With each new French national election, the question of Social Security reform rears its head. Admittedly, the Social Security account has been in deficit for many years and finding a way to balance its funding is a headache for those responsible for its management. However, though the deficits in the general account have been falling continuously since 2010, Jacques Bichot does not see that as providing evidence of a return to financial health, since the funding and management systems of the French Social Security system have become warped over the years.
After demonstrating the “absurd” state into which France’s Social Security system’s accounts have fallen, Jacques Bichot suggest that its operation should be revised by restoring to it the status of social insurance in the strict sense, a status it has lost over time due to the Welfare State’s interference in its management. He proposes seven basic principles: the insurance-style, financial nature of Social Security should be guaranteed; it should be returned to independent management and responsibility should lie with those who run it; the schemes for different categories should be superseded by a system of universal cover; the rules on pension rights should be brought into phase with reality; it should be allowed scope to use revenues from capital to finance investment in youth (though not in pensions); Social Security should be governed by a transactional logic once again; it should be made explicit that the contributors to, and beneficiaries of, the scheme are individuals, not companies. On the basis of these principles and the restoration of the scheme’s managers — whom the state would no longer seek to override — Social Security could, as Bichot sees it, recover the foundations of fair and financially balanced operation.