France to lower retirement age to 60 for some

French President Francois Hollande smiles after his weekly cabinet meeting in Elysee Palace, Paris, Wednesday, June 6, 2012. / AP Photo

Updated 3:40 p.m. ET

(AP) PARIS - France's new Socialist government moved Wednesday to lower the retirement age from 62 to 60 years old for certain workers, bucking a global trend in a gesture to unions that critics say is a costly mistake.

Governments from North America to Europe have been pushing retirement ages higher and higher in recent decades, as people live longer and spend more years on state-sponsored pension checks.

New French President Francois Hollande, who won election last month on a wave of voter anger at austerity measures, proved Wednesday that his leftist campaign rhetoric was not just bluster.

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Raising France's legal retirement age was one of conservative former President Nicolas Sarkozy's key reforms, aimed at reducing heavy government debts as Europe sunk into a continent-wide financial crisis.

The reform met huge, nationwide protests - yet many economists said it didn't push the retirement age high enough.

The minimum retirement age went from 60 to 62, and the age to receive a full pension regardless of how many years you pay into the system went from 65 to 67.

On Wednesday, Hollande's government presented a draft decree at a Cabinet meeting that reverses the retirement age to 60 for those who enter the workforce at 18 or 19 years old and have contributed long enough to the pension system. The right to retire at 60 was seen as a pillar of France's social benefit system for decades.

The government said the decree, affecting about one in six retiring workers, will be finalized later this month and take effect in November.

The decree also slightly eases pension requirements for mothers, noting "the impact of motherhood on women's careers," and for people who suffer workplace accidents.

The hard-left CGT union hailed the move as a "striking decision that breaks with policies everywhere in Europe."

The government says the costs - estimated at euro 1.1 billion ($1.37 billion) next year - will be financed by a small rise in payroll charges paid by employers and employees. The government did not release a global cost for the measure.

Social Affairs Minister Marisol Touraine said the decree is a "choice for justice." Critics in France's powerful unions said Sarkozy's reform had unfairly punished low-income, unskilled workers.

Sarkozy and his allies argued that French workers had it too good, while busy workers in places like China and India are propelling their economies ahead.

France's leading business lobby, MEDEF, criticized the Hollande government's decree as "worrying for the financial future of the pension systems and for the competitiveness of businesses." Conservative politicians denounced it as short-sighted.

The Socialist Cabinet is making the change by decree, amending an existing decree on workers who serve especially long careers, instead of via a law, which would need approval by the lower house of parliament, currently dominated by conservatives.

France is holding parliamentary elections starting Sunday, and Hollande needs to secure a leftist majority to accomplish much of what he pledged on the campaign trail.

His push to lower the retirement age goes against demography: People in France live longer than almost anyone else in the world, with a growing life expectancy of 85 years for women and 78 for men. And it goes against the global tide.

The full retirement age in the United States is being gradually raised from 65 to 67. Germany recently raised the legal retirement age for most people to 65 for women and 67 for men.

In Italy, a few years ago some workers could retire as young as 50, but new austerity measures under Premier Mario Monti put an end to that. The retirement age was raised from 65 to 66 for men, starting this year. For women, it was raised from 60 to 66, starting in 2018.

Three decades ago, France's retirement age, at 65, was among the highest in Europe. In 1982, late Socialist President Francois Mitterrand lowered it to 60.

[ATAT8080]

Why not lower the retirement age to 19?

[smittyc]

Hollande will soon realize, there is reality to deal with. His current behavior will be embraced by his many supporters now, in a couple of months the majority of the French population will curse the day Hollande was elected. France and its economy can be described in two words, leveraged and broke.

[RichZubaty]

Now here is a man with vision! How is concrete pourer or carpenter supposed to work until 62? Much less 60? Make room for the kids at the bottom. Ease out the ones at the top.

[erichsh]

And stick those kids at the bottom with the bill for it.

[retmw1]

The thing is those kids at the bottom don't want those jobs, they want to sit behind a computer with a 6 figure starting salary.

[kbbpll]

China and India are not models to aspire to.

[WakeUpPeople001]

"Sarkozy...argued that French workers had it too good, while busy workers in places like China and India are propelling their economies ahead."

Hey, Sarkozy, maybe French people don't want to be slave dogs like the Chinese and Indians.

Now, go back to Hungary!!!

[John782011]

Hypnotoad realize that many of the shareholders are people invested in the market for their pensions either by a pension buying through wall street or their investing in a company savings plan. So not all are controlled by greed.

[douxs]

Send Wisconsin Gov. Walker there, things will change.

[44wonder]

I would love to have Walker the gov. of Illinois instead of the Demorats we now have...

[LILYGARLOW]

Good for France--I keep thinking that America has it backward--they want old people to work until they are 70 to support the young without jobs---it has to cost less to support an old person on Social Security than it does to support a family on welfare.For companies- the young are more productive and having the elderly retire early ,opens up jobs at entry level wages good for the bottom line. Many young people will miss out on the experience needed for advancement because old people are forced to work well past their old age.

[AOCGUY]

Early retirement doesn't make a lot of sense to me. I'm 60, my house is paid off, no debts to speak of but even if I was of social security age I would have to give up a tremendous amount of annual income to not work and get SSA instead. Why would I want to do that? Unless France's SS payments are much larger than ours I can't see most Frenchmen opting to retire either.

[LILYGARLOW]

Well I really don't feel most blue collar workers can physically handle the stress on their knees, backs and elbows--worn out by years of hard work. I think having 65 year old women moving patients in and out of beds, and painters carrying 5 gal pails of paint,and stock people at your grocery store that spend 8 hours a day unloading trucks filled with 100 lb or more boxes at your grocery store is cruel and unusual punishment --while our young hang out at the beach, or on their parents couch playing on facebook all day!

[retmw1]

LILLY

You hit the nail on the head.

[swh56]

So let me see if I have this right...if a woman has a lot of kids, the government will give mom money to support the kids. Where have I heard this story before? Oh yes, that's right, all over my ******* country.

[boocbsboooooooooo]

If you are responsible, pay your bills, taxes, know how to balances your checkbook. You decide you want a second kid. Your first child is 2 years old, and you pay $1,200 per month for day care. Your second is going to double that. 3rd will triple and so on. so since YOU (the responsible person) understands finances and HAS to pay taxes, you cannot afford that 3rd child.

Meanwhile ****** on the LEft who is a freaking LOSER gets a raise per child born. LOSER Lefty breeds more Democrat voters. You the schmuck (responsible person) pays for it.

Democrats are the scourge of the earth..