Balance age, calendar, special plans … Edouard Philippe’s announcements on pension reform


Balance age, calendar, special plans ... Edouard Philippe's announcements on pension reform

This December 11, the Prime Minister detailed the architecture of the pension reform, during an address to the Economic, Social and Environmental Council. Here is a summary of his announcements.

A much awaited speech. This December 11, Edouard Philippe presented the details of the pension reform carried out by his government. A declaration which comes on the seventh day of a national strike movement against this reform.

The Prime Minister had to answer many questions that still arise about the new system. Will special diets disappear? What deadline? How will the transition be organized? How will hardship be taken into account? Will there be a pivotal age or a “balance age”?

Find her full video speech below

“This reform is not a battle. I do not want, in France today, to enter into the logic of the balance of power. I do not want this warlike rhetoric”, assures the opening Prime Minister. “I hear the concerns that have been expressed for several days. The ambition of universality carried by the government is an ambition of social justice. There is no hidden agenda. We do not want to hurt anyone. We want protect the purchasing power of workers and retirees.”

“We are not stigmatizing anyone. There will be neither winners nor losers. We want the French to come together around the three principles of universality, equity and responsibility that underpin this reform”.

A principle of universality. “The system will be the same for all French people without exception instead of being organized according to the logic of statutes”. “All French people will have” the same level of contribution “on” all income up to 120,000 euros “.” Beyond this amount, the wealthiest will pay a solidarity contribution (2.8%) higher than today”.

We will move from a system of paid quarters to a point system. The value of the point will be fixed by the social partners, under the supervision of the Parliament. “The law will provide a golden rule so that the value of the points acquired cannot fall. Indexation will be done not on prices, but on wages,” said the Prime Minister.

End of special diets. “The 42 existing schemes will be abolished,” confirms Edouard Philippe. “We will do it gradually, without brutality, respecting individual routes”.

“Restore equity and social justice”. “Let us not ignore the injustices that have been tolerated for too long.” High unemployment, developed part-time, fragmented careers … “We must take better account of the new faces of precariousness”, judges the Prime Minister. 

A minimum pension of 1,000 euros net per month will be guaranteed for a full career at Smic (85% of Smic over time). “Women will be the big winners of the universal system,” says Edouard Philippe. “Additional points will be awarded for each child, from the first child (5%)”. 2% additional points will be awarded to parents of three or more children.

An “age of balance”. “We will maintain the minimum retirement age at 62 years. The legal age will not change. But we will have to encourage the French to work longer. We will establish a balance age with a bonus / penalty system. We will extend and improve the consideration of arduousness with criteria common to all “. “Those who started working before the age of 20 will be able to leave two years before the others.”

The equilibrium age of 64 will be reached in 2027, gradually.

Transition to the new system.  “We must avoid the pitfall of precipitation like that of procrastination,” suggests Edouard Philippe. “Those who will enter the labor market for the first time in 2022 (the 2004 generation) will directly integrate the new system”.

Nothing will change for people born before 1975. The first generation affected by the reform (the 75 generation) who will retire in 2037 will have 70% of their retirement calculated according to the old system.

Special cases. “A universal system does not mean the negation of all specificity,” said the Prime Minister. Military personnel, firefighters, police officers … “Those exposed to dangerous missions within the framework of royal missions will keep the benefit of age exemptions”. Specific measures, in particular salary increases, are planned for teachers.

Law introduced in January. The bill will be ready by the end of the year, will be presented to the Council of Ministers on January 22, and debated in Parliament in February. On January 1, 2022, the new rights will be implemented. In 2025, the generations with more than 17 years of retirement will integrate the new system while retaining the rights acquired in the old system.