Jospin to reshuffle cabinet as popularity declines

Rarely has a French politician fallen from favour so quickly and with so little reason. While the Prime Minister, Mr Lionel Jospin, discusses European employment policy with other heads of government in Lisbon today, his mind will be on his imminent cabinet reshuffle, which could be announced as early as Monday.

Mr Jospin had wanted to keep the government he established in June 1997 until after the 2001 municipal elections, but daily political set-backs have made that impossible. French political commentators suggest that the first day of spring could go down in history as the day Mr Jospin lost the 2002 presidential election.

It is difficult to understand how a popular socialist prime minister could be brought so low by fickle public opinion and ostensibly leftist trade unions, at a time when France is more prosperous than ever. Suffice it to say that Mr Jospin's commitment to reform and financial rigour met the immovable object of the French civil service.

Ever since Mr Jospin caused a furore by unilaterally altering French Middle East policy during a visit to Israel in late February, he seems to have been jinxed. A week ago, he tried to defuse growing criticism by defying European Central Bank directives and handing out £4.8 billion in VAT and property tax cuts - which amounts to about £120 less in taxes for the average French househould next year. The ECB had specified on March 13th that France's windfall revenues should be used to lower the public deficit.

The respite was short-lived. After marathon negotiations with the tax collectors' unions last weekend, the Minister of Finance, Mr Christian Sautter, announced on Monday that, "faced with this blocked situation, in a spirit of appeasement and responsibility, the ministers have decided to withdraw this reform plan."

The plan was intended to streamline France's tax collection system - the most costly in Europe - by placing it under a single administration. At a banquet for King Mohamed VI of Morocco that evening, Mr Sautter was overheard to say he was "mortified" and wanted to resign.

On Tuesday, Mr Jospin announced his long-awaited reform of France's retirement system, which faces bankruptcy in coming decades. The over-cautious Prime Minister delivered a vague plan with no deadlines that few understood, promising mainly to devote profits from state-owned companies to a nationwide fund.

But his call for negotiations with French civil servants regarding their special retirement status immediately led to an outburst by their union leaders - and promises of more strikes and street demonstrations today and on March 30th.

Since the Balladur reforms of 1993, private sector workers must contribute for 40 years to enjoy full pension benefits. But civil servants - whose salaries and pensions account for close to 40 per cent of the government budget - must work for only 37.5 years. This unfair situation must be remedied, Mr Jospin argued.

Once again, Mr Jospin scrambled to limit the damage. His education minister abandoned an unpopular plan to reform professional lycees, and the Prime Minister dropped the freeze on public sector hiring in force since he came to office. The Communist Party was alone in praising him for caving in to street demonstrations which "called the plural left back to its duties". To the rest of the country, Mr Jospin's experience reconfirmed the impossibility of changing anything in France.

Asked about persistent reports that he is about to reshuffle his cabinet, Mr Jospin said: "A cabinet reshuffle is like a devaluation. You announce it after it happens". The finance and education ministers are almost sure to fall, and the environment and culture ministers are also threatened.