French pensions reform won’t plug deficit: report

The controversial pensions reform that French President Emmanuel Macron forced through parliament in March will not close the pensions deficit as predicted by the government, France’s pensions watchdog found in a report.

Macron signed the pensions reform into law in April despite huge country-wide protests of a historic scale. It effectively increased the legal retirement age from 62 to 64 to save up to €17 billion and close a pensions system’s deficit the government said would only grow as the French population ages.

However, despite the government’s predictions, the French pension system will “remain in long-term deficit” even if the reform is expected to help somewhat, the pensions watchdog’s new report to be published on Thursday reads.

While the government hoped to break even by 2030, the pensions watchdog found that there would still be €5-8 billion deficit beyond that date, dashing the government’s hopes to regain control over public spending.

In May, the French government highlighted the pensions reform as an indispensable condition to guarantee the “sustainability of our public finances” and achieve full employment by 2027.

The Commission called the French pension system “complex” and particularly costly and criticised France for having a legal retirement age much lower than the European average.

(Theo Bourgery-Gonse | EURACTIV.fr)