An attack on the solidarity-based system
One must be absolutely modern.
No hymns! Hold the ground gained. Arduous night!
~ Arthur Rimbaud, “A Season in Hell”
In France, the pension regime associated with social security dates from the Liberation of Paris and was set up under the leadership of Ambroise Croizat, former Minister of Labour and trade unionist with the Confédération Générale du Travail (CGT), and based around the objectives of progress, solidarity, democracy and social transformation. Back then, the trade unions representing salaried workers were in charge of social security, and their sole aim was to improve labour rights in order to meet people's needs in areas of health, family and retirement. This project represented, without a doubt, the most important social victory of the 20th century in France.
It is this social model that has enabled France to occupy an almost unique position in the world with regard to pensions. Over the past 60 years, the life expectancy of men and women has risen by an average of 14 years. Pensioners’ average income relative to that of active workers is among the highest in the world, while the pensioner poverty rate is among the lowest. But for all of that, since the pension reforms of 1993, 2003 and 2010, which postponed the age of retirement to well beyond 62, retirees’ expectancy of a life in good health has been declining, despite advances in medicine.
A series of neoliberal reforms has exacerbated inequalities. Today, the richest 5% of people in France can expect to live 13 years longer than the poorest 5%. The life expectancy of a 35-year-old male worker is 6 years lower than that of a manager, and that of a 35-year-old female worker is 3 years lower than that of her manager counterpart.
Macron's project of dismantlement
Now the government wants to impose new social regression, under the guise of its planned “universal” points-based pension system, which would entail scrapping the entire current regime. The objective is budget-related: to lower the proportion of GDP (13.8%) devoted to pensions. To achieve this, pension levels must be lowered more quickly, by about 20-30%, and the effective retirement age raised to 64 or 65.
The first decision involves calculating the pension level, which would now be based on the salaries earned over an entire career, no longer on the best 25 years (in the private sector) or the last six months (in the public sector). This new method of calculation will lead to a significant drop in pensions and will exacerbate inequalities, particularly for people who, during periods of precarity or involuntary part-time work, earned lower pay rates that will bring down their overall average salary. Unsurprisingly, this reform is even harder on women, whose pensions are already 20% lower on average than those of men.
The second decision is to backtrack on all measures designed to reduce inequalities by taking into account professional and career-related specificities. To understand the implications, one must only consider that, as of today, 15 million of France's 16 million pensioners benefit from at least one solidarity measure (taking into consideration their number of children, widowhood, adjustment for very low wages and periods of unemployment, etc.).
A points-based scheme would mark the end of the solidarity pension system, meaning that all the vicissitudes of working or family life would negatively impact retirement, without being mitigated by national solidarity. For example, whereas periods of sickness, disability or unemployment are currently still included in pension calculations (“awarded but with no contributions”), if the reform is adopted, workers would lose any so-called “gap days”. A 30-day gap will be calculated for sick leave. People who are not in good health will be doubly penalised!
The so-called “universal” points-based scheme will mean the disappearance of the 42 current basic and complementary pension schemes that take account of all professional specificities and compensate for the inequalities or particular constraints of various professions. Take, for example, the situation of workers highly exposed to chemical hazards or industrial accidents, as well as night or irregular (morning, evening, night) shift workers, who have a shorter life expectancy. Macron's plan would do away with early-retirement mechanisms for many workers doing arduous jobs.
Finally, the last major consequence of this reform is that the value of the “points” would be subject to political, economic and demographic vagaries. Only the government would be able to set the value, depending on its budgetary or political objectives.
The planned reform, which would dismantle France's current pension system, conceals a broader political project, namely privatisation and the establishment of funded pension schemes, meaning most would be left up to private insurers. This liberal model establishes a mechanism for retirement viewed purely from the managerial and accounting perspective. The points acquired during working life would not guarantee a sufficiently high pension, inducing those workers who can afford it to take out private insurance, while condemning the rest to poverty.
The CGT's solidarity-based alternative
The Confédération Générale du Travail believes that the solidarity-based foundations of the social security system must be defended. Our net salary may cover our living costs at the end of the month, but it is our gross salary that determines our means throughout life and guarantees us access to health care, family rights and a pension. In a society in which inequalities continue to increase sharply, the great principle “From each according to their ability, to each according to their needs” – which includes everyone in a shared destiny and has enabled so much progress for the working classes – is as relevant as ever.
In truth, the CGT’s plan is rather to continue developing the social security system, expanding everyone's rights and taking account of new problems arising in our time.
The CGT puts forward proposals based on meeting the needs of the entire population, including a retirement age of 60, a pension of at least 75% of net professional income and no pension less than €1,200 net (roughly equivalent to the current minimum wage).
For young people, the CGT wants their years of study and training and the time they spend looking for their first job to be included in the reckoning, because training and qualifications contribute to wealth creation and make companies more competitive, so it is only fair that their pensions should reflect this.
The CGT is calling for recognition of the strains and stresses of work and the extension of early retirement to 55 years for everyone subjected to arduous working conditions. For example, all nurses and careworkers do tough jobs, so they should be allowed to retire on a full pension at the age of 55.
To achieve this, it will be necessary to raise more money from social security contributions. The best way to do this is to increase wages! For example, awarding women and men equal pay would bring in an additional €6.5 billion for pensions. More social justice, including the removal of employers’ exemptions from paying social security contributions, would net an additional €20 billion to finance pensions.
Social security and solidarity, or private insurance and individualism: this the stark choice today facing the French people. Sorting out pensions is crucial for defining the future of our society. Strong popular mobilisation is the only way of bringing the Macronist machine to a halt. Naturally, the CGT will play its part in this struggle.
Catherine Perret is Confederal Secretary of France's General Confederation of Labour (CGT) and its lead negotiator in the pension reform. She is also a member of the Board of Directors of the National Agency for Adult Vocational Training (AFPA).