The deficit of France's social security is unsustainable
France's social security system, which marks its 80 th anniversary this year, has never been in such an alarming state. Despite repeated warnings about the sustainability of its funding, nothing has been done about it. After a slight improvement after the Covid-19 crisis, its deficits have begun to grow once again, while measures to remedy the situation have been slow in coming. In response to the apathy shown by the government, the Court of Accounts, France's public audit institution, has changed its tone. Its report on the "implementation of the social security budget," published on Monday, May 26, speaks of a risk of a "liquidity crisis" it says could lead the system to a "default on payments."
While the alarmist language is unprecedented, the dire state of the social security system's finances is not. The deficit, which was supposed to stabilize in 2024, ended up worsening by nearly €5 billion, and now exceeds €15 billion. Furthermore, it is set to deteriorate further this year, mainly due to an imbalance in the healthcare branch. The €22 billion deficit forecast for the social security budget passed in February already appears difficult to sustain. Despite a few cost-saving measures implemented in 2025, the situation is expected to continue to deteriorate, with the deficit surpassing €24 billion in 2028, if nothing is done.
Until now, France has relied on temporary fixes to endlessly postpone the painful but inevitable measures needed to restore balance to its social security system's finances. The Court of Audit has now warned that this approach is reaching its limits. Starting this year, the CADES, the agency responsible for amortizing the social security system's debt, will no longer have enough resources to fulfill its role. The Central Agency for Social Security Bodies (ACOSS), which is supposed to take over from it, may face difficulties refinancing itself on short-term capital markets, the report noted. To avoid the risk of default, one solution would be to change the law and extend the lifespan of CADES. Yet this stopgap measure would only buy some time, and would not even halt the deficits, which are set to get worse.
The continued widening of the social security system's deficit is unacceptable. France is experiencing neither an economic nor a health crisis. There is, therefore, no justification for tolerating such imbalances, the costs of which will be borne by future generations. There is now a risk that social benefits may no longer be guaranteed. Waiting for this threat to materialize would be utterly irresponsible.
Numerous reports have outlined ways to control spending and increase revenue, but none have been implemented due to a lack of political consensus. Unfortunately, that consensus now seems more elusive than ever. With no majority in the Assemblée Nationale, the government has struggled to make progress on social security funding. It knows that it cannot afford, next fall, to pass a social security budget as unambitious as the previous one, which allowed it to avoid a no-confidence vote. The critical state of the social security system's finances demands that Parliament step up and reach compromises. Even if these measures promise to be painful for the French people, refusing to act for political reasons would expose the country to a dangerous leap into the unknown.
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