Protesting About Retirement & An Attempt At Pension Reform

Reform. It’s a risky but also sometimes necessary action to make a company or even a country better. And that’s what happened recently in France.

To understand the situation in France, you need to understand a pension first. Pensions are a kind of retirement plan that provides monthly income after you retire, and your employer contributes to funds invested in your (and other employees’) benefit. A fraction of your wages may also get contributed, which would aid you in the future after you retire.

Now it’s time to get into today’s topic. It all started when French President Emmanuel Macron tried to reform the complex pension system of the country. In truth, 42 different pension schemes make up the French pension system, with differences in benefits and retirement age, as well as for private and public sectors. Mr Macron wants to reform this complex system, create a unified pension system, and raise the official retirement age from 62 to 64 (to qualify for full pension benefits). However, for supporters of this plan, there would always be the opposing. It just so happened that most of the public made up that opposing side, with crowds of people protesting in the streets while unions carried out strikes.

To know why strikes and protests are happening, we need to understand the deal about retirement, though please note that it will be a much-simplified version. After finishing school, the logical decision for many is to find a job. You may choose to change occupations throughout your career, though ultimately, people retire to enjoy a work-free and happy life. However, to enjoy post-retirement life, you need to have enough money as you stop earning money after you retire, though you keep spending.

If you want enough money saved up for a comfortable retirement, you should keep a percentage of your yearly income invested somewhere. Depending on your preferences, you could invest in government bonds, stocks, a bank, etc.

Assuming you have saved enough for retirement, you face the “Dilemma of Retirement,” a nickname I created for the hard choice people face pending retirement, which is about when they retire. Retiring too early, which may seem a great option, isn’t that ideal. Since you retired early, though (most of) your co-workers and friends hadn’t, you could find yourself quite lonely. That usually drives the person back into the workforce.

Then there’s the other option, retiring late. The average global life expectancy (as of 2019, before the pandemic) is 73.4 years, according to the World Health Organization. So if one retired too late, like at 70 years old, they would have less time to enjoy life, with most of their adult life spent working. And that sums up the Dilemma of Retirement.

So back to Mr Macron’s pension reforms. The public acted in protest and strikes because after raising the official retirement age, the government still paid people the same pension (with no added benefit), but workers had to work two extra years for it.

However, Mr Macron’s government argues that the system is falling apart rapidly due to the ratio of workers to those in retirement diminishing quickly. According to the BBC, the ratio was four workers per retiree 50 years ago, while it has now fallen to approximately 1.7 per retiree and is poised to fall further in the future.

Nearly all other European countries have taken steps to raise the retirement age. So what do you think? Will Mr Macron’s reform also succeed? Or is it going to get overpowered by the opposition? Is it even necessary? That’s the end of this production from the New News Newsminute. Thank you for reading, and tune in next time for more global news updates.