3 Jul 2008

France to cut overseas pension top-up

3:08 pm on 3 July 2008

The French government has confirmed that it will reform the pension scheme which allowed some retirees to get additions if they lived in French overseas territories.

The junior minister in charge of overseas territories, Yves Jego, has told a finance commission that the he plans to set an end to what he calls the excesses of the provision.

Mr Jego says a way has to be found to prevent pensioners from getting an up to 75 percent bonus on top of their pension by moving overseas when they had no previous link to the territory concerned.

The proposed cuts come after several retired top public servants or military staff moved to French Polynesia or New Caledonia to get the top-up.

Last year, France paid out about 450 million US dollars to meet the bonus entitlements of the about 30,000 pensioners in question.

The indexing was introduced in 1952.