The Hard Right in France Divided Over Pension Reform
Thought Britain’s debate over the future of the “triple lock” on state pensions was toxic? Ours is but a minor disagreement compared to the storm engulfing our cousins across La Manche.
When Emmanuel Macron tried to raise France’s retirement age in 2023, the country’s population – fond of a protest – did not take it lying down.
At 62 and nine months, the French can retire earlier than most of Europe. Yet more than a million demonstrators took to the streets nationwide, and 120 were arrested in Paris alone following clashes with police.
Three years later, the ferocious debate about whether the French should work longer has spilt over from the streets and is threatening to tear the ascendant nationalist Right apart.
On one side of the divide is Marine Le Pen, leader of the National Rally’s (RN) parliamentary party, who believes raising the retirement age is an “unbearable injustice” and wants it to sink as low as 60.
On the other side is her heir apparent, Jordan Bardella, the party president, who called the current system “economically unsustainable” as France’s finances creak under a €3.5tn (£2.99tn) debt. His officials are also believed to be outlining plans to force people to work for 42 years or face a reduction in their retirement benefits.
The potential split has added to the turmoil engulfing RN just nine months before a crucial presidential election, with officials still unclear on who the party’s candidate will be.
Le Pen, the incumbent option, is banned from running for office for the next five years after being convicted of embezzling EU funds, with the verdict on her appeal to be delivered on July 7. If she remains barred, she has anointed Mr Bardella – more popular among the electorate – as her successor.
Whoever emerges, RN’s presidential candidate will soon have to outline the party’s position on the national retirement age. Known as the third rail of French politics, however, the issue has exposed a divide between the two leaders.
Jean-Yves Camus, a leading expert on the French hard-Right, said: “I understand that Bardella is closer to the demands of MEDEF, the employers’ organisation, and is more in favour of a funded pension system.
“It’s much harder for Marine Le Pen to accept, given the generation she belongs to. When she was still only 10 or 12 years old, this pay-as-you-go pension model was seen as something that absolutely shouldn’t be changed.
An influential member of RN agreed that the retirement age was hanging over the party. Speaking anonymously to Le Monde, they said: “It’s the party’s explosive issue. There is internal paralysis, no briefing notes are circulating, but the matter will soon be settled. We’ll know on July 7.”
“These tensions [between the two] have simply existed for a long time, they’ve just become more apparent in recent days because July 7 is approaching.”
Good cop, bad cop
The pension issue is expected to be a major talking point in the upcoming presidential election after controversial reforms in 2023. France hands almost 15pc of its GDP to state pensioners and faced with a spiralling bill, Mr Macron passed a law to increase the retirement age from 62 to 64.
Amid a widespread revolt, both on the streets and in parliament, his government invoked a constitutional clause to sidestep a vote among MPs.
The government narrowly survived a subsequent no-confidence vote. Although the pension age had finally started rising, Sébastien Lecornu, France’s prime minister, was eventually forced to postpone further changes until after the upcoming election.
Before the election, RN has not yet revealed its hand, but many believe that its two leaders are beginning to split on the issue.
Le Pen has said she will return the retirement age to 62, or 60 for those who started work before the age of 20, in what she believes is an “economically sound and efficient reform”.
Mr Bardella, however, has been lukewarm about the idea and described the current system as “not economically sustainable” in a May interview.
According to Politico, his officials are also working on a plan to scrap the rule that entitles French workers to a full pension at 67, regardless of how much they have paid in. Instead, workers would have to choose between a lower pension or waiting until they have contributed for 42 years.
Alex Everett, of investment firm Aberdeen, said: “Pensions have long been the lightening rod for French politics, and it’s something that was clearly the cause of some disruption in recent years.
“Indications suggest [the leaders’] priorities differ, but some of this may be laying out their stall ahead of any policy decisions.
“Bardella’s changes could be well-received, but even floating them could yet cause more political turbulence. It’s interesting for it to come up as a topic of discussions with RN, which has traditionally been in the camp where changes were not on the table.”
Some analysts see Le Pen’s position as a populist attempt to retain the party’s working-class base, while Mr Bardella’s is thought to be an attempt to drive up RN’s economic credibility. It could hardly be more topical.
According to the National Institute of Statistics and Economic Studies (INSEE) – France’s equivalent of Britain’s Office for National Statistics – the national debt was already €3.5tn at the end of March, equivalent to 118pc of GDP.
Seismic impact
Outside election campaign circles, however, there is some doubt about whether changing the retirement age would make much difference to France’s finances or its retirees.
According to official government figures, Mr Macron’s reforms would only have saved the equivalent of 0.1pc of France’s debt during two years.
INSEE also found that pensioners’ incomes per person have been broadly the same as those of the working population since the 2000s and that an increased retirement age would only reduce them to between 76pc and 87pc by 2070.
“In reality, the amount of money they’re going to save is a drop in the ocean. There are much more fundamental things they have to do to bring the deficit under control.”
As the debate rumbles on, France’s Right is anxiously awaiting the judge’s verdict on July 7.
With many viewing the 2027 election as RN’s best chance of victory, the decision could have a seismic effect on the fabric of French politics.
Andrzej Szczepaniak, a European economist at financial services firm Nomura, said: “The [retirement age] change from 62 to 64 won’t actually impact France’s fiscal situation that much.
It’s still unclear who the candidate will be, but there is no doubt that the incendiary issue of pensions can’t be put off much longer.