After being elected on the promise of scrapping right-wing liberal re-forms, the French socialists are softly shifting to a more pragmatic stance.

The privatisation process is the first illustration of this, but the pension funds reform may come next.

Speaking at the Paris Europlace annual conference, finance minister , Dominique Strauss-Kahn, announc-ed that he will very rapidly" resume consultations with unions and professionals on retirement savings schem-es. "It's a matter of not coming back to the previous law situation, nor finding ourselves without any tools of this type," he said, adding "It's in this spirit that the 1997 law will be modified."

A consensus may, however, be hard to reach given the high constraints unions want to impose on the negotiations. After a meeting with Strauss-Kahn at the end of July, the executives' union CGC reminded it was opposed to the "unilateral and optional" characteristics in the pro-cess of starting pension funds, and opposed to "all reliefs ending up in an impoverishment of pay-as-you-go systems".

But compulsory plans without in-centives would be very unlikely to raise employers and employees' en-thusiasm.

Gilles Pouzin"