Reform or Perish

By Aristotle Vossos

Image: Reuters / Stephane Mahe

Little besides the SNCF strikes has been discussed in the French media lately. Paris has been flooded by over 150,000 people demonstrating in the streets, and 36 days of “grèves” have been announced throughout the next three months. While the current government reforms are far from perfect, they are changes that the ailing SNCF is in serious need of.

What’s going on?

First of all, let’s look at the situation. The current protests are due to the French government’s proposed reforms of the SNCF, particularly regarding the ‘”cheminot” status that most SNCF workers benefit from. What does this mean? The workers benefit from a contract for life, possible early retirement at 52, free travel for themselves and their families (or travel at a very reduced price) and 28 vacation days (three days more than the legally mandated 25). Furthermore, their average salary is around €3,100, slightly higher than the national average. These seem far from being abhorrent work conditions, so why are they protesting?

The protests center around a proposed reform by the government that would effectively do away with the cheminot status, having so far not proposed an alternative. However, this would only affect any new recruits, meaning that all current workers (the same ones protesting) would not be affected. The reforms would also eventually lead to some restructuring and privatization of the rail sector, which the government has argued is necessary for the SNCF to continue functioning. The railway company is currently over 45 billion euros in debt, and French trains run at a cost one-third higher than their European counterparts. Moreover, a current EU agreement would force countries to open up their rail systems to competition by 2020. Without reform, the government argues, the SNCF will not be able to continue to function for long.

Several recent polls have put public support for the government reforms at over 70%. A recent poll in Nice Matin found 65% in favour of the reforms and 33% against. In that same poll, 43% of respondents were opposed to the protests while 34% were in favor, and 22% indifferent.

My take

This is not the first time that the French government has attempted to reform the SNCF. Previous reforms, regarding the retirement age, failed in 1953 after equally disruptive protests, and in 1995 another batch of reforms failed after protests and led then-Prime Minister Alain Juppé to resign. In my opinion, the SNCF is a ticking time bomb that will eventually go off. The current situation is partly a result of the government’s failure to implement previous reforms. If it fails again, the next time reforms will not be a choice but a necessity. And they could be much harsher than the currently proposed ones.

On the one hand, the cheminots make some valid points. The French government is attempting to push through this reform by executive order, which worsens their position with the protesters, some of which have argued that this is not in the interest of public dialogue. Furthermore, much of the anger surrounding these reforms is over uncertainty. The reforms would get rid of cheminot status, but they have not elaborated on its replacement, leaving many to believe this this might just be the start. Though they may not be affected now, further reforms in some years could cost them their jobs, as was the case in the 1990s with what is now La Poste and Orange.

On the other hand, maintaining the status quo is not an option. The SNCF is in great debt (over €45 billion, as previously mentioned) and two-thirds of SNCF trains are operating at a loss. In France, 48 trains run daily on each kilometer of rail, compared with 140 in the Netherlands and 119 in Switzerland. Furthermore, 50% of the trains run on just 9% of the tracks. In short, the French system is not efficient. While the government reforms do not claim to solve all of these problems, they are a start.

I also believe that the current backlash towards the reforms is a result of larger issues in France. The French “code du travail” is immensely restrictive and makes it very difficult, at least relative to other European countries, for companies to hire and fire workers, or even change their contracts. This leads to workers greatly valuing contracts such as the ones offered to the cheminots, which are effectively for life. This leads to situations, such as the current one, where those “on the inside” fiercely resist any changes that would weaken their position.

France has to open up its rail system by 2020, and if SNCF cannot compete profitably with any possible newcomers, it may soon find itself operating at an even bigger loss, eventually becoming too indebted to continue functioning. Though no worker in any position would want to lose their benefits, in this case there is no better alternative. If SNCF is not reformed properly and swiftly, it cannot continue to function.