National debt: France cuts social spending

Last year, France was short of 21 billion euros in taxes and social security contributions due to the stagnating economy. Now the same amount of expenditure is to be cut. President Emmanuel Macron and his government lean
In principle, tax increases or special levies for corporations with super profits. That’s why the austerity plans focus on social spending and come at a cost of the weakest French. Prime Minister Gabriel Attal’s priority is to reform unemployment insurance. It is the third reform since Macron took office in 2017.

With 5.1 million unemployed, the unemployment rate, which was 9.5 percent in 2017, is currently 7.5 percent. Even if this is still significantly higher than the EU average of 5.9 percent, the government emphasizes that it is the lowest level for France in 40 years. It refers to 2.4 million new jobs created since 2017.

The unemployed cost unemployment insurance and the state budget around 45 billion euros per year. The government sees savings potential here. It is planned to shorten the period for paying unemployment benefits from 18 months today to twelve months in the future and also to reduce the amount of aid to be paid out. Furthermore, the length of time it takes to pay into unemployment insurance until you are entitled to a payment should be extended by several months.

These types of measures are intended to force unemployed people into employment with all their might. Even if they are far from their qualifications. The hope is to fill the approximately 100,000 jobs that have been open for years in construction or in the hotel and catering industry. “If Prime Minister Attal had his way, an engineer who is older than 50 and cannot find a job that matches his qualifications would have to accept a job as a dishwasher in a restaurant,” says François Hommeril, president of the employees and managers union CFE- CGC.

Austerity measures in healthcare

The government is also planning a series of austerity measures in the healthcare system. A “waiting day” is to be introduced in the private sector, on which neither sick pay is paid by the health insurance company nor daily allowance is paid by the company in the event of sick leave. This day has existed in the public service for a long time. The unions strictly reject the plan, “for reasons of public health,” as CFDT national secretary Florence Puget emphasizes. “For example, if someone with an infectious disease goes to work to avoid losing wages, he is not only endangering himself, but also his colleagues or other people,” she explains her stance.

Additional staff should also be hired to track down “welfare fraudsters” or doctors who issue sick notes as a favor. As early as 2023, the “protection fee”, which is levied on medication packages and is not reimbursed by health insurance companies or additional health insurance companies, was doubled from 50 euro cents to one euro. It is intended to encourage patients to use medicine sparingly. A penalty fee is now to be introduced for every doctor’s appointment that a patient has received but not attended. A fine of ten euros is planned, of which five euros each will go to the doctor and the health insurance company. All of these plans testify to a new neoliberal change in economic and social policy. Trade unions and left-wing parties are up in arms against it, but the right-wing opposition and the government camp also have concerns.

Implementation without a parliamentary vote

There is a lack of a majority in parliament for unemployment reform. Prime Minister Attal therefore wants to implement it by government decree and therefore without a parliamentary vote. To ensure that the resistance does not reach proportions similar to the 2023 pension reform, Attal is proposing a working group. This is intended to examine whether companies with inflation-related super profits should be subject to a special levy. This is primarily about energy companies that are profiting from the crisis triggered by the war in Ukraine.