Hollande flags French welfare reform talks for July

PARIS Thu Jan 17, 2013 3:40pm EST

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PARIS Jan 17 (Reuters) - French President Francois Hollande said on Thursday he wanted employers and labour unions to start negotiations later this year on reform of the retirement pension system and welfare finances.

Pension reforms including a rise in pension entitlement age sparked massive street protests during the time of President Nicolas Sarkozy. Hollande is keen to pursue a less coercive strategy than the man he unseated in an election last May.

Hollande, France's first Socialist president in 17 years, hailed a deal that unions and employers hammered out last week on labour law changes. He said a similar negotiation should be used to broach welfare and pension reforms, starting in July.

"The same process should be used to work out how we can safeguard the future of retirement pensions and our system of welfare protection," Hollande told business and union leaders.

He cited estimates that the pension system, funded mostly by taxing those in work to pay for those in retirement, would run up a deficit of 20 billion euros by 2020 despite reforms that Sarkozy introduced, including a rise from 60 to 62 in the minimum age at which most people are entitled to a pension.

His government had already flagged the need for a further revamp of the pension system but it was the first time Hollande floated a date by which he wanted unions and employers to get around the negotiating table.

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