Retirees face major burden in 2027 budget

Pierre Madec, an economist at the French Institute of Economics (IFE), estimates that retirees would bear nearly 60% of the 2027 budgetary effort if the government's proposal is adopted unchanged. His analysis focuses on how the financial burden of the budget plan would be distributed among different household types.

Key measures target retirees

According to Madec, retirees would be the most affected by the planned measures, which include under-indexation of pensions above 1,260 euros per month, capping the 10% allowance on pensions, and freezing the index point of the public sector. Other measures include halting the revaluation of the activity bonus and the monthly base of family allowances, as well as freezing housing assistance and refocusing the school start allowance (ARS).

Under-indexation hits hardest

Madec noted that the under-indexation of pensions is the measure that causes the most losers. This means that pension increases would not keep pace with inflation, reducing the purchasing power of retirees. Other categories of households would also be affected, according to the IFE analysis, which highlights an unequal distribution of the effort required from different population groups.

Debates resume on 2027 budget

On Tuesday, the National Assembly resumed debates on the 2027 budget, returning to the government's proposal after a week of interruption. The interruption was dedicated to examining and then rejecting the social security financing bill, which had previously been a point of contention.

Government seeks public contribution

The government aims to have the French people contribute to contain the public deficit. This effort is part of broader fiscal measures intended to reduce the budget shortfall while balancing the economic challenges facing the country.