The controversial reform spearheaded by Prime Minister Gabriel Attal has been put on ice following Sunday’s election result.
France’s Prime Minister Gabriel Attal has decided to suspend a proposed revamp of the country’s unemployment benefit system following the first round of France’s legislative elections.
On Sunday, the right-wing National Rally party (RN) and its allies won 33% of the vote, followed by the left-wing alliance, the New Popular Front, on 28%. President Macron’s Ensemble coalition came in third, with just shy of 21% of the vote.
Given the criticism of Attal’s unemployment reform by the two leading parties, the Prime Minister has doubled down on one of his major aims since he took office in January.
The formalisation of the decree didn’t take place on Monday as planned, despite contrary claims made by Attal last month.
“A decree will be issued by 1 July for this reform which builds upon the framework that was put in place by the 2019 reform,” the Prime Minister told France Inter radio on 13 June.
Attal was speaking just days after the European elections, where Macron’s Renaissance party was badly beaten by the RN, prompting the snap French election.
“[The reform] above all is coupled with better support for the unemployed to help them return to work,” added Attal.
Changes to the benefit system
The government’s proposed reform suggests that unemployment benefits should be limited to a maximum of 15 months for those under 57, down from the current cap of 18 months.
Attal also plans to reduce the eligibility criteria, meaning that someone must have worked at least eight months during the last 20 months to receive state payouts.
Currently, claimants must have worked for at least six months during the last 24 months.
The leftist New Popular Front has branded the reform as “cruel” and said they would appeal it immediately.
Jordan Bardella of the RN, speaking to France 3, also showed his disapproval of the measure: “I’m a little fed up with people systematically asking for efforts from the same people.”
Also on the right, candidates from The Republicans party are split on the issue. Powerful trade unions are vehemently against the reform.
Boosting growth by tackling unemployment
A number of economic experts, however, stress the necessity of increasing France’s employment numbers in order to boost growth – one of the hallmark policies of President Macron’s tenure.
Since he came to power in 2017, Macron has made a number of changes to the country’s unemployment system that have boosted worker numbers.
Even so, French finances aren’t currently so rosy, particularly as the government purse strings are restricted by a widening budget deficit.
In 2023, the deficit rose to 5.5%, overshooting the state’s target of 4.9%.
“If France wants full employment, if it wants to re-industrialise, if it wants to remain a leading economic power, it must move towards full employment and therefore it must continue with the jobless benefit reform,” Finance Minister Bruno Le Maire told France Inter on Monday.
“I am not going to change my beliefs in the space of 24 hours because I have to convince someone or other.”
Pausing the reform could be a means for the government to avoid stoking early conflicts with political adversaries, despite the economic risks.
