Unédic calls on the state to abandon any new deductions from unemployment insurance

France's unemployment insurance agency, Unédic, has called on the government to halt further deductions from its funds, citing deteriorating financial forecasts. The agency anticipates a deficit of 2.3 billion euros in 2026, a figure that includes a significant state levy of 4.1 billion euros. This situation is hindering Unédic's ability to reduce its existing debt.

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Without the state's deductions, the debt would have been 43.4 billion by the end of 2028.

Unédic's financial projections indicate a worsening outlook compared to earlier estimates. For 2027, the agency now expects a surplus of 2.1 billion euros, down from a previous forecast of 2.8 billion. Similarly, the surplus for 2028 is projected at 4 billion euros, a decrease from the 4.8 billion previously anticipated.

These financial pressures come as the government has already planned to withdraw a total of 12 billion euros from the unemployment insurance system between 2023 and 2026. Unédic has also been tasked with partially funding the operations of France Travail and absorbed 18 billion euros in emergency measures implemented during the COVID-19 pandemic.

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The trade unions and employer organizations managing Unédic are alerting to the risks of increased borrowing, in a context of high interest rates, particularly to finance expenses related to past state decisions.

The agency warns that its debt is projected to climb to 61.5 billion euros by the end of 2026, before gradually decreasing in subsequent years. Unédic emphasizes that without state deductions, the debt would have been considerably lower. The management bodies of Unédic are raising alarms about the risks associated with increased borrowing, especially in a high-interest-rate environment, to cover expenses stemming from past state decisions.

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they call for restoring stable and clear long-term financing, to allow unemployment insurance to fully fulfill its role as an economic and social shock absorber, specifically during future crises.

As the government prepares its 2027 budget and seeks cost savings, Unédic is advocating for stable and predictable funding. This, they argue, is essential for the unemployment insurance system to effectively function as an economic and social buffer, particularly during future crises. Unédic points out that much of its debt is a result of external decisions made without consultation with its managing bodies.

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the debt of unemployment insurance results largely from exogenous decisions, without consultation with the managing trade union and employer organizations that ensure its steering, for financing that goes beyond its fundamentals.