France: Sarkozy to boost company profit-sharing schemes

President Nicolas Sarkozy on Monday announced plans to boost profit-sharing schemes in all French companies as part of a drive to win back voters angry about the state of the economy. Sarkozy is to give an hour-long interview on French radio RTL Tuesday to defend his economic strategy and reforms to tackle the cost of living — French voters’ top concern — in a bid to claw back some of his lost popularity.

Currently, all French companies of more than 50 workers are obliged to offer some form of profit-sharing, a measure introduced under president Charles de Gaulle that benefits some 10 million workers.

Speaking to factory workers in Verberie, north of Paris, Sarkozy said he wanted to double such schemes over four years, first by offering 20-percent tax breaks to employers, then by making them compulsory for smaller companies too.

Sarkozy also promised the minimum wage would be increased each year on January 1, instead of July 1 at present — a recurrent demand of unions — and that companies who refused to hold annual wage negotiations would be penalised.

He called for the measures to be approved by the cabinet in June and passed by parliament later this year.

France’s biggest union, the CGT, has dismissed the government’s offer, saying that workers would prefer higher salaries — which count towards their pension — rather than a share of profits.

Sarkozy saw his popularity plummet early this year among voters worried about rising living costs and irked by his high-profile divorce and remarriage to ex-model Carla Bruni, and has failed to bounce back.

His confidence rating has fallen to 35 percent, according to the latest IFOP-JDD poll published on Sunday.

Survey after survey shows that the cost of living has replaced unemployment as the number one concern of French voters — with Sarkozy accused of reneging on a central election pledge to boost purchasing power.

Sarkozy admitted last month to making “mistakes” during his first year in power, but reaffirmed his commitment to modernising the French economy.

While admitting his government could have done more to explain its reforms, he faulted high oil and food prices, the strong euro and the world financial crisis for the lack of improvement in living standards since his election.

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