According to an Elabe poll conducted for Les Échos and l’Institut Montaigne, 80% of people in France view reducing public debt as an urgent necessity. This public sentiment sparks a broader debate over whether cutting public spending forces a painful trade-off with public services, or if major state missions harbor deep potential for rationalization and waste reduction.
Targeting State Waste and Régalien Missions
Jean-Philippe Delsol points out that substantial savings remain entirely possible within the core sovereign functions of the state. According to data from France’s Cour des comptes cited by Delsol, urban policy programs have absorbed €10 billion annually over the past 40 years without generating measurable results. Furthermore, a DARES report from July 2023 indicates that a large majority of subsidized jobs simply subsidize hires that employers would have made anyway. State subsidies directed toward associations have similarly swelled past €7 billion annually, climbing by €2 billion between 2016 and 2018.
Yet, Delsol argues that the deeper structural flaw stems from public finances being dominated by social expenditures while core sovereign functions are starved of resources. In France, social spending accounts for nearly two-thirds of all public expenditures, whereas justice, defense, and police absorb a mere 6%. OECD data from 2022 shows that French social spending reached 31.6% of GDP, eclipsing the OECD average of 21.1%, Italy’s 30.1%, Belgium’s 29%, and Denmark’s 26.2%.
Unlocking Savings Through Civil Servant Pensions
Nicolas Marques contends that reducing public expenditures does not inherently conflict with maintaining high-quality public services. Instead, unused structural levers exist across the public sphere that could lower costs while preserving quality. Marques identifies civil servant pensions as the single largest unexploited source of potential savings.
Historical choices led the French state to promise public sector workers pensions calculated on their final index-linked salary, differing from private sector rules. However, unlike private institutions, the state failed to provision these future liabilities by setting capital aside. By contrast, prudent institutional bodies like the Banque de France and the French Senate established capital reserves as early as the 19th century. These entities fund pensions through financial markets, dividends, and capital gains rather than leaning directly on taxpayer budgets.
According to Marques’s recent research, had the state capitalized its pension obligations like the Senate, it would have saved €433 billion over a 15-year span and trimmed its deficit by 30%. If the state had matched the even stricter provisioning model of the Banque de France, savings would have reached approximately €750 billion over 15 years, slashing the national deficit by 50%. Currently, the state budget absorbs a staggering €60 billion annually to cover civil service pensions, highlighting a massive fiscal lever that remains unactivated as public deficits persist.