World News: France Grapples with Retirement Benefits

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Category: World News - Europe

Published on Wednesday, 19 November 2025 12:40

Written by Olivier Longhi

As Baby Boomers reach the ripe old age when Social Security, the monies contributed during their prime working years now supplement their non-working years, some countries are grappling with the financing of the pension budget.

Consequently, that of the pension systems will come up against the question of extending the contribution period. As a political instrument, pensions are intrinsically linked to the birth rate and life expectancy the former insufficient, the latter on the rise.

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Like a sea serpent, the need to vote on a budget as soon as possible is constantly on the agenda of parliamentarians, in this case those of the Senate who are called upon to examine the Social Security financing bill before examining the suspension of the pension reform.

The Upper House having already announced that it would vote against this suspension, it is a safe bet that the text, which has become a point of tension for the National Assembly, will precipitate the end of the Lecornu government. And if for the moment the question of the fall is not on the agenda, it is also worth recalling several objective elements that can explain why the successive reforms relating to the financing of pensions always call for an extension of the contribution period, in concrete terms an extension of the working time.

The first factor explaining this is the demographic situation in France. With an average number of children per woman of 1.59 in 2024 (compared to 1.8 in 2022), France cannot ensure a generational renewal capable of resolving the issue of pension financing.

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Pensions and quarrels

For this to be at least effective, it would be necessary to have a number of children per woman of at least 1.8, or even 2.2 to ensure optimal renewal. The second element, still of a demographic nature, and of which few will complain, is the increase in life expectancy. Set at 85.6 years for women and 79.9 years for men, life expectancy plays a considerable role in the financing of pensions in relation to the length of time pensions are paid.

On reading these elements, it becomes clear that the successive retirements can only propose an extension of the contribution period. The debates surrounding long careers and early departures with regard to the legal duration ultimately appear to be  only marginal, above all a matter of ideological quarrel.

Instrumentalized for purely political ends (François Hollande had re-established the possibility of retirement at sixty with a discount if the quarters contributed were not sufficient), the question of the financing of pensions has ended up losing sight of the general interest, which calls for an extension of the contribution period so that everyone benefits from the pay-as-you-go system.

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Forecasting and lengthening

Another option, just as painful, is that of increasing employer and employee contributions. Inaudible to business leaders, unthinkable for employees, this increase would offer the advantage of reducing the contribution period by all or part in the light of the forecasts established and of ensuring that future retirees, those born between 1965 and 1980, have firm and decent pensions.

However, this option, which would hinder purchasing power and weigh on employment, potentially making the cost of labour potentially higher, is not on the agenda. The only option that will eventually prevail is to extend the contribution period. However, this is in no way new because already in the course of the seventies, when the French birth rate had begun to decline, all the indicators showed that the financing of pensions would become problematic at the turn of the nineties. Thus, the first reform in this area took place in 1994 with the increase from 37.5 years of contributions to 40 years. Successive reforms only confirmed the reality that began to take hold in the seventies. In fact, one conclusion must be drawn: the golden age of pensions is over.

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Bio: Olivier Longhi has extensive experience in European history. A seasoned journalist with fifteen years of experience, he is currently a professor of history and geography in the Toulouse region of France. He has held a variety of publishing positions, including Head of Agency and Chief of Publishing. A journalist and recognized blogger, editor, and editorial project manager, he has trained and managed editorial teams, worked as a journalist for various local radio stations, was a press and publishing consultant, and was a communications consultant.