PARIS, June 17 (Reuters) - France's rail services were hit by a strike for a seventh day on Tuesday as parliament began debating a law on the future of the sector that unions fear will erode working conditions at the state monopoly.
The strike has disrupted transport throughout the country, caused traffic jams in major cities and has already cost between 80 million and 100 million euros ($109-$136 million), according to state railways company SNCF.
Union sources told Reuters the strike - the longest of its kind in years - would continue on Wednesday, despite signs of weakening resolve, with 14.1 percent of workers participating on Tuesday, down from 27.64 percent a week earlier.
Parliament is debating a bill that would bring SNCF and the track owner, RFF, under the same holding company, but with separate operations, a restructure aimed at easing European Union moves to inject more competition into EU rail networks.
Prime Minister Manuel Valls has said the government would not break the strike, but would not scrap the reform that he called necessary and overdue.
"The government is open to dialogue. It believes the reform is indispensable. It considers that the French have the right to a public service that functions," Valls told lawmakers in the National Assembly.
"It considers that the right to strike is a constitutional right but cannot be taken under conditions that today are incomprehensible for the majority of our citizens."
The Socialist government hopes it has the public on its side. Only 34 percent of voters said they understood the strikers' demands and 76 percent oppose the strike, a Harris Interactive poll found on Tuesday.
Thousands of rail worked gathered in Paris to call on parliament to change its tack. At the busy Montparnasse station, hundreds of them blocked the tracks and threw smoke bombs, while, in the northern city of Lille, about 200 strikers briefly forced their way into the town hall to demand the support of the mayor.
The CGT and SUD unions, which had called on parliament to postpone debating the bill during the strike, want SNCF and RFF to be fully merged into one entity, as they were before 1997 and want the state to take on 40 billion euros in debt owed by the companies. ($1 = 0.7345 Euros) (Reporting By Alexandria Sage; Editing by Robin Pomeroy)