The French Mandatory Occupational Pension Scheme: History and Properties of a Point System

Frédéric Gannon (1, 2) , Florence Legros (3, 4) , Vincent Touzé (2)

1 EDEHN - Equipe d'Economie Le Havre Normandie
2 OFCE - Observatoire français des conjonctures économiques (Sciences Po)
3 ICN Business School
4 CEREFIGE - Centre Européen de Recherche en Economie Financière et Gestion des Entreprises

This chapter deals with the French PAYGO mandatory occupational pension scheme for the private sector workers (AGIRC-ARRCO), one of the world’s oldest pension point systems. In a first section, we trace the history of the setup of this system which relies on a particular mode of governance (joint administration by trade union and employers’ respective representatives). The second section is dedicated to the analysis of the tax distortion properties of the calculation rule of this defined contribution supplementary pension system. We also discuss the similarities with the German and Swedish pension systems. Weakened by the 2008 economic crisis, this jointly administered French supplementary pension scheme had to undergo a severe adjustment in “emergency mode” (Turner, Social security financing: Automatic adjustments to restore solvency, Washington, DC: AARP Public Policy Institute, 2009), in October 2015. We detail this agreement and show how it restores medium term balance and enacts the principles of sustainable governance.

Mots clés: French supplementary pension system; Contributiveness; Tax distortion properties; Generational impacts

Domaines: Sciences de l'Homme et Société

Frédéric Gannon, Florence Legros, Vincent Touzé. The French Mandatory Occupational Pension Scheme: History and Properties of a Point System. Marta Peris-Ortiz; José Álvarez-García; Inmaculada Domínguez-Fabián; Pierre Devolder. Economics Challenges of Pensions Systems: A Sustainability and International Management Perspective, Springer International Publishing, pp.211-233, 2020, 9783030379117. ⟨10.1007/978-3-030-37912-4_10⟩. ⟨hal-02521185⟩