Retire later, longer contribution periods for full benefits – the French government wants to present the details of its planned pension reform on Tuesday evening.

The project has been eagerly awaited for months and was a key campaign promise by President Emmanuel Macron.

The schedule is sporty: The plan is to go through the cabinet the week after next, then to parliament and come into force at the end of the summer.

Niklas Zaboji

Economic correspondent in Paris

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A central point is the increase in the statutory retirement age from the current 62 to 64 or 65 years – ie to a level that has long been common in Germany and many other industrialized countries.

The increase is to be gradual, and in all probability the government wants to move the limit back by three months every year.

Another key point is the faster increase in the contribution period from 41.5 to 43 years, which one must have paid into the pension funds for full benefits - faster than the last reform launched under Macron's predecessor François Hollande.

With it, the contribution period increases by three months every three years.

The French government justifies the need for reform with demographic change and the threat of billions in deficits in the pension funds, which are financed on a pay-as-you-go basis, as in Germany.

While around four employees financed one retiree in the 1980s, the ratio has fallen to almost two to one due to declining birth rates and longer life expectancies.

Three adjustment screws possible

"We have to work more," said President Macron in his New Year's speech, emphasizing that he wanted to consolidate the system and hand over a "fair and solid social model" to future generations.

His warning of an imbalance in the pension funds did not come out of the blue.

The government relies on calculations by the 41-strong Council of Experts, the Conseil d'Orientation des Retraites, which includes economists and parliamentarians as well as social partners and trade union representatives.

The committee did not make any explicit political recommendations and did not see the continued existence of the pension system in jeopardy.

However, it unequivocally predicted a deterioration in the cash position and a deficit over the next 25 years.

The current surpluses of 900 million euros in 2021 and an estimated more than 3 billion euros last year are therefore unlikely to continue - even if unemployment continues to fall and productivity increases.

Three adjustment screws could therefore be adjusted to ensure balanced funds: the salary, which is politically too sensitive to reduce, the contribution rates, which increased the non-wage labor costs, or the retirement age and contribution period.

There is no question of radically simplifying the complicated French pension system, which has around 40 funds, and introducing a points system.

In this respect, the new plans differ from the reform plans planned during Macron's first term in office and buried with the outbreak of the corona pandemic, which brought hundreds of thousands of demonstrators to the streets at the time.

Higher minimum pension

Conflicts are programmed this time too: the employee representatives unanimously reject raising the retirement age and have again announced major protests.

"We will do everything we can to get the government to withdraw," said Laurent Berger, head of the CFDT union, which is well known as a more moderate union, with a view to the planned retirement age of 64 or 65. His proposed solution is: employer pension contributions up and more older people People as contributors in employment.

That would flush the necessary billions into the coffers to avert a structural deficit.

Resistance also comes from Parliament.

It is still unclear whether the government will be able to win over opposition parties such as the conservative Republicans in the National Assembly, where it has been without a majority for several months.

And the French themselves didn't fare too well with the reform project either.

In the most recent survey by the Odoxa and Agipi institutes, 74 percent of those questioned were in favor of keeping the pension at 62.

Only 26 percent voted for raising the entry age to 63, 16 percent for 64 and just 13 percent for 65.