French Senate Reinstates Key Social Security Budget Measures to Address Deficit

The French Senate has reinstated several controversial measures in the 2026 Social Security budget that had been previously removed by the National Assembly. These include a freeze on the Social General Contribution (CSG) scale for retirees and unemployed individuals, as well as a tax on health insurance contributions (mutuelles).

The one-year freeze on the CSG contribution rate, which affects replacement incomes such as pensions and unemployment benefits, is expected to generate approximately €300 million in 2026. However, this measure will result in some retirees and unemployed moving into higher CSG brackets, thereby increasing their payments. For instance, a retiree with a gross monthly pension of €2,700—considered their sole income—would see their monthly contributions rise by €46.

In addition to the CSG freeze, the Senate reinstated a tax on health insurance contributions, projected to raise about €1 billion in 2026. The combined effect of these measures aims to reduce the Social Security deficit from the €24 billion level approved by the deputies to around €15.1 billion.

These decisions were led by a coalition of right-wing and centrist parties in the Senate, with Centrist rapporteur Élisabeth Doineau stating, “It's not a choice we take pleasure in, but we must face it with courage... we are at such a deficit that we must consider this.” Minister of Labor Jean-Pierre Farandou supported the reinstatements, emphasizing the necessity to restore a sustainable economic balance within the budget.

The left-wing opposition has strongly criticized the reinstatements, arguing they disproportionately target vulnerable groups such as low-income retirees and unemployed individuals. Socialist Senator Bernard Jomier described the measures as politically aimed against the modest and precarious.

While the Senate agreed to reinstate these key budget items, it rejected a government proposal to impose taxes on meal vouchers and vacation checks, which would have generated an additional €950 million. Another compromise included extending a tax deduction for overtime work to larger companies, expected to cost €130–140 million. The left secured a minor concession with an amendment requiring social contributions on salary supplements exceeding €6,000 annually for workers earning over three times the minimum wage.

Negotiations will continue between the Senate and the National Assembly through early December to finalize the Social Security budget for 2026.