The government's backpedaling on the pension freeze

Good news for retirees! During an interview on France 2, on November 12, 2024, the Minister of Budget and Public Accounts Laurent Saint-Martin confirmed the revaluation of retirement pensions which will be done in two stages in 2025.

A revaluation of pensions indexed to inflation

Originally, in October, Michel Barnier's government wanted to involve all retirees in the recovery of public accounts by freezing their benefits for six months.

The revaluation of pensions was to take place on July 1, 2025 and not January 1. The vast majority of political camps were against this measure. Preceded the day before by the Republican deputy Laurent Wauquiez, the minister confirmed the words of the former president of the region Auvergne-Rhône-Alpes.

All retirement pensions will be increased from January 1, 2025. At the start of the year, the increase will correspond to half of inflation. It is currently at 1.8%, which gives a 0.9% increase on pensions.

A second catch-up for low-income retirees announced in mid-2025

A second wave of readjustment is planned for July 1, with the same progression as that at the start of the year (0.9%), for retirees receiving the minimum wage or lessthat is to say until 1 426,67 € net per month. The government's goal is to avoid a loss of purchasing power among seniors.

This boost helps increase the purchasing power of retirees, a welcome help especially if loans have been taken out. Credits can in fact weigh on a budget, when the monthly payments of the various loans leave little room for the remainder of life.

In this case, it is for example possible to repurchase credits. Consolidating several loans into one, more suited to the borrower's current financial situation, makes it possible to reduce monthly repayment payments. This is possible thanks to the extension of the loan duration, which on the other hand increases the total cost of financing.

According to the Minister of the Budget, the cost of the revaluations varies depending on the reality of inflation: between 500 and 800 million euros. Thus, the government estimates that this choice will save approximately 3 billion euros in 2025, while protecting the smallest pensions.