Is retirement possible at age 60?

It’s an important turn. The leadership of the Socialist Party (PS) subscribes to the proposals of the program of insubordinate France with a view to an agreement in the legislative elections, according to a document made public this Friday, April 29. Until now, socialists and insubordinates opposed one of the great reforms of the socialist François Mitterrand, who had made retirement sacred at the age of 60. A success on which a right-wing president, Nicolas Sarkozy, returned in 2010, gradually extending the legal retirement age to 62 years. The aim was then to balance the structurally deficient system.

When he returned to power in 2012, the Socialist Party did not change that principle. The ordinances issued by Marisol Touraine in 2014 even extended the required contribution period, while granting some adaptations for difficult jobs and long careers. It is this status quo that defended Anne Hidalgo, the Socialist candidate, in the presidential election. A position that did not survive its electoral defeat.

Mélenchon in the footsteps of Mitterrand

Following his mentor François Mitterrand, Jean-Luc Mélenchon (LFI) is demanding a return to retirement at the age of 60, but with 40 years of contributions, when the former president had introduced him at the age of 37.5. A reform that Mélenchon wants to complete with a revaluation of the amount of pensions at the level of the minimum wage.

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And above all, indexing pensions to wages. A point not very present in the public debate but fundamental. The standard of living of pensioners began to stagnate from the indexation of prices, and no longer from wages. Therefore, in the coming years, the gap between the amount of pensions and the amount of salaries will increase. Gradually, with constant reform, the standard of living of retirees will return to that of the 1980s, according to the projections of the Pension Guidance Council (COR).

Opposition to Macron’s project

It is at this point that Emmanuel Macron insists on extending the legal age to 64 or 65, which socialists and rebels agree to denounce. The stated goal of the re-elected president is to limit the decline in pensions relative to pensions, without increasing workers’ contributions. Beyond that, it’s about making savings that need to be deployed elsewhere, and in particular in dependency financing. To justify his reform, Emmanuel Macron relies on the extension of life expectancy. “The argument was valid yesterday, it is less so today. We don’t know if it will be tomorrow. “says economist Alain Trannoy, a professor at the Aix-Marseille School of Economics, interviewed by Marianne.

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Due to the Covid-19 epidemic, life expectancy at birth fell in 2020. According to INSEE data, it is 85.1 years for women (-0.5 compared to 2019) and 79.1 years for men (-0.6). On the contrary, life expectancy without disability, therefore in good health, is rather increasing according to the DREES, at 65 it stands at 2020 at 12.1 years for women and 10.6 years for men .

Stability in the event of breakage

Previously, the PS advocated stability. According to the Pensions Guidance Council, past reforms have made it possible to control the deficit of the system and, above all, to control the part of GDP (Gross Domestic Product) that is used to finance pensions. It is this indicator that allows us to assess the sustainability of the system. After 2030, this expenditure-to-GDP ratio is expected to decline, although the French population is aging. Without a new reform, France would spend less, in proportion, to finance the pensions of its retirees.

Jean-Luc Mélenchon’s project is very different and would break with the COR’s balance forecasts. He defends the idea that “To live longer in dignified and healthy conditions, you must be able to stop working soon enough”. Therefore, we must agree to spend more to finance pensions. France Insoumise estimates that moving from the legal retirement age to 60, with full-rate retirement after 40 years, would cost 29 billion euros a year. Wage indexation is estimated at between 14 and 19 billion each year. Combined with other measures, it would mean spending at least 70 billion more a year.

PS conversion in case of failure

Nothing impossible in itself, but it is a cost comparable to the budget of the Ministry of Education, Youth and Sports which is 77.7 billion euros in 2022. To finance his project, the leader Insoumis has a slight increase in old age . type of contribution and commitment to new contributions extracted from the ” income from profit sharing, participation, employee savings, as well as corporate financial income ”.

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It is clear that financial capital would be largely contributed, so as not to bear the burden of employees too much. France would continue to be a European exception, allocating a substantial part of its wealth to finance pensions. Having ruled hand in hand with regard to public spending, the PS is now embarking on a major ideological gap.

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