Article, 20100928, contibuted by kyung jin, Lee

·        EUROPE NEWS

·        SEPTEMBER 23, 2010, 9:16 P.M. ET

Pension Protests Sweep France

 

By NATHALIE BOSCHAT (The Wall Street Journal)

PARIS—French unions staged a major showdown with the government Thursday, with demonstrations and strikes taking place across the country to protest a pension overhaul that will raise the retirement age to 62 years old from the current 60.

French President Nicolas Sarkozy recently described pension changes as one of the most important issues for France. He has staked his government's financial credibility on it as France has embarked on a cost-cutting drive aimed at bringing its public deficit from a projected 8% of gross domestic product this year to 3% in 2013—the maximum allowed under euro-zone treaties.

Despite significant disruptions in the transport system, particularly in train and air travel, the action was showing some signs of fatigue around midday with fewer workers on strike than at a previous demonstration against the pension revamp on Sept. 7.

Around 20% of civil servants working for the French central administration were on strike around midday, compared with nearly 25% at the earlier protests, according to the French Civil Service Ministry. That rate reached 23.6% for civil servants working in the public-education system, fewer than the 27% of strikers at the beginning of September. The Interior Ministry had counted just under 410,000 demonstrators at 110 rallies across the country, compared with 450,000 people at 114 rallies on Sept 7.

The eight unions driving the action were hoping to muster more people on the streets than during the previous demonstrations, when between 1.1 million and 2.7 million people took to the streets, according to rival estimates produced by the Interior Ministry and unions.

The unions are united in demanding the retirement age be kept at 60, and hope to weigh in on debate over the bill, which starts in the Senate on Oct. 5, amid record-low popularity ratings for Mr. Sarkozy's right-wing government. The bill was adopted last week by the National Assembly.

As protest marches started in Paris around lunchtime, Bernard Thibault, leader of the communist-leaning union Confédération Générale du Travail, or CGT, described the action as having "roughly the same scope" as the previous one, adding the government risks facing a new phase of conflict if it doesn't budge on the pension overhaul.

So far, the government has remained intractable on a move it has said will save €20 billion ($26.79 billion) by 2020 and will balance the books of the pension system by 2018.

Labor Minister Éric Woerth said Monday the financial equilibrium of the reform rests on raising the basic retirement age to 62 and the age for full entitlements to 67. But he said he was open to some concessions for disabled workers and unemployed people who are close to retirement, and that he would work towards closing the salary gap between men and women.

Thursday's strikes caused significant transport disruptions, with only half of high-speed and regional trains running, and certain provincial networks operating only one-quarter of normal services, according to state-owned rail operator SNCF.

Workers commuting to Paris from the suburbs faced major difficulties with only one in three suburban trains circulating on some lines, but services on the Paris Métro were smoother and close to normal levels on most lines, according to the RATP subway operator.

Flag airline Air France-KLM said it was canceling half of its short- and medium-haul flights out of Paris but maintaining all its long-distance flights. French oil major Total SA said 50% to 80% of its French refineries' employees had joined the nationwide strike but that there was "no significant impact" on output.

The eight unions plan to meet on Friday to decide whether and how to continue their protest campaign.