Hollande faces wrath of unions at social conference

President François Hollande prides himself on being a man of dialogue and consensus. So it is in character for him to launch France’s second annual social conference today. The atmosphere will be far less congenial than a year ago.

Employment is the stated priority of the two-day meeting of cabinet ministers, business management and trade unions. They will confront three thorny issues: pensions, training for the unemployed and the status of France’s bloated civil service.

Two-thirds of French civil servants voted for Hollande, and conservatives see him as the president of the public sector. Yet Hollande's base constituency arrive at the social conference in anger. They disliked suggestions in a recent government report that the method for calculating public-sector pensions should resemble that used in the private sector. Then Marylise Lebranchu, the minister for state reform, announced on Tuesday that public-sector salaries would remain frozen.

Declaration of war
The last rise in the civil servants' pay index, of 0.5 per cent, occurred three years ago. A 1 per cent increase would cost the government €1.8 billion annually, which it cannot afford. "The Germans gained competitiveness by moderating their salaries over a decade," notes a presidential adviser. "The salaries of state employees are frozen, but the private sector raised salaries 2.5 per cent last year."

Six of France’s eight main trade unions are threatening to strike in protest at the public-sector freeze, which one union leader called “a declaration of war” and another termed “betrayal”.

The government has already said it expects no breakthrough on the questions of pensions or training. Anxiety among civil servants seems exaggerated, since prime minister Jean-Marc Ayrault has excluded aligning public-sector pensions with the private sector, saying: "I will oppose this reform being used to pit categories against each other." Likewise, officials say the government will not touch the infamous régimes spéciaux which give preferable treatment to professions with powerful unions, particularly the railroads, gas and electricity companies.

The Hollande administration has found a clever alibi for leaving régimes spéciaux untouched: "That was done in 2010 [by Nicolas Sarkozy]," says a presidential adviser. "It was done sloppily, but the system will converge over time, and it's not essential today."

So the main issue to be hammered out, between now and September, is how many years French people will have to work to obtain a full pension. Hollande refuses to touch the sacrosanct official retirement age of 62. But the number of years one must contribute to the pension system is likely to be increased from 41.5 to 44.

Hollande wants to establish a “personal training account” for the unemployed, and says half of all jobless should be offered training within two months of registering with the unemployment office. The government’s “fundamental strategy,” an adviser said, “is to deal with youth unemployment by returning to growth. It’s very important that French youths not spend a year or two on the PlayStation.”