Paris: A French pension reform that raises the retirement age has been signed into law by President Nicolas Sarkozy after months of protests, leaving him free to focus on the last leg of his term and an election in 2012.
The law that will gradually raise by two years the minimum retirement age and the fully pensionable retirement age, to 62 and 67 respectively, was published in the 10 November edition of France’s Official Journal, where all laws are first published.
The law was adopted by parliament at the end of October and cleared a final hurdle on Tuesday when France’s Constitutional Council approved it.
Fierce opposition by trade unions and the French public, who staged the most sustained wave of protests that Europe has seen over austerity measures in recent times, turned the pension reform into the biggest battle of Sarkozy’s presidency.
He stood his ground and even resorted to special procedures to accelerate parliamentary adoption of a law designed to help the French pension system to deal with an age crunch.
France’s pay-as-you-go system is expected to come under more strain as the number of people drawing a pension rises relative to the number of working people whose taxes fund that benefit.
The pension population is rising as the baby-boom generation born in the years after World War Two floods into retirement, and also because life expectancy is increasing.
Last leg reshuffle
Sarkozy’s popularity ratings are close to rock-bottom with an election in the first half of 2012 starting to loom larger in French political life.
With the pension reform now on the statute books, the way is clear for him to reshuffle his government team for the final leg of his five-year term. He signalled last June he would do so but officials said he wanted to clear the decks on the reform first.
As many as 70% of French people disapproved of Sarkozy’s pension reform in opinion polls.
To back down would have left his presidency in tatters after he swept to power in 2007 on pledges of a clean break with the inertia of the past.
He was also under pressure to prove he could fix France’s public finances after the global recession of 2008-2009 and protect the top-notch credit rating that allows the country to service its debt as cheaply as possible in financial markets.
Unions mobilised nationwide street protests eight times since early September and rolling strikes at oil refineries caused serious fuel shortages at one stage, but the strikes are over and the turnout for protests has slumped.
Unions say Sarkozy’s stand over the issue will leave scars but they stopped short at a meeting on Monday of calling for further nationwide protests.