Our view on pension reform: a quick compromise for controllable decay?
For many, the government would have the choice between finding a quick compromise on pension reform or letting the social conflict rot while moving forward in the adoption’s procedure of the future law. On the contrary, we do believe that it must reach this compromise as soon as possible so it can overcome the inevitable decay of the strike, given the irreducible opposition of some of the unions and their base against the universal points-based system.
The new year begins as 2019 ended, with public transport, or more precisely the SNCF and RATP, in slow motion and a strike that breaks length records every day. The President of the Republic’s call for a holiday truce from Abidjan has not been heard, even though traffic has slowly but significantly resumed. And the latest opinion polls show only a slight erosion of French support for the protest movement. As expected, the good wishes addressed to them by Emmanuel Macron did not contain any elements that could immediately unblock the situation.
However, by urging the government, after having reiterated that he intended to complete the reform of the pension system, “to find ways of a rapid compromise”, the President implicitly but clearly signified his vision of the way out of the crisis and therefore what his strategy will be in the coming weeks. This strategy is now based on the search for a compromise and at the same time on the acceptance of a decaying strike.
Ways to a rapid compromise
As any renunciation of the creation of a universal points-based system is explicitly excluded, the compromise, beyond the categorical negotiations largely undertaken and which will not be sufficient, can only be found with those trade unions that support the change of system or at least accept its principle. And it can only be done on the “red line” defined by them: the setting by the future law of a pivotal age at 64 years old. Emmanuel Macron did not mention this aspect of the reform in his speech.
Concretely, the solution is simple: since responsibility is the third pillar of the reform, it is sufficient to remove the pivotal age from the bill and entrust the social partners, who will manage the future system, to define, before 2022, the year in which it will be put into place, the means to ensure its long-term balance. Under the control of the Government, of course, and while preserving its capacity to replace the governance of the system if it were to fail. This is how Unedic1 has been operated for many years.
Such a decision will not be enough to put an end to the strike since most unions and their base are demanding the withdrawal of the reform. But it will make it possible to change the balance of power and strengthen the trend towards returning to work. If France is not paralyzed and its economy continues to run, the government can initiate and continue the legislative procedure, denouncing the constraints imposed by the people in strike on all citizens. And the more non-striking employees of the SNCF and RATP are numerous, the less their fellow strikers can prevent them from working. This would lead to a situation comparable to the one that prevailed in the spring of 2018 when the SNCF’s status was reformed: a partially followed strike, which users accommodate as best they can, day after day, punctuated by major demonstrations at the most important stages of the bill’s examination: adoption in the Council of Ministers, opening of the parliamentary debate, vote on the bill…ie. additional three to four months of conflict.
Rotting, a double-edged sword.
Although it seems inevitable, this scenario is not without real dangers for the government but also for the trade unions.
The ineffectiveness of its movement should lead to an increasing radicalization of at least part of the base, with the risk of a multiplication of punch actions that can always degenerate, with public opinion being able to blame the government for possible incidents or blunders. This could breathe new life into the mobilization against the project. Not to mention the potential effects of a long-term conflict on the results of municipal elections.
But, for the trade union rejection front, rotting is not necessarily harmless either. Engaging their base in a conflict of unprecedented duration, running the risk of being overwhelmed by some of the striking employees and instrumentalized by violent groups, as was the case in the spring of 2018, assuming the financial sacrifices that this movement will involve, for finally not being able to prevent the abolition of the special regimes, is not likely to strengthen trade union organizations and ensure their sustainability. They could end up durably weakened from such a failure.
Emmanuel Macron has been too committed to the principle of the establishment of a universal points-based system during his election campaign and then since the beginning of his mandate to consider abandoning it. Edouard Philippe will have to use all his political expertise and communication skills to agree to remove the parametric measures from the law, which he insisted on introducing even though candidate Macron had excluded them, without weakening himself to the point of no longer being in a position to lead the implementation of the reform, after its adoption by parliament and… the municipal elections.