The financial situation of Agirc-Arrco, the supplementary pension scheme for private sector employees, is getting more complicated. Due to the health crisis, the joint body co-managed by employers and unions has asked the government to be able to obtain a loan of around 8 billion euros to honor the payment of pensions for the next installments of June and July.
In a letter dated Wednesday May 6, that The world was able to consult, the president (CFDT) of Agirc-Arrco, Jean-Claude Barboul, and his vice-president (Medef), Didier Weckner, address this request to the Minister of Action and Public Accounts, Gérald Darmanin.
A need for 8 billion euros
To justify their approach, they point out the impact of the measures taken by the government to avoid the multiplication of business failures: deferral of social contributions and massive deployment of short-time working – a system where the benefits paid are exempt from deductions for pensions .
As of March, these measures led to a fall in the plan’s revenues, generating “Significant additional funding needs” for the following months. Mr. Barboul and Mr. Weckner, who recalled that the fund pays 7 billion euros in supplementary pensions each month, explain that after the settlement of the amounts due for May, Agirc-Arrco ” will have (…) mobilized almost all of its cash reserve ”. “For the next two deadlines, in early June and early July, the overall additional financing need is estimated at 8 billion euros”, they say.
To cope with shocks, Agirc-Arrco certainly has significant financial reserves: they amounted to 65 billion euros in 2019. But M. Barboul and M. Weckner consider that it is not appropriate to use them right now.
Agirc-Arrco’s financial reserve is made up of bonds and stocks, the value of which has, in some cases, plummeted in recent weeks
“In the current context of the financial markets, a divestment of the long-term managed reserve of the Agirc-Arrco scheme, to cover its additional cash requirement, would be carried out under very unfavorable conditions”, they argue. An allusion to the fact that this “mattress” is made up of bonds and stocks: some of them have seen their value plummet in recent weeks, due to the crisis linked to the epidemic of Covid-19 . If the reserves were used, “That would force us to sell off cheap titles”, sums up Pierre Roger, in charge of retirement pensions at CFE-CGC.
You have 43.03% of this article to read. The suite is reserved for subscribers.
–
