France will raise age for retiring
Source: Agencies |
June 17, 2010, Thursday
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FRANCE will raise the retirement age from 60 to 62 in 2018 in an effort to get the country's spiraling public finances under control, the labor minister said yesterday.
Eric Woerth called the measure - already strongly opposed by the opposition Socialist Party and labor unions - a "real moral obligation," given France's burgeoning deficit and its aging population, which he said threatens the viability of the money-losing pension system.
The French budget deficit was at 7.5 percent of gross domestic product last year. The conservative government has vowed to bring it under 3 percent - the threshold set by the European Union - by 2013. The Greek crisis has given added urgency to France's plans to cut back.
Woerth said the reform will bring France more into line with other European countries, which have raised retirement ages and taken other measures to slash budget deficits.
Still, the French measure pales in comparison with more drastic changes elsewhere in Europe. Germany, for example, is to gradually raise its retirement age from 65 to 67, starting in 2012 and wrapping up in 2029.
"There is no magic in terms of pensions. We cannot at the same time promise to work less long and not have a deficit," Woerth told journalists. "If we want end our pension system's debts, working longer is unavoidable."
The reform will save nearly 19 billion euros (US$29.3 billion) in 2018 and should bring the pension system back into the black that year, he said.
He pledged the measure will be "responsible and fair," affecting workers in the public and private sectors equally. It also makes exceptions for people who had physically tough jobs that took a toll on their health, as well as people who began working young, before age 18. They can still retire at 60.
Several unions said that aspect of the reform will unfairly penalize women, who often spend more time out of the work force raising their children.
Eric Woerth called the measure - already strongly opposed by the opposition Socialist Party and labor unions - a "real moral obligation," given France's burgeoning deficit and its aging population, which he said threatens the viability of the money-losing pension system.
The French budget deficit was at 7.5 percent of gross domestic product last year. The conservative government has vowed to bring it under 3 percent - the threshold set by the European Union - by 2013. The Greek crisis has given added urgency to France's plans to cut back.
Woerth said the reform will bring France more into line with other European countries, which have raised retirement ages and taken other measures to slash budget deficits.
Still, the French measure pales in comparison with more drastic changes elsewhere in Europe. Germany, for example, is to gradually raise its retirement age from 65 to 67, starting in 2012 and wrapping up in 2029.
"There is no magic in terms of pensions. We cannot at the same time promise to work less long and not have a deficit," Woerth told journalists. "If we want end our pension system's debts, working longer is unavoidable."
The reform will save nearly 19 billion euros (US$29.3 billion) in 2018 and should bring the pension system back into the black that year, he said.
He pledged the measure will be "responsible and fair," affecting workers in the public and private sectors equally. It also makes exceptions for people who had physically tough jobs that took a toll on their health, as well as people who began working young, before age 18. They can still retire at 60.
Several unions said that aspect of the reform will unfairly penalize women, who often spend more time out of the work force raising their children.
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