Infotech APL, RSA, family allowances… these social aids which could increase with the “purchasing power” law

APL, RSA, family allowances… these social aids which could increase with the “purchasing power” law

This is one of Emmanuel Macron’s priorities for this summer. The daily “les Echos”, which was able to consult part of the bill on purchasing power, revealed on Sunday June 26 the content of the first major text of the five-year term, which aims to protect French households from inflation: the government plans to increase a large number of social benefits, including APL, by 4%. “L’Obs” summarizes them below, ahead of the presentation of the text to the Council of Ministers, on July 6th.

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+4% for inflation-indexed benefits

The bill provides that all inflation-indexed benefits will be increased by 4%, retroactive to 1er July, that is to say with a catch-up proportional to the moment when the law is promulgated. Are concerned in particular:

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  • Active Solidarity Income (RSA)
  • Basic retirement pensions
  • The minimum old age
  • The activity bonus
  • Family allowances
  • Disabled Adult Allowance (AAH)
  • Solidarity allowance for the elderly (Aspa).

Basic pensions and the minimum old age were revalued by 1.1% in January. The RSA, the activity bonus, family allowances and the AAH had already been revalued by 1.8% in April.

It is, note “Les Echos”, the most expensive measure of the project with an estimated cost of 8 billion euros. Inflation is expected by INSEE to be 5.5% in 2022, a level not seen since the 1980s. If it were to be lower than expected, the bill does not provide for recovery for overpayment.

Elisabeth Borne had already announced the 4% increase in retirement pensions before the result of the legislative elections, but remained more vague on the amount of the increase in social benefits.

APL revalued by 3.5%, a housing “shield”

Treated separately, housing aid (APL) could be increased from 1er July, up to 3.5% for a cost of 168 million euros, still according to “Les Echos”. Bruno Le Maire confirmed this measure on Monday morning.

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The government is also planning a housing “shield” with a cap on rent increases at 3.5% until the second quarter of 2023, a threshold below inflation. With this “rent shield” a year, a household paying just over 800 euros per month in rent could save 200 euros at the end of 2022.

The government will ask TotalEnergies to make an additional effort on fuel prices

It should be noted, however, that a 3.5% increase in APL, which relates to a lower amount, does not compensate for a 3.5% increase in rent.

Encourage redistribution in the private sector

These increases programmed in the bill “purchasing power” are only part of the measures concocted by the government to respond to rising prices. These are unveiled in dribs and drabs, such as the inflation check, the unfreezing of civil servants’ salaries, the tariff shield on energy or even the tripling and sustainability of the purchasing power bonus. However, the adoption of the text by Parliament promises to be an obstacle course, for lack of an absolute majority in the National Assembly for the presidential camp.

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The bill also provides for a measure concerning the private sector, with an incentive to introduce profit-sharing in SMEs, by authorizing recourse to a unilateral decision in the event of failure of negotiations. The maximum duration of the incentive will also be extended from three to five years.

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Finally, the bill “purchasing power” will make it possible to merge a branch that is reluctant to update its minimum wages despite the latest increases in the minimum wage. One way to encourage the social partners to negotiate wages more regularly.

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