French parliament approves SNCF reform bill in breakthrough for Macron

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PARIS (Reuters) – France's parliament overwhelmingly approved a bill overhauling the indebted state-run rail company SNCF on Wednesday, handing a significant victory to President Emmanuel Macron in his bid to outflank the unions and reform the economy.

The 452 to 80 vote inside the National Assembly, where Macron's Republique En Marche party comes with an absolute majority, was largely a formality right after a committee in the lower house as well as the Senate agreed joint amendments towards legislation on Monday.

The Senate upper house will provide niche on Thursday.

It represents quite possibly the most fundamental reform of your 150,000-strong SNCF since rail nationalization within the 1930s, and Macron has overcome quite a job that defeated previous administrations.

Conservative Prime Minister Alain Juppe needed to withdraw welfare reforms in 1995 after weeks of strikes and social unrest led by rail workers.

The new law will turn the SNCF towards a joint-stock company, giving its management greater corporate responsibility, will phase out its domestic passenger monopoly from 2020 and put a stop to generous benefits and pensions for future employees.

At the same time frame, the federal government has committed to never sell one of the stock, moving to reassure unions which it won't be privatized.

"The government has committed itself to our own rail industry as hardly any other has before us," Transport Minister Elisabeth Borne told FranceInfo radio . "I now urge the unions for taking stock within their responsibilities."

The government also has said it will discount 35 billion euros of the SNCF's 47 billion euros ($55 billion) of debt, giving the corporation more room to go and prepare for greater competition from different European operators.

AN OVERPLAYED HAND?

France's rail unions were staunchly against the reforms. In April they began 11 weeks of rolling strikes in protest, closing local, regional and international services for two main days out of five. Those stoppages are set to run ’till the end of June.

At the first, the population expressed some sympathy — polls showed more than half of the surveyed thought the strikes were justified — but support has waned in time. Commuters have increased sick of the disruptions determined ways around them, using car-sharing apps, telecommuting or cycling to function.

Gaps inside the unions' position in addition emerged and been exploited — a tactic Macron helpful to sound effect in 2009 in securing the backing of your largest union, the CFDT, for reforms to the labor code to produce hiring and firing easier.

The CFDT, quite possibly the most moderate within the larger unions along with the biggest, has signaled it should accept the SNCF bill once it is law. Should the rolling strikes end on June 28, its railworkers are predicted to go back to work.

The more militant CGT union remains firmly against, with 95 % from the members voting up against the legislation a few weeks ago. Employees represented by way of the union have said they should pursue wildcat strikes from July.

But their capability to cause widespread disruption or win public sympathy appears limited. Many CGT unionists are with those which have gradually cast aside sticking with the strike.

For a graphic see https://tmsnrt.rs/2JnAdwO

"I do believe the unions may have overplayed their hand here," said Bob Hancke, a professor of European political economy for the London School of Economics, describing the SNCF as "one of several last bastions of union power in France".

A improvement in public sentiment toward organized labor — portion of a broader social shift as younger people increasingly engage in the 'gig' economy to see the long run in technology — has left the unions looking out of touch.

But Hancke warns that while it is really an important symbolic victory for Macron, it may well do little to increase this company climate in France or stimulate much-needed growth.