Monday, June 5, 2023

French court approves pension age rise as nationwide protests rage on

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Riot police guard the Constitutional Council building during a demonstration against pension reform in central Paris, France, on Thursday, April 13, 2023. French unions are held strikes and protests on Thursday against President Emmanuel Macron’s pension reform, seeking to maintain pressure on the government before a ruling on the law’s constitutionality.

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France’s Constitutional Council on Friday approved President Emmanuel Macron‘s controversial raising of the retirement age, as nationwide protests rumbled on.

The council passed the core of the pension reforms, including the increase in the retirement age for most workers from 62 to 64, but removed six additional provisions as had been expected.

It also rejected a bid to hold a citizens’ referendum on the changes.

Macron’s unpopular plan to raise France’s retirement age was enacted into law Saturday. The president’s signature and publication in the Official Journal of the French Republic allowed the law to enter into force.

The authorized changes will start being implemented in September, French government spokesperson Olivier Veran said.

Long traffic jams formed in cities including Marseille on Friday as crowds gathered around the country to hear the court decision. Protesters made their way into the headquarters of luxury goods giant LVMH and lit smoke flares on Thursday — the same day the company’s share price reached a fresh record high, following the release of its first-quarter results.

A procession of students shouting opposition slogans with a sign reading ”Macron guillotine? Yes maybe” during a demonstration where for the twelfth time in 3 months, several thousand people, employees and students, demonstrated in the streets of Paris.

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“The Constitutional Council decision shows that it is more attentive to the needs of the presidential monarchy than to those of the sovereign people. The fight continues and must gather its forces,” said Jean-Luc Melenchon, leader of the leftist La France Insoumise party, according to a Reuters translation.

Far-right politician Marine Le Pen, who also opposes the reforms, said, “The people always have the last word, it is the people’s right to prepare for the change in power that will be the result of this unnecessary and unjust reform.” Analysts have said the pensions saga may provide a boost to Le Pen’s National Rally party.

Ahead of the decision, Macron said he would seek to meet with unions, which expressed their anger throughout the day.

“Given the massive [public] rejection of this reform, the unions request him solemnly to not promulgate this law, the only way to calm the anger which is being expressed in the country,” trade unions said in a joint statement reported by Agence France-Presse.

Macron and French Finance Minister Bruno Le Maire argue that the reforms are fiscally necessary to secure the costly pension system into the future.

Opponents argue that the changes mark a political decision that disproportionally impacts lower-paid workers and women, while companies report bumper profits.

In an interview with French TV stations last month, Macron insisted that the moves were necessary, but acknowledged that people felt a “sense of injustice” and said he would look to make businesses contribute more.

Demonstrators march along the vieux port during the 12th day of nationwide strike on pension reform on April 13, 2023 in Marseille, France.

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The French president has faced a huge uphill political battle to get the pension changes, which he has advocated for years. His popularity has plummeted, and widespread strikes and protests that have involved clashes with police have been staged since the start of the year.

Borne used a special constitutional measure to pass the changes without a parliamentary majority because of the large number of opposing politicians. The process involved triggering Article 49.3 of the French Constitution to amend the social security budget. The government then narrowly survived a no-confidence vote.

The appeal to the Constitutional Council was based on three points concerning the information that was provided to lawmakers, the suitability of the procedure and whether the bill fills the budgetary scope, Le Monde reported.

An outright rejection was considered unlikely because the move has precedent, but the council was expected to remove more minor provisions, such as a requirement for large companies to publish annual reports on how many workers they employ who are aged 55 and over.

Ahead of the announcement, Renaud Foucart, senior lecturer in economics at Lancaster University, told CNBC that a partial approval was likely the best outcome for Macron. “He can then sit down with unions and say we can negotiate some sort of new additions or reforms with a more social focus,” Foucart said.

Demonstrations are likely to continue.

“Tonight, Paris will burn,” Foucart said. “But the decision today is likely to provide a chance for Macron to try to change the subject.”

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Foucart noted that, while the nine-member council is France’s top constitutional authority, it is not akin to a supreme court in other countries and mainly comprises former politicians elected to serve nine-year terms, rather than lawyers.

Opinion polls have suggested roughly two-thirds of people supported strikes to oppose the measures.

Christiane Denis, a 57-year-old living in outer Paris, said she was against raising the pension age to 64 because some jobs were difficult at that age and it would most impact those who start work early.

But it does have some support.

“Given the increased life expectancy, in a few years there will be too many retirees and if nothing is done today, then everyone’s pensions will be greatly reduced,” Christophe David, a 49-year-old quality control inspector, said. “Even if it does not suit me, we have no choice but to take this directive.”

Associated Press contributed to this report.

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