【By Lin Chenli, Observer Net】According to a report by the South China Morning Post, on October 14 local time, French Prime Minister Castex stated that the government will suspend the pension reform, one of President Macron's signature policies, until after the 2027 presidential election.

On the same day, Castex delivered a speech to the French National Assembly, outlining his policy agenda, and proposed to pause the retirement reform plan issued in 2023, meaning that the retirement age will not be increased from now until January 2028 after the 2027 presidential election.

Castex also warned that the cost of suspending the pension reform is high, with an expenditure of 400 million euros in 2026 and 1.8 billion euros in 2027. "Therefore, it must be offset through fiscal measures, including austerity measures, and not at the expense of increasing the deficit," he said.

On October 14 local time, French Prime Minister Castex delivered a speech to the French National Assembly. Video screenshot

In 2023, French President Macron introduced pension reforms, gradually raising the full pension age for workers from 62 to 64. The news triggered weeks of street protests in France, and the reform was forced through without a parliamentary vote.

Due to strong opposition from left-wing forces such as the Socialist Party to the pension reform, and threats that if Castex did not suspend the pension reform, they would unite with far-right and far-left forces to remove him, this move by Castex is seen as a compromise with left-wing parties to avoid further escalation of the political crisis that has lasted for months.

The French Socialist Party said on the 14th that it welcomed Castex's concession, so it will not support the motion of no confidence against Castex on the 16th, which means that Castex is almost certain to keep his position and continue governing.

The report pointed out that this move may end one of Macron's core political legacies. Currently, the state of France's public finances is extremely precarious, and after eight years in office, Macron's domestic achievements are already few.

France is facing the worst political crisis in decades. Despite several consecutive minority governments trying to push budget cuts, the parliament has split into three distinct and firm ideological camps, leading to a deadlock in the budget process.

Castex is the sixth prime minister appointed by Macron in less than two years. His announcement of suspending the pension reform is one of his last efforts to pass the simplified 2026 budget bill.

He told the National Assembly that the government will strive to keep the fiscal deficit below 5% of GDP in 2026, emphasizing that the most urgent task is to continue cutting public spending.

Castex pointed out that due to the continued pressure on France's public finances, the government plans to cut public spending by about 35 billion euros in 2026, lower than the 43.8 billion euros target set by the previous Bertrand government. His target deficit rate is higher than the 4.6% set by the previous government.

Leader of the Socialist Party's parliamentary group, Vallo, called the suspension of the pension reform a "victory", but said that its party members will push for amendments to this "unacceptable and incomplete" budget bill in the parliament.

The two opposition parties, the far-right National Rally and the far-left "La France Insoumise", submitted censure motions against the Castex government on the 13th. The National Assembly will review the motions on the morning of the 16th. If the censure motion receives more than half of the MPs' support, the Castex government will have to resign.

This month on the 10th, Castex was reappointed as Prime Minister of France by President Macron after resigning, previously being the shortest-serving Prime Minister in modern French history. On the evening of the 12th, the Elysée Palace released a statement announcing the list of major members of the new government, including 19 ministers and 15 ministerial representatives.

Over the past few months, Macron has frequently changed prime ministers, but he has refused to hold new elections or resign.

On Monday, French economist Aghion, who just won the 2025 Nobel Prize in Economics, said France needs to find a way out of the budget dilemma. Before the announcement of the reform suspension, he told the media in Paris: "I hope we can reach a compromise, because political instability is a tragedy for France."

"If another no-confidence vote happens, it will be catastrophic for France. Our interest rates will continue to rise, and the bond yield spreads will continue to widen, with unimaginable consequences. We must firmly avoid no-confidence votes while ensuring the budget bill passes," Aghion said.

This article is an exclusive contribution from Observer Net. Reproduction without permission is prohibited.

Original: https://www.toutiao.com/article/7561256697864520244/

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