Tuesday 16 January 2018

Frances wants EU to resist pushing up retirement age

Mark John

France is pushing for this week's European Union summit to bury a suggestion by the bloc's executive arm that it raise its statutory retirement age from 62, French sources said today.

This is the latest in a series of tussles between France and the European Commission. Paris has already accused Brussels of trying to dictate reforms, and it has also blocked EU efforts to include film and other cultural goods in talks on an EU-U.S. trade pact.

French officials promise they will push ahead with pension and other reforms as agreed with the EU in return for more time to cut their public deficit. But they say they must be allowed to do it their way to avert the risk of strikes and protests.

"We had the feeling it (the Commission) was telling us what to do," said a diplomatic source in Hollande's office.

"We have asked that there be no talk of raising the statutory retirement age because that is not what the government wants," the source said.

The Commission on May 29 gave France specific suggestions for reforms of its debt-laden pension system this year, such as adapting indexation rules or raising the legal retirement age.

Pension reform is an explosive issue in France. Hollande's conservative predecessor Nicolas Sarkozy brought hundreds of thousands of French out onto the streets in 2010 with his move to raise the retirement age from 60 to 62.

Hollande, keen to avoid such unrest, has ruled out any more increases in the legal retirement age. Instead he suggests a small rise in the number of years a worker must pay contributions to receive a full pension, currently averaging 41.5 years.

France scored a partial victory last week when EU finance ministers meeting in Luxembourg watered down the Commission's proposals, amending them to suggest an increase only in the "effective retirement age".

That is a wording more compatible with Hollande's approach, which would automatically increase the average age at which the French would retire by obliging them to contribute longer.

However the latest draft of the text includes a reference elsewhere to "further increasing both the minimum and the full-pension retirement ages," which could still be taken as referring to the statutory age.

"It's still in discussion," a second French source said of pre-summit negotiations on the wording.

However a senior EU official said he expected the summit, which meets until Friday, to back the Luxembourg compromise.

"We are aware that France and several other countries are not happy about the language of the recommendations but it will be endorsed as it is," the official said.

"We are not expecting widespread discussion on this at the summit," he said of the talks, which are instead due to focus on tackling youth unemployment.

Trade unions and employer groups will discuss reform options in July, and Hollande's government has promised to study their conclusions before offering legislation around late-September.

France also wants the final recommendations to include a reference to the role of unions and employers in helping to shape the reform, the French diplomat said.

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