France's unions bring pensions battle back onto the streets

[PARIS] Public sector workers marched peacefully through cities across France on Tuesday, heeding a call by trade unions to stage one of the biggest protests in decades in a revolt against President Emmanuel Macron's pension reform.

Commuters grappled with widespread transport chaos on a sixth day of strikes that unions said forced dozens of schools to close in Paris, airlines to cancel 20 per cent of flights and refineries to halt distribution.

The unions show no sign of backing down in a battle that could define the presidency of former investment banker Macron, who is determined to simplify a system of more than 40 pension plans that provide some of the world's most generous benefits.

"Yes, there is a need to reform the pension system. But there's no need to break it," Philippe Martinez, head of the hard-left CGT union told public broadcaster France 2. "Macron's project is each to his own. Ours is about solidarity."

The unions urged rail workers, doctors, teachers and other public workers to turn the screws on Mr Macron before his government unveils the details of its proposal on Wednesday.

In Bordeaux and Marseille, thousands of protesters waved union flags and held up banners reading: "We have to get rid of Macron". Demonstrations are also taking place in Rennes, Lyon, Nantes and Paris. In the capital, riot police fanned out along the Champs Elysees boulevard in central Paris and barricaded streets leading to the offices of Mr Macron and his prime minister.

The days ahead will test whether Mr Macron can deliver the social and economic change he says is necessary for France to compete with powers like China and the United States.

"What's at stake goes much beyond simply overhauling the pension system," said Christopher Dembik, an economist with Saxo Bank in Paris. "For Emmanuel Macron, it's about not losing face to the 'old world', to the institutions he vilified during his campaign, and to reassert his ability to reform the country."

Mr Macron wants to replace the convoluted system with a single, points-based system, under which every pensioner has equal rights for each euro contributed.

Failure to reform would mean a deficit of up to 17 billion euros (S$25.6 billion), an independent pension committee forecast.

Mr Macron is aware of the public opposition to simply raising the retirement age of 62. One alternative is to curb benefits for those who stop working before 64 and give a boost to those who leave later.

Room for concessions may lie in the pace at which the changes are phased in.

The strike is among the biggest since 1995 when prime minister Alain Juppe was forced to abandon an overhaul of the pension system after weeks of industrial action. Mr Juppe's Cabinet never recovered from that defeat.

The closer the strikes get to Christmas, the more difficult Mr Macron will find it not to make substantial compromises, Saxo Bank's Dembik said.

Equally, the unions will also be wary of losing public support the longer the disruption continues. A survey published in the Journal du Dimanche showed 53 per cent of the public backed the strike for now.

"This strike can't go on forever because people will have enough," said pharmacist Jean-Francois Vincent. "Macron won't cave in because that would show he is weak. But he will make concessions."

REUTERS