What makes Macron’s pension reform bid tricky?

Pension reform, a centrepiece of President Emmanuel Macron’s electoral campaign, has been a politically sensitive issue in France for years. 

Macron wants people to work couple of more years by raising the retirement age. This will help France avoid a drag on public finances, which have been strained by the load of retirement benefits. 

But the timing of the move can hurt Macron's political standing as people are upset over the rising cost of living. 

Prime Minister Elisabeth Borne is expected to unveil key points of the plan, which seeks to raise the legal retirement age from 62 to most likely 65, on Tuesday. 

“As I promised to you, this year will be the year of reform to the pension system which aims to balance our system for the years and decades to come. We need to work more,” 45-year-old centrist Macron said in his New Year's Eve address to the nation, adding that the measures were necessary to sustain the country’s pension system. 

The government expects pension system to start running deficits very soon - a deficit mean pension withdrawals by older people have exceeded the contributions made by younger workers. 

Macron promised that a new system would be in place by the end of the summer. However, polls show that the majority of French people are opposed to the planned change in the retirement age, and in the parliament, both the left and the right have criticised the move. 

Data from the Organization for Economic Cooperation and Development shows that France has one of the lowest retirement ages among developed countries, and spends more on pensions than most other countries with pensions accounting for nearly 14 percent of the country's economic output.

However, the reform comes at a challenging time as the country struggles with higher energy and fuel bills. 

Fierce opposition

The current plan is Macron’s second attempt to pass pension reform through parliament after an initial attempt in March 2020 which was called off due to protests and the Covid-19 pandemic.

Although Macron’s government indicated that the process of determining the legal age of retirement was negotiable, left-wing politicians and unions fiercely oppose the plan, and have called for nationwide demonstrations and strikes.

Outbreak of protests as seen in 2018 and 2019 during the Yellow Vests movement can spell more trouble for Macron. 

But if he's able to move ahead, Macron can demonstrate that he has what it takes to make good on his promise whereas his predecessors such as Jacques Chirac and Nicolas Sarkozy have failed. 

In case of a setback, however, Macron’s government may have to resort to using a constitutional provision that bypasses parliament, and which would in turn increase the prospect of a no-confidence vote against him. 

A failure would also call into question Macron’s claims that he can lead France despite losing a legislative majority last year.