Pensions: a heavy deficit of 25 billion in 2020

The deficit of the pension system will plunge to more than 25 billion euros this year, before rising to 10 billion next year and then, in 2024, widening to 13 billion, according to a “Progress note” of the Retirement Orientation Council (COR), press release Tuesday 13 October.

Pension reform: towards a sprint or a retreat?

This document, intended for Prime Minister Jean Castex, refines the forecasts drawn up in June, when the COR forecast an unprecedented loss of 29.4 billion euros in 2020 for all pension plans.

A loss of earnings due to Covid-19 and its consequences (unemployment, massive recourse to partial activity, postponements and exemptions from contributions), which have “A massive impact on the resources of the pension system”.

The deficit would however be “A little less important” this year (-25.4 billion) “Due to a slightly less degraded economy” than four months ago.

Losses that will remain high

The expected rebound of the economy in 2021 should lead to an improvement in the accounts, with a loss brought down to -10.2 billion. This improvement will be short-lived because the balance will then deteriorate to -11.6 billion in 2022, -12.1 billion in 2023 then -13.3 billion in 2024.

A trajectory already traced before the health crisis, which would however cause “A need for additional financing” estimated at “A little less than 5 billion” per year from next year.

This “Progress note” is a prelude to the COR annual report, expected at the end of November and which will serve as a basis for the discussions that the government intends to reopen on pension reform, despite unanimous opposition from the unions.

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