Without “manifest inequality at the global level” but “highly variable” effects from one official to another: a possible application to the public sector of the rules for calculating private pensions would make “winners” and “losers”, according to a study published on Thursday.
If the government seems to rule out the hypothesis of imposing private calculation rules on civil servants in the pension reform that it is preparing for 2023, the Department of Statistics of the Social Ministries (DREES) has tried to identify the potential impacts of such a measure. Most of the study, which therefore grants civil servants a pension calculated on the basis of the salary of their best 25 years of career instead of the last six months (excluding bonuses and allowances), is dedicated to the generation of civil servants. born in 1958.
If the 25-year calculation rule were applied to them as in the private sector, the pension of these civil servants would be on average 1.5% higher than what they would have received under the current rules. In other words, “there would be no manifest inequity at the global level, despite the differences in the calculation methods between the regimes”, summarizes the Drees.
“Individuals with the highest pensions are mostly losers”
However, “the impacts would be highly variable depending on the individual and in particular according to their initial level of pension”, the authors of the study clarify. 62% of the officials of the generation of 1958 would thus be winners, while 32% would be penalized and 6% would see their pension unchanged at more or less 1%. More specifically, a large third (35%) of the civil servants of the generation of 1958 would benefit from an increase in their pension of more than 10% with respect to the current calculation rules. By contrast, 13% would see it fall by more than 10%.
“People with the highest pensions are mostly losers, while people with pensions in the middle brackets are often winners,” according to the DREES. In addition, the standardization of the calculation rules would benefit more officials whose remuneration is largely made up of bonuses.
Increase in contributions
In general, “the transition of public servants to the rules of the private sector would rather tend to reduce the pension gaps” among public servants. But by changing the calculation rules, the level of retirement contributions paid by public officials would be “modified upwards.” On average, public servants would pay more than 28% in additional contributions, and even close to 40% for those whose salaries are largely made up of bonuses.
Combining the effect of the single calculation rules on the amount of contributions and pensions, the income received by civil servants throughout their lives would fall by 0.7% on average. Finally, the DREES studied the impact of standardized slide rules on the generations born after 1958.
She concludes that the generations of the late 1960s and early 1970s would be “relatively more favored”, as opposed to later generations. The Government has been consulting with employers, employee unions and civil servants since October with a view to a pension reform that it intends to present in early 2023.
Source: BFM TV
