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France’s new President Francois Hollande has honored a key election pledge to lower the retirement age to 60 for some workers.
France’s new President Francois Hollande has revealed plans to lower the retirement age to 60 for some workers, holding to a key election pledge amidst warnings from the European Union that the country will have trouble meetings its fiscal targets without spending cuts.
The move was agreed at Wednesday’s cabinet meeting, Social Affairs Minister Marisol Touraine told journalists, according to the Agence France Presse.
It partially rolls back unpopular reforms enacted by previous President Nicolas Sarkozy, whose raising of the retirement age from 60 to 62 sparked weeks of protests in 2010.
According to the BBC, people who began their working lives at the age of 18, as well as older unemployed people and mothers with three or more children, will be able to receive a state pension at 60 instead of 62 as a result of Hollande’s changes.
Touraine told journalists that around 110,000 people would benefit from the move in 2013, at a cost of about 1.1 billion euros ($1.37 billion), though that figure is expected to have risen to 3 billion euros ($3.75 billion) per year in 2017, the BBC reports.
According to Reuters, the move drew a stinging rebuke from the leader of the conservative UMP party, Jean-Francois Cope, who said the change was “madness” as its “tempts fate” and “risks the downgrade of France’s credit rating,” adding that “it is not possible for Francois Hollande to continue to bury his head in the sand.”
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Last week the European Commission – the executive arm of the EU – warned Paris that France would have difficulty meetings its fiscal targets unless it implemented spending cuts, and that pension system financing would have to be closely monitored.
According to The Wall Street Journal, Wednesday’s reform comes just days ahead of parliamentary elections in France, and will likely raise further concerns about Hollande’s ability to tackle France’s deficit as the rest of the euro zone struggles with a deepening debt crisis.