Solidarity
France has one of the most effective social security systems in the world. It covers basic needs such as healthcare, unemployment benefits, minimum social benefits, family policy and retirement pensions. The system is based on the principle of national solidarity and it covers all French residents against the financial consequence of life’s misfortunes. It has keep pace with social change and has adapted to meet new needs. The system is encountering financial problems and businesses and households have been called upon to help stabilise the accounts. But the system will have to meet the challenges arising from the fight against social exclusion, changes in family life, the ageing of the population and concern for the interests of future generations.
Georges-Pompidou
European hospital in Paris.
© F. de La Mure / M.A.E.
Social security encompasses retirement pensions, healthcare spending, unemployment benefits, family benefits, housing benefits and expenditures to fight social exclusion, such as basic guaranteed income. These expenditures accounted for 28.5% of France’s GDP in 2001. Social security expenditure has increased two and a half times as fast as the gross national product since 1945. The increase stems from the larger numbers of pensioners and higher pensions, which accounted for 44% of expenditure in 2001. Another cause is the increase in healthcare expenditure, accounting for 34.8% of the total, with the introduction of universal health coverage, longer life expectancy and advances in medical treatments. The decline in employment and the increase in unemployment benefits mean expenditure in this area now nearly matches expenditure on family benefits.
Contributions on income from work are no longer sufficient to finance the system. The social security Generalised Welfare Contribution (CSG) introduced in 1991 and the contribution to the repayment of the social debt (CRDS) introduced in 1996 expanded the contribution base to other forms of income. Consequently, contributions on income from work represented only 66.5% of the social security system’s resources in 2001.
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