The Prime Minister announced, during his general policy declaration, that he was choosing to postpone the pension reform “under construction with social partners”. “The real debate must be brought back to annuities, small pensions and arduousness. So, I say that it is entirely possible to find an agreement on these terms”insists, Wednesday January 15, Jean-Hervé Lorenzi, economist, founder of the Circle of Economists.
Neither repeal nor suspension, but a negotiation placed in the hands of employers and unions who have three months to agree. “A good method”according to Jean-Hervé Lorenzi. If the social partners manage to find an agreement, it will be taken up by Parliament during the next Social Security financing bill this fall. If negotiations fail, the current text will continue to apply. And the Prime Minister opens a third way and promises to submit a new bill in the event of “progress” between the social partners, even “without general agreement”.
franceinfo: Retirement pensions cost 340 billion euros each year, or 14% of GDP. First, on the method used, is François Bayrou right to first want to objectify the figures, starting with those of the deficit, a mission that he will entrust to the Court of Auditors? Is this a prerequisite, in your opinion, for any discussion?
It's not a prerequisite, it's just a smart measure. Having the guardians of our country's accounts speaking out about our country's accounts is not absurd.
There are debates about the figures: the Prime Minister speaks of 55 billion in debt, the Pension Orientation Council (COR) estimates it more at 15 billion in 2030.
At the chair that I have the honor of leading, we have done the calculations, we arrive, if we do not move anything, in the current system, we arrive at around twenty billion euros of additional deficits in 2030 . Obviously we have to move.
Can we honestly say that it is possible to finance our pay-as-you-go retirement system without increasing the deficit and giving up retirement at 64? This is the challenge of the negotiations which will open for three months with the social partners.
First of all, I think the method is good. Between us, who knows the subject better than the social partners? With the argument which consists of saying “they will never agree”, France would be paralyzed. It’s La France insoumise which says that. But at that moment, it's an argument from authority: it's not possible, no one can argue anymore. It's a good method, it's quick, it doesn't change the face of the world and I think it's quite clever even compared to suspension. It was difficult to swallow for part of the majority, it is a complicated political situation. And it's quite clever since in reality, there will not be hundreds of thousands of people who will be affected by these pension changes during these three months.
“Basically, it was the right trick for both the Court of Auditors and both the social partners.”
Jean-Hervé Lorenzion franceinfo
Do you think it is possible to find an agreement without undermining the current pension system and renouncing the age measurement, which is still the flagship measure of Elisabeth Borne's 2023 reform?
There is something that has disappeared in the discussion, it is what we call annuities. You know that our pensions are linked to two figures: age, on which we are completely focused, and annuities. Annuities are the last reform that took place, which was made by the socialists. The Touraine reform which leads to 43 years in 2027. I just remind you that 43 years, if you start your job at 21, that's 64 years. So, it is actually much more important and above all much fairer. Quite simply because there are young people who start working at 15 or 16 years old and there are some who start working at 25 years old and we consider that the age measurement is common to everyone. No, that's not fair. You tell me, can we get out of this? Of course yes.
It's not that simple, a lot of people say that it's very complicated not to increase the deficit by stopping, like today, at 62 years and six months.
I don't agree. Consider that you put the same figure for everyone: you, like me, who started quite late and the young person who started at 15, who was an apprentice pastry chef… The real debate must be brought back to annuities and it must be brought back to small pensions and hardship. So, I say that it is entirely possible to find an agreement on these terms.
-What are the tracks? Two days ago, in your place, there was François Asselin, who represents small and medium-sized businesses. For him, there is no question that this will result in increases in contributions and therefore in an increase in labor costs.
We can imagine a lot of things.
“Treating retirees as if they were a single entity is completely inaccurate and not serious.”
Jean-Hervé Lorenzion franceinfo
If I am retired, I have a very decent retirement whereas there are women in particular who have had broken careers. That's the first subject. I have an idea that I submit to you, it is the minimum old age. Today, a woman with a very low pension can only receive a minimum retirement pension of around 1,000 euros, which allows her to survive, until she is 65 years old. I am reducing this minimum age from 65 to 60, which allows us to resolve a lot of issues.
So that is a measure of social justice. Have you submitted it to the government, what does it think?
I hope he thinks well of it.
It costs money, we come back to the question of financing: how do you finance these measures?
It has also not escaped you that, on average, while there are very small pensions and very comfortable pensions, the average is almost, in terms of income, roughly equivalent to that of working people or slightly higher.
So, you agree with Gilbert Cet, who is at the head of the Pension Orientation Council, who is for the removal of the 10% tax reduction to which retirees are entitled. He says it will save 4 billion euros per year, do you agree?
Not only do I agree, but I commend Gilbert Cet for coming up with this idea that we had at the same time. Obviously, it's a lead. Always separating the small pensions that we don't touch, which was the mistake of not highlighting this problem at the time of Barnier, and then the people who live completely comfortably, who are 75% owners of their accommodation and who can at the same time see this reduction disappear, which is absolutely senseless since it is for professional expenses, therefore which makes no sense. And second aspect, the CSG which is specific, which we can trace.
Normally, all films of the genre Mission impossible end well, according to Yvan Ricordeau, the negotiator of France's leading union, the CFDT. Do you agree? Do you think this negotiation will end well and that they will reach an agreement?
I think it will end well. I remind you that the CFDT agreed on the reform by points, the first merit of which was to eliminate the legal retirement age. So if we concentrate everything on these 64, 62 years, we can return to things which are fairer, which take into account small pensions and which in reality do not cost more. It's clear that we're going to work a little more, but you don't need to be a Nobel Prize winner in economics to know that.