“I undertake to increase the amount of their retirement pensions by indexing it to inflation” » Les Souligneurs

Guest of the 20 hours of France 2, Saturday June 15, the Prime Minister, Gabriel Attal committed to “revalue pensions by the amount of inflation”. He then supports his point on X by stating “ I undertake to increase the amount of their retirement pensions by indexing it to inflation “. But this is already what the Social Security code provides.

Distinguish between basic pensions and supplementary pensions

We must first distinguish between the basic pension and the supplementary pension. When a private sector employee retires, their rights acquired throughout their professional career are paid back in the form of a pension. He perceives :

— A basic pension paid by the Retirement Insurance of the general Social Security system. This pension is calculated based on the average salary of the best 25 years and the number of validated quarters. It represents a maximum of 50% of this average salary.

— A supplementary pension paid by Agirc-Arrco, concerning the sectors of industry, commerce, services and agriculture. It is a points-based pension scheme which supplements the basic pension. Contributions are converted into retirement points: upon retirement, the points are converted into a retirement pension (1 point is worth €1.4159 since November 1, 2023). For a worker whose salary was 2000 euros net (2600 gross), the amount of their supplementary pension will be a little less 400 euros per month.

For public officials, the system is simpler. The pension is equivalent to 75% of the remuneration of the last six months (last index salary) with reductions if quarters are missed. There is indeed a supplementary pension called additional civil service pension (RAFP), but it only concerns bonuses and allowances, benefits in kind, etc., received during the career. It therefore does not have the importance of supplementary pensions for private sector employees. For contractual agents, there is also a specific supplementary pension called IRCANTEC with a low amount.

The automatic revaluation of basic pensions already exists in the law

According to article L.161-25 of the Social Security Code, a revaluation of basic pensions is planned each year: it is calculated on the average of consumer prices, excluding tobacco, calculated on the last twelve monthly indices by INSEE. If this average is less than 1, the increase will be 1%. If prices fall, pensions will be maintained.
This indexation is nothing new: it was introduced for the retirement of private sector employees, 31 years ago, by the Balladur reform of 1993, and extended to civil servants’ pensions in 2014. It therefore applies to all basic pensions, including civil servant schemes.

Supplementary private pensions: social partners decide

Supplementary pensions do not depend on this automatic mechanism. Every four years, the social partners redefine by collective agreement the strategic orientations of the AGIRC-ARRCO supplementary pension plan, and in particular the way in which the revaluation takes place.

In the period 2019-2022, a negotiation between the social partners (unions and employers) provided for an increase mechanism applied on November 1. In November 2021, supplementary pensions were increased by 1%, then by 5.12% in November 2022.

A National Interprofessional Agreement of October 5, 2023 determined new strategic directions for the period 2023-2026, and in particular a 4.9% increase in supplementary pensions in November 2023. This agreement also provides that, each year until 2026, the value of the point will change on November 1 as consumer prices, excluding tobacco, estimated for the current year, less a sustainability factor of 0.40 point. If the price index increases by 3%, the increase in supplementary pensions will be 2.6%.

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