Towards a Universal Pension Points System in France

Abstract

could have happened in the absence of systemic reform if the political will had been such. Current French pension system Main schemes for private sector workers A specifi city of the current French system is that a private sector worker is currently covered by two mandatory public pay-as-you-go (PAYGO) schemes: a general defi ned benefi t (DB) scheme-which is the main component-managed by the state and a points scheme (Agirc-Arrco) managed by social partners, together representing about 70% of paid benefi ts. The other 30% comes from special regimes, including those covering civil servants. To get a full pension in the DB component, individuals must be older than 62 years and have contributed for 41.5 years (43 by 2035) or be older than 66 (67 in 2022) years. Contribution rates are relatively high in France, the average age of labour market exit is low and pension spending is high at about 14% of GDP (OECD, 2019a). Reforms over the last decades have increased both contribution rates and retirement ages, and lowered replacement rates (OECD, 2019b).

Pension Systems in the EU — Some Policy Issues

“…See also the discussion in Valkonen (2020). 3 See Valkonen (2020) for Finland and Boulhol (2020) for France. 4 Data on the distribution of life expectancy outcomes would have been preferred, but by its nature such data comes with a large temporal lag.…”

“…The French pension reform proposal, currently going through legislation and social partner deliberation, is covered in great detail in this issue by Boulhol (2020). As with the Italian case, fi nancial sustainability and simplifi cation of a fragmented pension system are important objectives.…”