President Nicolas Sarkozy will next year press ahead with measures to make people work longer for their pensions to reform France’s cash-strapped retirement system, according to a senior official.

Plugging the deficit in the pay-as-you-go pension system is regarded as a critical test of Mr Sarkozy’s appetite for further economic reforms as he enters the second half of his five-year presidency. There have been fears that reform could be postponed until after the 2012 election.