Sarkozy scraps carbon tax as workers stage mass strikes

FRANCE’S government has put a key carbon tax plan on hold as workers held mass strikes over pensions and jobs, turning up the heat on President Nicolas Sarkozy after an election humiliation.

The government shelved the proposed carbon tax, a day after Sarkozy replaced a top minister in a reshuffle after his UMP party’s defeat in regional elections.

Hundreds of thousands of protesters marched in the streets and teachers, train drivers and other public workers stayed off work to protest job cuts and plans for pension reform.

The president has vowed to press on with changes to state pensions. But the carbon tax, a major plank of his environmental policy, was put on hold.

Prime Minister Francois Fillon said the government still aimed to implement the tax but this could only be done “in common with other European countries” and France would push the EU for a common position.

French business lobbies feared the carbon tax would penalise French industry.

The strikes yesterday disrupted train services and schools while angry public sector employees marched in Paris, Marseille, Bordeaux and other French cities, police and organisers said.

France’s biggest union, the CGT, said 800,000 people took part in protest marches across the country, not counting a major march in Paris that got under way on yesterday afternoon. It said 180 marches were planned in total.

Police figures put turnout at half the level, or lower, of that estimated by unions.

“The issue is getting new direction in economic and social policies,” said CGT leader Bernard Thibault, calling on Sarkozy to chart a new course in tackling unemployment and falling living standards.

Francois Chereque, head of the CFDT union, said French workers are increasingly feeling “abandoned” by Sarkozy’s government. “The government must change its methods,” he said.

Many union activists oppose Sarkozy’s plan to raise the minimum legal age for a retirement pension from 60, possibly to 62.

The government argues this is the only way to keep the system of generous state benefits afloat.

On Monday, Sarkozy sacked Labour Minister Xavier Darcos, replacing him with Eric Woerth, the new pointman on pensions reform.

Speaking on television Tuesday, Woerth promised a “fair” reform of what he called France’s “extraordinarily fragile” pensions system.

Sarkozy was elected in 2007 on promises to boost France’s economy and get people back to work, but last year’s recession has driven unemployment up to 10%, its highest level in a decade.