2018 03 – News From France

Froggy

Reforming the railways

Macron had a great victory last year, with the reform of the Labour Code.  But some people still escape the consequences of this reform: civil servants enjoy rights over and above the new norm, such as job protection.

Macron complained that the civil servant statute had not changed since Maurice Thorez.  Maurice who?  asked anybody under the age of sixty.  Maurice Thorez, the Communist minister who, in government in 1947, set up the statute of civil servants.

Another privileged category is the railway workers.  Macron is keeping teachers and the other middle class civil servants in reserve for the moment, and is gunning first for the railway workers.

But there are 190,000 of them, all bar 30,000 with this protected statute.

How do you get rid of them? Have a general campaign against the SNCF.

Say that the SNCF is making a loss, and it’s the fault of the costly privileges of the employees. This is laughable, comparing the cost of free tickets (a million euro?) with the cost of building TGV lines (several billion).

The second line of attack is that SNCF, following EU directives, must open itself to competition.  The government does not even believe in this.  The opening of competition of the freight arm of the SNCF has been a catastrophic example. Operators other than SNCF carry 40% of freight in France.  SNCF has shed employees and material on a vast scale.  But not only does it still make a loss in this sector, but the new operators do too.  (As long as road transport does not pay its share of the social cost of transport, this will remain so.)

Over the Channel in England, franchises are failing but are made to continue for want of an alternative.  The French are not calling for franchising, but open access for competitors, meaning they would use the same lines as the SNCF; they admit however that would be difficult, as there are many lines and stations that are already saturated and couldn’t be shared.  But ‘opening to competition’ is used as an argument for reducing conditions of service: employees mustn’t be so expensive; otherwise no one will want to take them on. So the campaign started as follows.

Macron commissioned a report from a certain Spinetta, previously head of Air France. The Spinetta report then recommended turning the SNCF into limited liability companies, cutting unprofitable lines and changing the employment statute of railway workers, removing their ‘privileges’.

Four days after the report came out, the Prime Minister met the top executives of SNCF to set out the plan. Separately, but on the same day, the minister of transport, Elisabeth Borne, received, one after the other, the leaders of the four rail unions. These four unions have political differences which they have to overcome if they want to act as a front.

Previously, the government let the SNCF accumulate debt while holding back funds, letting the service deteriorate, allowing serious and long lasting breakdowns as well as accidents, the top executives remaining in post all the while, and the reputation of the service going downhill.

When there are breakdowns, cancellations and lateness, it is the visible employee who is on the receiving end of the frustrated passengers, as the Spinetta report recognises; they are the SNCF, even if they are not the ones who cut the number of posts or withheld resources.  It is those same now unpopular employees who will be on the front line defending the service as a public service. Of course the unions were the ones warning about the effects of cuts in budget.

The Spinetta objective is to reduce the debt; the various methods are: concentrating on lines that are used a lot, that is the fast long-distance trains (TGV, Train à Grande Vitesse), and commuter trains; at the same time cutting lines that are little used and replacing them with buses.

Lose several thousand staff over the next two years through ‘voluntary redundancies’. The example of Orange is given as one to follow.  But the example of Orange was an awful one. There were not enough spontaneous candidates for departure, so management deployed psychological pressure to get results, and there were a number of suicides. That Spinetta gives Orange as an example of good management seems very insensitive, to say the least.

Change the status of new entrants to the railway industry to a less favourable one. Thanks to the new Labour Code, pushed through legislation by decree last year, pay and conditions can be negotiated at branch level not sector level; in the case of the SNCF, the State will no longer be involved in these negotiations.

The assumption running through the Spinetta report is that, in a monopoly, staff have no incentive to be efficient. The report ends with nice words about the railway workers’ dedication to their work, about their knowledge and expertise. But the report implies that they are not efficient. They have it too easy.

These new conditions are necessary both to save money now, and to prepare the opening of the industry to competition. No one will want to bid for a railway line if it’s not profitable. But where is the problem there? The European Commission demands that the SNCF opens to competition, as the other European countries have already done, but it can’t make it happen. Since competitors will pick profitable lines and leave aside the non-profitable ones, which still have to be run somehow, competition does not solve the financing problem.  When the SNCF has a mixture of popular and unpopular lines, the popular ones help finance the others, which can’t be done if they are no longer available.

One more worrying thing about the Spinetta report is that is takes British railways as a model, which now, he says, thanks to competition, have more traffic and better service, and are less of a drain on the public purse.

But Spinetta had also explained that the increase in traffic has occurred in unreformed France as well. With the end of industrial jobs, and service jobs concentrated in towns, the population commutes. On the other hand, high speed trains have completely replaced planes for businessmen on trips of up to 300 km.

Spinetta also says that all European governments pay 40% of railway costs, and, incidentally in a footnote, he mentions that the wage bill increases with liberalisation. As for quality, who is to decide what that is?  Companies like Southern can’t be doing much for the ‘arriving on time’ and ‘no cancellations’ British statistics.

Railways cost money, much more than fares can pay for.  90% of journeys are made by car (and 90 % of freight is carried by road).  People invest vast amounts in the purchase and running of their cars, plus they pay road tax.  The state on the other hand must subsidise trains, and it is inconceivable that it should stop doing it. If everyone commuted by car, for example, there would be an environmental and social disaster; the state must therefore provide funds.

 

The opposition

If the railway workers (they are called ‘cheminots’, and Spinetta uses that friendly name) protest against the whole project, they will be accused of selfishly defending their own interests. The population are attached to the national railways but may have little sympathy for the privileged defending their status. The main privilege actually is the right to security of employment, and incremental wage increases. They do have the free rail travel granted to the railway employee’s family, including in-laws, in the form of a certain number of free tickets per year, four in the case of in-laws. Otherwise cheminots have health care on a par with other public or private employees, and work a 35-hour week. In the case of long distance shifts, allowances cover their absence from home.

There is an anti-cheminots campaign beginning, for example a well-known journalist appeared on TV to remind the public that the railway workers are no longer the Resistance heroes decorated in 1945 for their part in the liberation of France.  It was found out that they were part of the machinery of the Holocaust, as the head of the SNCF admitted with apologies, in California in 2011. (This apology was a condition for contracts for the sale of French trains in America.)

Despite all these tactics, a week after the launch of the report, the government is taking no chances, and suggests pushing through these reforms by decree, as it did the Labour Code, avoiding prolonged discussions and possible unrest.  The Prime Minister (whose name few people know, but it’s Edouard Philippe) said in a speech later that same week that he would not follow Spinetta in cutting lesser-used lines, but that the debt carried by the SNCF was equivalent to the French Education budget, 50 billion.

According to him French trains cost 30% more than other European trains, and that’s due to the privileged statute of the cheminots.  Lots of free tickets do not amount to billions, as said above, but anyway he is also not comparing like with like. Take the example of England. Unlike France, Britain has not built High Speed Lines and is therefore not burdened by that cost; there is one planned (HS2), costing 50 billion, and one already built (HS1, access line for the Channel Tunnel), and partly funded by private investment. Besides, private companies run railways in Britain; they are subsidised by the state, but costs can be made to appear or disappear from the national debt with clever accounting; what appears or does not appear on national balance sheets is a mystery, once the private sector is involved.

It is to be hoped that the unions will expose these figures, and not just make general statements, however valid, about defending public services.  People want to know about costs.  The unions should use arguments that demolish the case made by the government re costs. For example, a management consulting group, the Boston Consulting Group, has built a comparison tool for European rail systems. This tool included: number of passengers, tons carried, quality (reliability, price, speed), security and cost to the public purse.  In 2012, this tool placed France second in Europe, after Switzerland. It is only seventh now. The group points to lower investments in France compared to other European countries, contrary to claims. It is studies like that that strengthen the unions’ case.

Where is the opposition in all of this?  Who is providing the alternative analysis and proposals?

The right wing agrees with the reform, and anyway is in a bitter internal dispute after a scandalous lecture by one of its leading lights, Laurent Wauquiez.  Otherwise, there is no opposition capable of mobilising the masses, and none apparently able to grapple with the Spinetta report and say what is wrong with it in detail. Mélenchon (“Non submissive France”) is busy with a campaign to stop nuclear power in France; in his spare time he is arguing with Pierre Laurent, head of the CP, about making an alliance or not.  The CP is embroiled in the preparation of its next Congress in November.  The Tours Congress in 1920 had created the CP out of the Second International.  There is talk of preparing a ‘reverse Tours Congress’, that would disband the CP altogether.

The National Front is a shambles. After its vigorous campaigns for the presidential and subsequent general election, its meagre result of 8 parliamentary seats (Macron’s outfit has 308) and the switching off of the media spotlight, there were serious defections: the star politician Marion Maréchal Le Pen resigned, and so did Marine’s left hand man Florian Philippot.  His line had prevailed during the campaign; the party had stressed national sovereignty, leaving Europe and the Euro, protectionism, reindustrialisation, as well as the political similarity between the all-liberal main parties. Without him, the party is floundering and finds it difficult to find its way again.  It could just revert to its traditional anti-immigrant plank.  Marine Le Pen wants to change its name at the next congress in March. Marion Maréchal Le Pen was back in the news; she went to America to speak at the Conservative Political Action Conference (CPAC), in Maryland on 22 January, on the same platform as Mike Pence, Nigel Farage and Donald Trump.

Nevertheless eventually French radio quoted the National Front’s opposition to the rail reform.  The media love the National Front, and anyway the support of the National Front is not a good thing for the cheminots.  But the other political groups are really inaudible.

 

Miscellaneous

Froggy cannot end without mentioning the annual international Agricultural Show in Paris which opened at the end of February.  Macron prepared his visit by inviting a thousand young farmers to a buffet at the Elysée Palace the day before, to ensure a friendly reception when he attends the event.  This is the same tactic as last year when, before attending the annual congress of Mayors of France, he had invited a thousand mayors to a buffet.  You can’t accuse Macron of not working on his popularity. When Johnny Halliday died, he made a very sentimental speech in the direction of the provincial mourners who had come to Paris to pay their respects.  It was well received.

There is every chance that the reform of the railways will go through, and Macron’s toughness won’t be held against him. The cheminots, 190,000

of them, are the last bastion of ‘non flexible’ workers: trained, well rewarded, with a secure profession, with the expertise that is best used as part of direct labour, rather than outsourced, and part of a proud historical entity.  The government is determined to do away with them over the next twenty to thirty years, starting with new entrants.

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