French parliament approves rail operator reform Bill

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 in the National Assembly, where Mr Macron’s République En Marche party has an absolute majority, was largely a formality after a committee of the lower house and the senate agreed joint amendments to the legislation on Monday.

The senate upper house will approve the Bill on Thursday.

It represents the most fundamental reform of the 150,000-strong SNCF since rail nationalisation in the 1930s, and Mr Macron has overcome a challenge that defeated previous administrations.

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Conservative prime minister Alain Juppé had to withdraw welfare reforms in 1995 after weeks of strikes and social unrest led by rail workers.

Corporate responsibility

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

At the same time, the government has committed not to sell any of the stock, a move to reassure unions that it won’t be privatised.

"The government has committed itself to our rail industry as no other has before us," transport minister Elisabeth Borne told FranceInfo radio on Tuesday. "I now urge the unions to take stock of their responsibilities."

The government has also said it will write off €35 billion of the SNCF’s €47 billion of debt, giving the company more room to manoeuvre and prepare for greater competition from other European operators.

Rail unions

France’s rail unions have been staunchly opposed to the reforms. In April they began three months of rolling strikes in protest, shutting down local, regional and international services for two days out of every five. Those stoppages are set to run until the end of June.At the start, the public expressed some sympathy – polls showed more than half of those surveyed thought the strikes were justified – but support has waned over time. Commuters have grown fed up with the disruptions and found ways around them, using car-sharing apps, telecommuting or cycling to work.

Gaps in the unions' position have also emerged and been exploited – a tactic Mr Macron used to sound effect last year in securing the backing of the largest union, the CFDT, for reforms to the labour code to make hiring and firing easier. – Reuters