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A sharp drop in the Social Security deficit expected in 2023


The Social Security budget for 2023 provides for a sharply reduced deficit, to 6.8 billion euros, but the losses of the old-age branch will widen in the following years, according to the draft law consulted on Sunday, September 25. by Agence France-Presse. Since the abysmal record of 2020 (nearly 39 billion) due to Covid-19, the losses have continued to reduce: less than 25 billion in 2021, 17.8 billion this year and, therefore, 6.8 billion expected. in 2023.

These figures, which cover a broader scope than just the general scheme of the Social Security funds, nevertheless confirm the spectacular recovery of the accounts, first thanks to growth, now with the help of inflation.

The rise in prices, and in its wake that of wages, indeed boosts contributions, which will result in 2023 in a jump of 4.1% in revenue, when expenditure will only increase by 2.1%. A situation which will mainly benefit the health branch, whose losses will be reduced from around 20 billion this year to 6.5 billion in 2023.

This result is however subject to caution, as it is largely due to the melting of the bill linked to Covid, which would fall from more than 11 billion to only 1 billion in 2023. However, this provision “Risk of proving to be very insufficient”according to the opinion of the High Council of Public Finances, quoted in the document.

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Budget sleight of hand

The savings measures are beyond measure: the government thus intends to tackle the work stoppages issued by teleconsultation, the cost of which is around 100 million euros, and to strengthen the arsenal against social fraud. A call from the foot assumed on the right before a complicated debate in Parliament.

Added to this is a budgetary sleight of hand, the text providing for the transfer of the 2 billion paid under the “post-natal maternity leave” to the family branch, which would still have a surplus in 2023 and the following years, as would the industrial accident branch. On the other hand, the health branch would not come out of the red, its deficit should continue to be absorbed at a much more moderate pace, to settle at 2.6 billion in 2026.

On an opposite trajectory, the old-age branch could quickly take back the title of“sick man of the Secu”. Yet close to balance this year (- 1.7 billion), it should plunge back to 2.7 billion in 2023 and up to 13.7 billion in 2026.

A balance “particularly sensitive” to “projected slowdown in inflation”because pensions are revalued on 1er January based on the price increase noted the previous year. The anticipated 4% increase in July will certainly limit the impact in 2023, but the backlash will be felt from 2024.

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Reluctance and threats of motions of censure

Caught up by “the demographic effects of aging” of the population, the old-age branch will also be weighed down by a “marked degradation” the system for territorial and hospital civil servants (CNRACL), trapped by the growing use of contract workers. So many elements that should outweigh “the objective of gradually raising the effective retirement age”whose rise observed over the past fifteen years should continue in the short term.

However, the draft bill does not include any pension reform measures, while the executive is considering introducing an increase in the legal age or the contribution period by an amendment during the debates in Parliament in the month of october.

This scenario, however, comes up against reluctance within the majority itself, while the left and far right oppositions threaten to draw motions of censure in the Assembly. The executive nevertheless intends to carry out this reform by the summer of 2023, arguing for the rapid and lasting return of deficits, pointed out in the latest report of the Pensions Orientation Council.

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The World with AFP