A Short Retreat: A Slow Start

The government's promise to increase retirement pensions for the most vulnerable appears to be facing a one-year delay for the elderly. 

Implementing this measure is proving to be more complicated than expected for the National Old-Age Insurance Fund (CNAV). This increase was one of the central elements of the pension reform that will take effect this Friday.
 

The government’s relief measure, which had promised to increase the pensions of the most vulnerable retirees, will not, after all, take effect immediately for seniors. This summer, the National Old-Age Insurance Fund (CNAV) announced that some beneficiaries would have to wait another year to benefit from this measure, according to Les Échos. The complexity of its implementation is the main reason for this delay. The pension reform, meanwhile, will take effect this Friday.
 

Specifically, the government plans to raise the minimum pension to 85% of the minimum wage (approximately 1,200 euros gross) for retirees who have paid contributions based on the minimum wage throughout their careers. This amounts to 100 euros per month in assistance, which was initially expected to benefit approximately 1.8 million retirees starting this fall.
Renaud Villard, director general of the CNAV, stated on France Inter that “retirees for whom we have the most complete information—those who have recently retired—will benefit from this one-time increase starting in September, with the first payment in October.” ” This first wave of increases is expected to affect just over half a million people. However, regarding retirees who retired a long time ago, Renaud Villard clarified: “It will take us more time. We are looking to implement this in the summer of 2024.”
 

The reason is that pension funds will have to reconstruct these retirees’ employment histories in order to increase their pensions, which, naturally, will take longer for those who left the workforce a long time ago. Collecting paper documents is expected to be particularly labor-intensive. The director of the CNAV commented, “This is a massive undertaking, both in terms of IT and administration.” However, he emphasized that the amounts owed will be paid retroactively.