Saturday, April 17, 2004

Poverty on rise in France

In 1970, 15% of the French population was officially poor. By 2001, this figure had dropped to 6.1%, which represents 3.7 million people, according to Bertrand Fragonard, president of the National Observatory for Poverty and Marginalization (part of the Ministry of Employment and Labor). But recent news has substantially darkened matters. On April 8, the Observatory released its third annual report which indicated that poverty has been on the rise again since 2002.

Poverty is measured as the share of the population with a monthly income at less than 50% of the median (which was €600 in 2001). One indicating factor in its rise was a 1.4% increase in 2002 of those seeking a form of public assistance complementary to income. In 2003, the increase was 4.9%. This is projected to rise yet again this year due to controversial reforms in unemployment insurance. The report also found that, while there were 85% fewer poor among the elderly than was the case 30 years ago, there were 38% more among employee households, including those who recently had work.

The working poor — persons active for at least six months out of the year and having held down a position for at least a year — number a million but their income has risen following increases in the minimum wage, property tax reforms, universal health coverage, the reform of housing subsidies and employment premiums.

According to Fragonard, the High Council for Employment, Income and Costs (CERC) estimates that one million children are cared for by families living under the poverty line. Without public assistance, the number of households living poverty would rise to 13.1% The income of the poorest 10% is comprised of at least 50% public funds. Yet increases in the various forms of public assistance, particularly housing subsidies, are insufficient to keep up with rising prices, according to the Observatory.

The report was completed prior to Jacques Chirac's announcement that the planned reform to shorten the duration of the "solidarity" premium — paid to those whose unemployment insurance has run out — would be suspended.

Taken together with a malfunctioning health system, sluggish economy, disastrous public finances, reduced productivity, a delapidated military, scientific research starved of funding, ghastly prisons, stagnant population growth, and faltering race relations, it seems there are a great many emergent causes for unhappiness in France at the moment.

1 comment:

Alex ken said...

These tax professionals do not want to start all over again learning about the tax law changes due to tax reform.

London tax specialist