France needs a sensible pension reform

Plans by the French government to raise the retirement age have met with resistance. French economist Jacques Bichot explains in an interview with the weekly magazine Le Nouvel Observateur that while pension reform is badly needed it must be tackled in a different way: "The situation today is completely archaic. It does all it can to induce the French to up their productivity by retiring later, but it fails to give adequate compensation. All previous reforms have confused retirement age with the duration of pension contributions. The US system is very interesting. You always hear about the pension funds, but there's more to it than that. This system procured a savings surplus of 150 billion dollars in the past year alone. ... On the long term we will need at least seven years to revamp the system, introduce a point structure and unify the various schemes."

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