France’s Court of Auditors issued a stark warning over the sustainability of the country’s social security system, stating that spending spiralled “out of control” and a liquidity crisis could jeopardise benefit payments by 2027, according to Politico.
The report, published on 26 May 2025, highlights a €15.3 billion deficit in 2024 and projects a worsening shortfall of €22.1 billion in 2025, though auditors caution even this figure is overly optimistic, relying on disputed growth forecasts and savings from tax cuts.
Court President Pierre Moscovici underscored the urgency in a radio interview:
We need to take back control. Over the past years, especially in 2023 and 2024, we have lost control of our public finances.
France’s overall budget deficit reached 5.8% of GDP in 2024, far exceeding the EU’s 3% limit, with the government pledging gradual reductions to 5.4% in 2025 and 3% by 2029. However, auditors argue these targets hinge on unrealistic assumptions, including 1% GDP growth in 2026 and €15 billion in annual savings from yet-to-be-implemented reforms.
The report follows last week’s IMF recommendations urging France to curb social spending and deepen pension reforms, aligning with broader calls for fiscal consolidation. The IMF emphasised that “significant additional fiscal efforts” are needed to stabilise debt, which is projected to rise until 2030 under current policies.
Auditors proposed specific measures to rein in costs: reducing employer contributions, limiting paramedical costs, and pension system overhaul.
France’s social security system, which funds healthcare, pensions, and family benefits, is strained by an ageing population and stagnant productivity. The country’s tax-to-GDP ratio limits revenue-raising options, necessitating spending cuts in politically sensitive areas.
