What are the protests over Emmanuel Macron’s pension reforms in France?

The Place de la Concorde in Paris saw a heated clash between the protestors and police recently on Friday. The reason behind the clash lies in the government’s decision to alter the state pension age. As per the new change, the state pension age has been changed from 62 to 64. This implies that people would require to work longer in order to get a full state pension.

Earlier, the protests had been mild and peaceful. Demonstrations occurring throughout the nations had been fighting against the new change in a fairly peaceful manner since the start of the year. However, recently the peaceful protests turned into a full-fledged riot on March 16, soon after President Emmanuel Macron’s administration made use of a special provision in the Constitution to push through the pension reform sans holding a vote in the National Assembly. It is important to note that Emmanuel Macron’s administration does not hold a majority in the National Assembly. During the protest, the Opposition politicians sang the French National Anthem and held protest signs in the Parliament.

The New Pension Reform

Everyone gets a state pension after retirement in France. How is this pension funded? Well, compulsory payroll taxes paid by the people working currently in different sectors is what funds the retirement pension. This provides for an assured, state-backed pension.

However, the government wants to modify the state pension provision a bit. The state is of the view that life expectancy in France is increasing. This implies that in the coming time, there will be more aging population in France, even more than new entrants in the workforce. This would mean that the current pension system will fall short in the upcoming decades.

As per the estimation by the administration, in the year 2000, there were 2.1 workers putting funds into the system for every one retiree, the number declined to 1.7 workers per retiree in the year 2020. Moreover, a further drop to 1.2 by the year 2070 is expected. As per the government, the measure to increase the legal retirement age gradually by three months until it touches 64 by the year 2030 is actually "indispensable" to balance out the pension system while also not compromising its financial viability. 

The special provision 49:3 of the Constitution had been decided to use as a last-minute call. On this, the Prime Minister of France, Elizabeth Borne expressed: "We cannot gamble on the future of our pensions. That reform is necessary."

What does this new change mean?

The new pension reform increases the retirement age from 62 to 64. This implies that the people of France will have to pay payroll taxes for a few years more than usual. In simple terms, it means that people will now require to work longer. The changed pension scheme also means that there will be a phased increase of three months every year till the year 2030. Suppose a person is born in 1961 and is due to retire in 2023. Now, due to the new pension reform, this person will have to work for an extra 3 months to get the state pension.