners worse off. 

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