Pension reform: two unintended consequences for retirees

Since the vote on the pension reform and the forced passage of the government with the use of article 49.3, the French are in shock, but are not weakening, if we are to believe the important figures of the last day of mobilization. According to the CGT, 3.5 million demonstrators, 1.09 million according to the Ministry of the Interior, marched in the streets to make their discontent heard. It must be said that in addition to raising the legal retirement age or even the abolition of special schemes, this pension reform will have other unexpected consequences for retirees. We take stock for you.

The executive imposed itself with firmness: the pension reform was adopted in the National Assembly with the commitment of the responsibility of the government of Elisabeth Borne thanks to article 49.3. Despite the filing of two motions of censure, the reform was definitively validated on Monday, which fueled the anger of the unions and the French. While wild demonstrations are multiplying all over France and the last day of the strike, Thursday March 23, recorded records, relations between the executive and the French are becoming increasingly strained.

For the time being, Emmanuel Macron remains inflexible and, as he repeated in the interview broadcast on Wednesday, the pension reform will continue its course until its implementation. In the meantime, there remains the possibility for the Constitutional Council to challenge some of the measures to hope for a change within the text or a potential censorship. Otherwise, from September 1, 2023, the pension reform will push the French to leave professional life at 64, but also to have to contribute longer.

The application of the pension reform will have many consequences on the retirement of the French. If the increase in the legal age of departure, as well as the increase in the duration of insurance, have already been recorded, other unpleasant surprises await the main concerned. Therefore, the complementary health and provident group Malakoff Humanis raised the prospect of an increase in provident contributions.

According to him, the two-year increase in the legal retirement age will cause an increase of around 6%. Useful for reimbursing the loss of income caused by accidents or illness, provident schemes thus provide for prolonged absenteeism of people, who are kept in work longer. The general manager of Malakoff Humanis therefore expects an increase to compensate for this phenomenon.

The comparator Magnolia, meanwhile, expressed another consequence of this implementation: the increase in borrower insurance when buying real estate. This two-year postponement of the legal age of departure will, in fact, increase the risks of temporary or total interruption of work (ITT) between 62 and 64 years old.

This loss being covered by the borrower’s insurance, it is therefore to be feared an increase of around 2 to 5%. Some people are likely to be particularly subject to this increase, in particular those in their forties who wish to take out a loan over 20 or 25 years. In this context, it is strongly recommended to introduce competition, a possibility created by legislative developments.