Why do people like France so much
The French government unveiled its controversial plan for a new pension system this Wednesday. Monika Queisser heads the Social Policy Department at the Organization for Economic Cooperation and Development (OECD) in Paris and is an expert on pension systems. She explains why French President Emmanuel Macron's pension reform plans scare many French people.
Süddeutsche Zeitung: The French are protesting en masse against changes in their pension system. Do you have so much to lose?
Monika Queisser: Yes, they do. The employees of the state railway SNCF, for example, have much more favorable conditions for access to a pension than other employees. They also know that they will be among the losers. The strikes at the railways are therefore not surprising if a uniform system is to come now in which all French workers are organized.
It's not just the SNCF employees on the street.
There are different groups that see themselves as losers because they enjoy conditions today that cannot be extended to everyone. Some of the unions claim that the best conditions should apply to all. High earners such as lawyers are also rebelling against the reform. So far, they also have their own system and high capital reserves. If this is integrated into a pension based on points, they will have to pay more contributions in the future and will be paid less. Since lawyers often earn very well, the question of solidarity with the rest of society arises. But they just say: "We don't want to participate in the reform, we have a good system into which we have contributed."
In Germany, the French strike stands more for a protest directed against the dismantling of the welfare state. Is that too simplistic?
Under no circumstances would I interpret this as dismantling the welfare state. On the one hand, people understand very well what they have to lose by increasing the retirement age. On the other hand, the technical functioning of a pension system is often so complicated that diffuse fears arise. In fact, many French people think it's a good idea if the same rules apply to everyone. But the longer the discussion lasts, the greater the fears. The French teachers, for example, are badly paid, they earn half of what a German teacher gets. At the same time, their pension is comparatively higher. The government has not yet given an answer on how exactly the change should be made for the teachers.
The trick with Macron's reform is that in future it will no longer only take into account the best earnings years of a professional life for the amount of the pension. Doesn't this level the pensions down overall?
It depends for whom. For people who receive the minimum wage, the salary is relatively stable over their working life. For people who have a rapid salary progression, it is of course better to only use the best 25 years for the pension calculation or, even better, only the best salary, on the basis of which the pension is then calculated.
Who could benefit from the reform?
The government has not yet released enough detailed information to judge. You know that there should be improvements for parents, for example. So far it has become clear above all who will lose. But one gain could be that society as a whole is more just when the same rules apply to everyone and, for example, no longer only benefits those who have rapidly increasing salaries. But if things get fairer, that doesn't mean that individual groups will automatically get more.
Can you roughly outline the differences between the German and French pension systems?
The German statutory pension system is standardized, while the French one has 42 different systems. Many French people receive benefits from three or four different insurers, depending on how often they have changed jobs. This confusion is difficult for the individual to see through.
Are both countries facing the same challenge that they have to finance the baby boomers, the baby boomers?
Demographic pressure is significantly greater in Germany than in France. However, compared to France, Germany has the advantage that the labor force participation of older workers has risen sharply. Germany is the front runner among OECD countries for this number. People in Germany are working longer and longer.
Because they are afraid that otherwise they will not be able to finance their retirement?
I wouldn't start speculating now why that is. There are certainly some who want to work longer. And there are others who have to.
There is significantly more old-age poverty in Germany than in France.
Yes absolutely. But one cannot infer old-age poverty from the amount of pensions. Many other factors also play a role in whether you have income from other sources, such as rent or capital income, or whether you are single or not.
Most French trade unions want to keep the current system and at the same time lower the retirement age for everyone involved. Would that be possible somehow?
I don't see how France, with a very high life expectancy by international standards, can shorten instead of lengthening working life. The trend all over the world is towards longer working hours. France has a low labor market participation of older people. The French leave the labor market at an average of 60.8 years. So at the same time you have to talk about how you can enable people to stay in the labor market longer. Many can no longer find work in old age, even if they are looking for one. If it really is the case that people become unemployed in old age and at the same time the official retirement age is continuously increased, then of course the risk of old-age poverty also increases.
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