Persistent protests leave France in pension reform gridlock

The stalemate between Emmanuel Macron's government and labor unions deepened as France headed into a third week of transport strikes over the president's effort to reform the country's pension system, threatening further turmoil during the busy holiday season.

Negotiations between the unions and the government have been suspended. Complicating matters, Mr. Macron's point man for pension reform resigned Monday after it was exposed that he failed to report multiple side jobs, which is forbidden by French law.

While Mr. Macron has barreled through reforms of tax and labor laws, the current impasse is evidence of how deeply the French are wedded to their pension system. Reforming it is the crown jewel of Mr. Macron's effort to modernize France by merging 42 separate pension regimes and offering incentives to push back the age when workers retire to 64 from 62 in 2027.

France faces a third round of demonstrations and protest marches Tuesday. The government said it would stand by the reform measures, even as it conceded that the protests were starting to take a toll.

"I think in today's marches there will be many of us; we will able to demonstrate to the government our ability to move the line," Laurent Berger, head of CFDT, the country's biggest labor union, said on LCI television Tuesday.

Prime Minister Edouard Philippe has invited labor unions and employer organizations for talks Wednesday. Agence France-Presse reported. On Thursday, he will host a joint meeting of unions and employer organizations.

Mr. Macron's administration has said it could agree to roll back some aspects of the plan but it promised to maintain the project that would end the special status of many public service workers, from metro drivers to Paris Opera dancers, and ensure that pension payments don't place a burden on the state budget.

Mr. Berger reiterated his call for the government to drop its plan to raise the retirement age, threatening more marches next month.

In an interview published Tuesday in La Croix newspaper, Mr. Berger said one option could be to increase contributions rather than raising the retirement age, a solution not favored by the government.

"Raising contributions means less spending power for workers or more charges for employers; it would kill the economy," Budget Minister Gerald Darmanin said in an interview with LCI television Tuesday.

Mr. Berger said his union would resume talks Wednesday with the government, warning the prime minister that a reform that puts "budget priorities first" would face opposition.

The strikes, which started on Dec. 5, are creating havoc for workers commuting on public transportation — mostly in and around Paris — and leading to hundreds of miles of traffic jams. They could eventually weigh on the economy as people try to finish their holiday shopping and prepare travel plans.

The government has called for a truce over the Christmas period. Mr. Berger concurred, saying blocking people during the festivities would be "bad for our image."

Labor unions will be tested on their third day of nationwide marches to oppose the plan. While the first march on Dec. 5 drew more than 800,000 people, the biggest turnout since Mr. Macron took office in May 2017, the second march on Dec. 10 had fewer than half that, according to the Interior Ministry.

Complicating matters for Mr. Macron, Jean-Paul Delevoye, his pension chief, resigned Monday after after he failed to declare multiple paid and unpaid positions in organizations including think-tanks and trade groups. The French presidency said he would soon be replaced.

Public opinion in France is divided. Mr. Macron's approval rating climbed 2 points to 30% while Prime Minister Edouard Philippe's is up 4 points to 30%, according to an Elabe poll for Les Echos and Radio Classique on Monday. And that's while 54% of people either support the strikes or are sympathetic to them, according to an Ifop poll published on Sunday.

French people also support some aspects of the reforms, the Ifop survey showed. About two-thirds agree with phasing out the special retirement plans, while only 37% support pushing back the age for retirement with full pension to 64.

Bank of France Governor Francois Villeroy de Galhau played down the impact the strikes may have on the economy, saying in an interview with French daily Le Figaro that "our experience is that in the end these movements don't weigh much on economic growth."

The strikes are, however, fraying the nerves of commuters having to squeeze into the few trains and buses still running or sitting in miles of traffic jams.

"The time has come to find a way out because the consequences are serious," French Finance Minister Bruno Le Maire said on RMC radio on Monday. "This conflict is weighing on the morale of the French people."