34 Europe The EconomistSeptember 14th 2019
21This means that his reforms will, at best,
solve only part of the problem.
Mr Macron’s team argues that it is em-
barking on a redesign that will be as tough
to pull off as it would have been to raise the
retirement age. It will also be more compli-
cated. France has no fewer than 42 differ-
ent mandatory public pension systems,
which have grown up over the decades to
serve farmers, civil servants, actors, rail-
way workers, mine engineers, notaries and
so forth, including a default public scheme
in which everyone not otherwise covered
must enroll. Rules governing pension
rights and contributions vary wildly be-
tween them, and cannot easily be com-
bined. The system is opaque and curbs job
mobility, as rights are hard to transfer. To
replace this tangle, Mr Macron has prom-
ised to merge all these regimes into a sin-
gle, points-based system that treats all
workers equally.
“What the French are trying to do is a big
deal,” says Monika Queisser of the oecd.
“France has one of the most fragmented
public pension systems, and they are final-
ly trying to get things harmonised.” To this
end, Mr Macron this month brought Mr De-
levoye into government. He has already
spent many months conducting a review of
the French system and discussing reform
options. After all these talks, a bill is prom-
ised, but not till next summer.
Up to a point, it makes sense to take the
time to get it right. In the 1990s, notes
Hervé Boulhol, a pensions specialist at the
oecd, it took Sweden nearly a decade to put
in place a similar system. The French gov-
ernment, wary of renewed unrest, wants to
try to forge a consensus. A poll for the Insti-
tut Montaigne, a liberal think-tank, sug-
gested that only 33% of the French cur-
rently back Mr Macron’s reform.
If anything, such doubts will harden
when details emerge. So far nothing is
fixed. Mr Delevoye has said, for instance,
that he wants to identify a “pivot age” of 64
years, around which incentives to work lat-
er and penalties for early retirement would
be based. This could, it is hoped, help
nudge people into working longer. Mr Mac-
ron, however, says that he “would prefer us
to find agreement on the length of contri-
butions rather than on age”. Either way,
harmonising rules will inevitably mean
some lose out. In anticipation, unions
were planning a big public-transport strike
in Paris on September 13th.
The trouble is that, however ambitious
they look, the reforms would not do
enough. Mr Macron promises to close the
pension deficit by 2025, and the idea is to
put in an automatic mechanism that ad-
justs the contribution rules as life expec-
tancy increases. He wants people to be able
to make their own informed choice about
when to leave their desks, and with what
package. Yet the new universal system willdo nothing to curb overall spending on
pensions. Indeed, Mr Delevoye has made
this a selling point, promising in July that
the universal system “will keep an identi-
cal level of pensions spending”.
At some point this will catch up with
France. As it is, there have been big rows
within government about the wisdom of
Mr Macron spending so much political
capital on a project that will not save mon-
ey. It is true that once the system is in place,
it will indeed become administratively, if
not politically, simpler for future govern-
ments to change the rules and make sav-
ings. But in the meantime, Mr Macron is
putting vast effort into a reform that will
leave the task half-done. 7E
mmanuel macron is having a good
summer. In July, at his urging, leaders of
the European Union’s member states
picked Ursula von der Leyen, then the Ger-
man defence minister, to be president of
the European Commission. In a package
deal Christine Lagarde, the French head of
the imf, was chosen to lead the European
Central Bank; Charles Michel, the Belgian
prime minister and a Macron ally, got the
European Council presidency; and Josep
Borrell, Spain’s Francophone foreign min-
ister, will be the eu’s next high representa-
tive for foreign affairs. Having narrowlywon her confirmation vote in the European
Parliament, on September 10th Mrs von der
Leyen presented her proposed line-up of
commissioners at the Berlaymont building
in Brussels. It was another good day for the
French president.
Under Mrs von der Leyen’s proposal—
the European Parliament will begin confir-
mation hearings later this month and must
endorse the new commission as a group
before it can take office on November 1st—
the next commission will be more hierar-
chical than the last. Directly below her will
be a team of three silo-busting “executive
vice-presidents” in charge of the three
broad areas which, Mrs von der Leyen has
indicated, will be her priorities. Margrethe
Vestager will lead on making Europe “fit for
the digital age” and stay on as competition
commissioner—in which role the Danish
liberal has capably taken on American digi-
tal giants and made an enemy of Donald
Trump. Frans Timmermans, a Dutch social
democrat, will be in charge of Europe’s
“green new deal”, accelerating the eu’s pro-
gress towards carbon neutrality by 2050.
And Valdis Dombrovskis, a Latvian Chris-
tian democrat, will be responsible for eco-
nomic and financial affairs, with an em-
phasis on “inclusivity”.
The choice of the three reflects the long-
term shift towards a more political and ac-
tive commission. They come from the
three largest political groups in the new,
more fractured parliament that Mrs von
der Leyen will have to keep happy in order
to secure majorities for her proposals (she
may also rely on Greens, hence the focus on
climate change). Ms Vestager and Mr Tim-
mermans were both “lead candidates” in
the European elections, boosting the
team’s democratic legitimacy. The inclu-
sion of Mr Dombrovskis tackles central-BRUSSELS
The incoming commission president
hands out the jobsThe European CommissionA new Leyen-up
Rewiring the machine