France

Rescaling Social Welfare Policies A comparative study on the path towards multi-level governance in Europe
Rescaling Social Welfare Policies in France

National report provided by Agns Gramain Albane Exertier
Centre dtudes de lemploi
Jean-Michel Herbillon
Institut dtudes politiques de Strasbourg
Noisy-Le-Grand Strasbourg February, 2006
Rescaling Social Welfare Policies
National Report France
Table of contents
Introduction 1 1.1 Changing contexts: demography, economy, society, politics Socio-demographic pattern and trends 1.1.1 Population 1.1.2 Birth rate, participation rates and family composition 1.1.3 Ageing 1.1.4 Educational level 1.1.5 Poverty and inequalities The State, its organization and normative foundation 1.2.1 Social Insurance 1.2.2 Social assistance renewal 1.2.3 The providers of social and social-medical services The Market, commodification and labour market performance 1.3.1 Unemployment 1.3.2 A changing job market Institutional analysis: actors and governance arrangements Identification of the territorial institutions and their developments 2.1.1 The central State, key component of the French system of governance 2.1.2 Subnational authorities: three scales of government 2.1.3 Hierarchy, regulation and division of power 2.1.4 The slow rise of intermunicipal government in France Changing institutions 2.2.1 The slow road towards decentralisation and territorial autonomy 2.2.2 De-concentration and state bureaucracy reform as a consequence of the decentralisation process 2.2.3 Interpreting the decentralisation process in France Resources flows among territorial levels 2.3.1 Sub-national authorities funding autonomy 2.3.2 SNAs resources and charges equalisation (perequation) 2.3.3 SNAs financial frame Horizontal institutions and actors (subsidiarity) at each level 2.4.1 Employment policies 2.4.2 Assistance and inclusion policies 2.4.3 Care policies for older persons The model of regulation: how does coordination take place ? Conclusion The process of rescaling in four policy areas in France Social assistance and local policies against poverty 3.1.1 Several minimum incomes 3.1.2 Social Assistance and working status
3
5 6 6 6 6 7 8 8 8 9 11 13 14 14 15 17 18 18 19 22 23 24 24 26 28 28 29 29 30 32 33 37 39 41 42 43 43 43 45
1.2
1.3
2 2.1
2.2
2.3
2.4
2.5 2.6 3 3.1
3.1.3 3.1.4 3.2
Active assistance Decentralisation of the RMI
46 47 48 48 48 49 52 53 55 56 57 59 59 59 59 61
Care for older persons 3.2.1 Facilities 3.2.2 Geographical disparities 3.2.3 Major recent reforms Employment Policies 3.3.1 Institutional settings of employment policies (and vocational training) in France 3.3.2 A growing need to rely on local initiatives 3.3.3 A rigid, hierarchical model progressively made more flexible and decentralised 3.3.4 The governance issue Appendix Appendix 1: Article 1er de lordonnance du 4 octobre 1945 Appendix 2: CMU Appendix 3: RMI recipients
3.3
4 4.1 4.2 4.3
References
Introduction
Esping-Andersen considers the French social welfare system as a conservative one, even if it is difficult to classify. The social welfare system combines indeed several logics: social insurance managed by the social partners, assistance with the development of social minima, and different private and complementary schemes (rgimes). The proportion of social protection expenditure in gross domestic product (GDP) grew from 19.4 % in 1974 to 27.3 % in 1985, and 30.6 % in 2002 (Eurostat; DREES). The insurance components of the French welfare system is predominant: while the aggregate amount of social assistance benefits totals between 20 and 30 billion, the budget of social insurance agencies comes up to nearly 400 billion The French social insurance reflect the Bismarckian tradition: entitlement is conditional upon a contribution record; most benefits are earning-related; financing is provided mainly by employers and employees contributions; and the social partners are greatly involved in the management of the system (Mandin/Palier, 2002: 32). However, the Scurit Sociale was thought up during the Second World War, as the French government was in exile in Great Britain. Founders were influenced by the Beveridge conceptions and their aim was explicitly to achieve universal and uniform coverage for the whole population. As Bruno Palier summarized:
The hope was that, in the context of full-employment, the difference between a universalist and an employment-based system would be negligible: all the population should progressively be covered by the social insurance system. To some extent, French social reformers tried to achieve Beveridges aims of universality with Bismarcks instruments. (Palier, 2001: 46)
This initial plan explains the weird structure of the French welfare system today, consisting in an accumulation of adjustments made to preserve this original spirit even when the economical situation turns adverse. Changes that occurred in the past twenty years in the governance and provision of welfare in France can be divided in two aspects: amending the balance between State and social partners in social insurance schemes, and rescaling social assistance.
Since the 1990s the original structure of the social insurance system (Scurit Sociale) has definitely been shifting towards more Beveridge type principles: part of strategic decisions was transferred to the parliament, and a universal health coverage, managed by social partners but financed by the State was created. By contrast, the unemployment insurance scheme remained based on a very traditional Bismarckian model. Regarding social assistance, the review of recent reforms reveals the following features: first, an important shift in public spending from the State to the Dpartements, in charge of more than half of social assistance spending now, secondly, the development of a new form of public support for workers, combining income support with the provision of reintegration services.
1
1.1
Changing contexts: demography, economy, society, politics

Socio-demographic pattern and trends
In 2003, the French gross domestic product (GDP) was 1,557 billion. The growth rate (0.5% in real) equals that of the Euro zone average. Household consumption increased by 1.4% in real. France devotes 7.1% of its GDP to education, 9.7% to health care and 2.2% to research. From mid-1997 (start point of the current cycle) [to 1998], the French economy has enjoyed regular growth of close to 3%-3.5% per year, between 2.5% and 3% per year in the second half of 1999 and the first quarter of 2000. [] The shape of French growth marks a break with the disappointing figures recorded throughout most of the 1990s. Growth has been rising slightly above potential, traditionally estimated at between 2.5% and 3% per year (Vernet, 2000: 60).
1.1.1
Population
As of January 1, 2004, France had 61.7 million inhabitants; making it the twentieth most populated country in world and the second most populated in the European Union (EU) after Germany. The French overseas Dpartements have 1.8 million inhabitants.
Territorial distribution
Population density is about 110 inhabitants per sq. km, and France has 73 urban areas with over 100,000 inhabitants. However, the most salient point is that population is quite concentrated in a few urban areas: Paris and its suburbs counts more than 10 million inhabitants and more than a quarter of the population is living in the five bigger cities. The five largest are: Urban areas 1. Paris 2. Lyon Population in 2002 11.2 million 1.7 million
3. Marseille-Aix-en-Provence 1.5 million 4. Lille 5. Toulouse 1.2 million 1 million
1.1.2
Birth rate, participation rates and family composition
In terms of demographic situation, France can be characterised by the articulation of a high birth rate with a high participation rate on the labour market for women between 25 and 54, even for married women with children aged 3 or more. Some analysts considers that this fact illustrates the efficacy of public family policies combining allocations and services such as nursery schools. French nursery schools have existed since 1887. Nursery education is not compulsory, but there is a strong demand for it. The situation in France is unusual in that over 99% of three-year-olds attend nursery schools, most of them State-run.
Table 1
Age group 15-64 25-54
Evolution of female employment as a percentage of the female population at working-age, 1984-2003

1984 55,3 68,2 1989 56,9 72,1 1994 59,3 76,7 2000 61,7 78,4 2001 61,8 78,7 2002 62,1 79 2003 63,5 79,9
Source: OECD (2004), Labour Force Statistics 1983-2003, Paris.
Table 2
Activity rate, employment and unemployment of women by family type and number of children
of which Activity rate 75,3 74,2 79,3 58,5 37,1 80,0 83,7 68,6 53,2 45,9 82,2 67,3 full-time employed 46,4 50,9 55,7 28,1 17,9 51,8 47,7 31,9 33,9 29,3 52,2 41,9 part-time employed 22,1 16,7 14,1 25,4 15,9 21,8 29,4 27,5 10,6 8,9 17,3 17,9
Family type cohabiting no child 1 child <3 years of age 2 children of which at least one < 3 years of age 3 children of which at least one < 3 years of age 1 child with at least 3 years 2 children with at least 3 years of age 3 children of which at least one with at least 3 years of age not cohabiting no child 1 or more children Total
unemployed 6,8 6,5 9,5 5,0 3,3 6,4 6,5 9,2 8,8 7,7 12,7 7,5
Source: Insee, enqutes employ; annual average (France mtropolitaine: persons aged 15-59) Example: in 2004, 75.3% of women cohabiting are active: 46.4% are working full-time, 22.1% part-time and 6.8% are unemployed; yearly averages.
1.1.3
Ageing
The older population has grown substantially in the last decades, especially the very old: for example, in 1950 there were 200 people aged 100 years and older, today they are 6,000 and, according to demographic projections, this could reach 150,000 in 2050. However the consequences of this demographic pattern are not so dramatic in terms of providing and financing long-term care for disabled elderly. Due to to quite an extensive rise in life expectancy without incapacity, the French context differs from that prevailing in other countries. Since the 80s, the time spent in incapacity remains constant for women while it tends to decline for men. On the whole, life expectancy without incapacity at age 65 increased by 2.3 years for women and 1.3 years for men between 1981 and 1991.
1.1.4
Educational level
In 1989, an outline Act laid down the principle of schooling for all until the end of the second cycle and the target of 80% of the age cohort reaching baccalaurat level, reflecting the ambition to raise the education level of French people as a whole. Nowadays, large numbers of students from sectors of society which had not hitherto gone to university were entering higher education: the numbers rose from 1.17 million in 1980 to over 2 million in 1995, since when they have stabilized. The Act of 4 May 2004 on lifelong vocational training introduced an individual right to training for everyone in employment, transferable from one company to another under certain conditions (redundancy, business closure or restructuring). The right will be exercised at the initiative of the employee, in consultation with the employer. Continuing vocational training is an important economic sector accounting for 1.7% of French GDP.
1.1.5
Poverty and inequalities
The 70s are characterized by a strong reduction of poverty: 15.3% of households was living under the line of poverty (defined as 50% of median income) in 1970, 8.7% in 1979, 6.2% today. But in the same time, forms of poverty were fully modified. The generalisation of old-age insurance and the emergence of massive unemployment have shifted poverty from retired people to the labour force population: the proportion of households living under the poverty line among retired is almost seven times lower today than at the beginning in the 70s whereas among workers households, the proportion increased from 3.9% to 6.1% in 1997 and 5.4% in 2001. The group of working poor is quite heterogeneous, either low-paid employees (mostly part-time workers) or self-employed persons or people moving quickly between job and unemployment. This new form of poverty is also more responsive to the current economic situation and reflects thus more accurately the evolutions of economic growth and unemployment rates.
1.2
The State, its organization and normative foundation
The French social welfare system is mainly based on a specific set of non-State agencies in charge of social insurance, which are managed by representatives of workers and employers. People who cannot enter the labour market because of its age, physical or mental disability, and thus cannot pretend to insurance, can benefit from social assistance. This second world of social protection (Palier), called aide sociale, based on a charity principal, belongs to the missions of public governments (predominantly at the national and local level). Looking at the financing, social assistance appears to be of minor importance since the amount devoted to this type of allocation (about 15 billion through the national level and less than 20 billion through the Dpartements) is about ten times lower than the amount of insurance benefit (392 billion in 2004). The core of the system is thus the famous, so symbolic, Scurit sociale built up from 1945 to the late 1960s (Mandin/Palier, 2002: 32). Beloved or criticised, the agency is generally little known in its structure, activities and missions. It provides basic schemes in four fields of protection (branches): health care (including maternity, invalidity and death), family support, work injuries and diseases, and old age. Together with another agency, the Assurance-Chmage (the unemployment insurance), introduced in 1958, they form the social insurance part of the French social protection system. Despite the legal independence of the French social insurance scheme, the State is involved in multiple ways: as the major employer, as a specific financer since affected taxes represent now 20% of the Scurit Sociale budget, and as supervisor. This recent evolution pulls the whole welfare system aside from the initial balance: insurance to social partners and assistance to public authorities.
At the same time, social aid provision was also modified. Evolutions were required by the emergence of new forms of poverty (long-term jobseekers, frail elderly, single-parent families ). But last reforms (subsistence allocation and old-age dependence) first follow a political choice of decentralisation and have shifted a large component of assistance provision from the national State to the Dpartements.
1.2.1
Social Insurance
The Scurit Sociale provides social protection in four areas: health care, family support, work in1 juries and diseases, and old age. Developed at the beginning only for employees, it was extended step by step to most of the population with a quite complex structure. Financed by social contributions on wages, paid by employers and employees, the Scurit Sociale is managed by trade unions and employers representatives, under a more or less close supervision of the State. Complementary schemes, improving the coverage level, also exist, but may be compulsory or not. Strictly speaking, the unemployment insurance system, created in 1958 and largely modified in 1979 and 1984, is not part of the Scurit Sociale. Principles are however quite similar: the Assurance Chmage is financed by social contributions on wages and managed by social partners. But, the budget is handled separately and the negotiations of rules take place in another context. The main difference is certainly that the Assurance Chmage has not been entangled in the debate on universalism prevailing for more than 20 years now. When massive unemployment made the gap between a universal and an employment-based system obvious, a sort of failure appeared between risks related to labour market (unemployment, old age, work injuries and disease) on the one hand, and risks of relative poverty due to other circumstances, such as health consumption or family composition. In the first case Bismarckian mechanisms were reinforced despite their impossibility to achieve universal coverage. Unemployment insurance was subject to some adjustments (contribution rates, entitlement criteria, entitlement length) but the substantial changes affected the assistance part of the welfare not the insurance one: a new social assistance benefit (a kind of subsistence allowance called Revenu Minimum dInsertion) was set out by the State for jobseekers who were no longer or not yet entitled to unemployment benefit. Confusion was deeper regarding the Scurit Sociale, especially the health insurance: Beveridgians aim of universality and uniformity were finally promoted with the creation of an universal health coverage (Couverture Mdicale Universelle), latest step in a set of reforms strengthening the role of the State in the social insurance financing and governing.
Decision-making
Anyway, the delimitation between State and social partner responsibilities is not the clearest property of the system. The schemes were originally intended to have some independence from the State. For example, the social insurance system budget is still presented separately from the one of the State. According to the principle of dmocratie sociale, the scheme is managed by the social partners: for example, the unemployment insurance scheme at the national as at the regional level is managed by boards of directors composed with parity of representation of employers associations and trade unions, which take on the presidency of the institutions every two years. The regular mode of decision-making is negotiation between trade unions and employers representatives; this negotiation comes to a collective agreement, which has to be officially recognised by the State afterwards. Once approved by the Government, the conditions mentioned in the agreement become binding upon employers and employees alike. Nevertheless, the different schemes are placed under
Some occupational groups have a specific scheme for some of the four sector (the four of them in the case of agricultural workers, two of them for self-employed people and so on). 9
the supervision of the ministers in charge of social security, of agriculture and of employment, and the State influence of these negotiations has ever been effective, when more or less visible.
Reinforcing the role of the State

Regarding the case of the Scurit Sociale, in the recent period, the State was all the more incited to control the strategy of the social partners that they had shown their incapacity to stop the spending increase. A Social security deficit, appeared in 1974. Social expenditure has continued to increase rapidly until the mid 1980s and more slowly ever since. After some vain attempts to decrease expenditure, Michel Rocards government implemented an old plan in 1989: a tax has been intro2 duced into the financing mechanism of social insurance (the CSG). Since then, taxes became an important way of financing social insurance. The CSG level of taxation was increased from 1.1 % in 1993 to 7.5 % in 1998, its basis of taxation was enlarged to pensionToday, earmarked taxes on products or income provide 20% of the budget. In 1995, the State took also the responsibility for the 37.5 billion of debt accumulated by the Scurit Sociale and created a specific tax for its reimbursement; only two years later 13.3 billion more were to be added to the debt (Vasselle, 2003: 59). At the same time, the plan Jupp enforced some significant institutional modifications to the governing of the Scurit Sociale: since the constitutional amendment adopted in 1996, the control right is officially carried out by the parliament: a budget law for the Scurit Sociale is voted every year. Compared to the important changes that affected the Securit Sociale, the unemployment insurance scheme didnt depart from the initial operative mode. The main modification regards also the articulation between the State and the social partners but in quite different direction. In April 1984, a division was re-introduced between the Unemployment Insurance Scheme on the one hand and the Solidarity Scheme with the creation of the specific allowance of solidarity (allocation spcifique de solidarit). The latter, which was set up to take over from the Unemployment Insurance Scheme is fully financed by the State budget. Subsequent to an agreement between the State and the National Union for Employment, the management of this allowance has been entrusted to the same organisations which are in charge of the Unemployment Insurance Scheme, at the regional level, called the Assdic. In the year 2004, payments made under this Scheme by the Assdic represented approximately 2.37 billion Euros, which is about 9% of payments made under the Unemployment Insurance Scheme.
Activation of social expenditure

Since July 1st, 2001, the unemployment insurance agency not only provide compensation for the loss of income, but finances also some support services (mobility grant or training grant) according to a personalised plan, called Plan dAide au Retour lEmploi (PARE), worked out in cooperation with the national state-run placement agency. The clear strategy is to shorten unemployment spell by improving the fit between labour needs expressed by employers and the qualification and skills of job-seekers. As a par of this strategy, the unemployment insurance agency devotes increasing funds to buy vocational training for entitled job-seekers. The analysis of intended job-offers (labour needs) has also been developed. Finally the agency intends to consolidate its relationship with employers in order to improve their participation to recruitment session. Making job-seekers return to employment easier by means of financial aids is defined in the current Agreement (2004-2005) as one of the major orientations of the Unemployment Insurance Scheme.
Some taxes on products, such as taxes on tobacco and alcohol created in 1982, or taxes on advertising for drugs were already devoted to the financing of social insurance. Today, 23 different taxes are devoted to the financing of the Social protection. 10
The cornerstone of this new strategy is a new contract between the job-seekers and the agency. To benefit from personalized service, the job-seekers have to prove to be in the process of genuinely and actively seeking employment: this obligation is formalised in a contract signed by the two par3 ties .
1.2.2
Social assistance renewal
New income support policy: temporary benefits

The RMI was created in 1989 as a response to the social exclusion generated by the development of massive unemployment in the 1980s. Social exclusion became an emblematic phenomenon since it revealed the failure of the French welfare based on a predominantly contributory social insurance system complemented by assistance allowances targeted to a few well-defined categories of paupers. Evidence suggested that the unemployment compensation system was unable to meet the needs of those that have never worked or have exhausted their entitlement. At the same time, most of them could not claim a income support benefit since they were not kept away from the labour market by old age or by any physical or mental impairment. The cause of their exclusion was the situation of the economy and of the labour market. The new situation needed new tools. During the campaign in 1988, Franois Mitterrand proposed to create a minimum income to guarantee a means of living for all these people who dont have anything and who cannot do anything; it was the first condition of their social reinsertion. The law begins with this first sentence: each person who is unable to work, because of its age, its physical or mental state, the situation of the economy and of the labour market, has the right to receive from the community the necessary means to live (Loi n88-1088). But, the allowance cannot be reduced to an income-tested safety net, and there is the real innovation. As it was specified by the law, in its second sentence, the social and working integration of those who encounter difficulties is a national duty, and that is why the benefit is coupled with a set of actions proposed to the beneficiaries, in order to encourage their reintegration course. The RMI, with its two layer structure, represents a fundamental step in the development of a new form of public assistance, aimed at promoting social cohesion and preventing people affected by unemployment from permanent exclusion. Compared to other assistance benefits, the distinctive characteristic of the RMI was that it should be a temporary support between two working periods. This type of temporary assistance benefit poses new questions in terms of link with the labour market. The free access to re-integration actions coupled with the income support part of the allowance is one on the answer given by the promoter of the RMI. Work cost reduction policies specifically targeted on income support beneficiaries or specific employment contracts extend the system in this first direction. A second answer was based on incentives: the level of the benefit was fixed lower than the level of permanent income support benefits such as impairment allocation or old-age assistance benefit and the allowance was modified to avoid the 100% marginal taxation effect on wages (income-test include only a part of wages). A third answer is the conditionality upon the attendance at specific programs for social inclusion. A contract signed by the claimant and the social worker in charge of the case formalise the commitment. These three characteristics (access to active support, incentives and conditionality) delimit a new form of income support benefits, including RMI but also single-parent allowance and assistance jobseekers allowance. A fourth allowance, the disability working allowance (AAH) is perhaps about to slide into this specific group. The access to the new specific employment contract was just opened to the AAH beneficiaries and at the same time the objective and hence the level - of the
People aged 57 years and 6 months (or more) may, at their request, be exempted from the monthly signing on requirement. 11
benefit (income support or compensation for disability) are brought to the debate: splitting of the allowance in two parts, an income support benefit, similar to the RMI, and a compensation allowance is one of the propounded propositions. This evolution of social assistance sounds like an echo to the results of a recent statistical survey conducted by the National Observatory on Poverty and Social Exclusion. According to this survey, French public opinion is in favour of a more generous collective solidarity conditional to a deeper commitment of beneficiaries including (Gramain/Momic, 2004: 25).
Decentralisation: an attempt to revive social assistance

Decentralisation appears to be the second most important modification occurring for twenty years in this field of public policy. Two forms of decentralisation have to be distinguished. The first one apply to in-kind allowance such as child protection, long-term care allowance, or even the RMI in a way, and is related to the managing of allowance which is entrusted to the Dpartements: the rationale for that first type of decentralisation if that the local level seems should be more convenient for developing services adapted to the real situation of each beneficiary. The second one is related to financing responsibility. Setting this responsibility at a local level allows a closer and hence better supervision of the way public funds are used. As far as income support allocations for permanent inactivity are concerned (disability working allowance, old-age assistance and so on), control is not an important issue. But controlling that public money is used properly and efficiently is of higher interest in the case of in-kind benefit, because the question at stake is then the efficiency of public and private providers as well as the validity of the prescriptions or enrolments in programs for social inclusion made by social-workers. The development of conditional benefits is another reason why government chose to pay special attention to supervision and control. The two arguments were presented by the promoters of the recent complete decentralisation of the RMI. Despite better economic circumstances in 2000-2001, the number of beneficiaries decreased only very slightly. Furthermore, the RMI seems to fail in its objective of preventing the social isolation dynamic: 70% of people receiving the benefit in December 2001 are still beneficiaries two years later. Several symptoms of dysfunction have been described. For example, no more than one out of two beneficiaries have signed a reintegration contract, as required by the law (Loi n 20031200); some Dpartements even have difficulties to spend the budget devoted to reintegration actions (Seiller, 2003: 52). Concentrating the power in the hand of a single government, close from the agents, should strengthen its ability to control cases but also to stimulate and to regulate the local social inclusion strategies, and then allow to achieve a better management of social assistance (Seiller, 2003: 52). It is also important to note that a third argument based on competition between local government, that can be found in economic literature, has not been mentioned in the debate. On the contrary, the amount of the benefit and the eligibility criteria are still defined by the State to avoid any competition which could lead them, from a theoretic point of view, to suppress the benefit The decentralised RMI is thus based on a distinctive architecture, very similar to the one adopted for the longterm care allowance in 2002, combining a national framework with local regulation power and financial responsibility to ensure both equal rights across the country and efficiency. A compensation system, set out at the national level, helps Dpartements to comply with the same rules even if they face diverse economic situation. This system can be viewed as an insurance against the risk associated to bad local economic circumstances. The proportion of the national financing and the criteria taken into account for redistributing from a Dpartement to another determine for the Dpartements the balance between their coverage and their financial responsibility.
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1.2.3
The providers of social and social-medical services
There is in the French law, as in many others, a liability to contribute to support poor relatives; this obligation alimentaire is imposed on quite a large range of relatives: parents, father and mother in law, grandparents, children, grandchildren. The interaction of benefits with this legal duty is one of the frontiers between social insurance and assistance. The theoretical rule is that social assistance is subject to subsidiarity: national solidarity applies only as a complement. The liability can be enforced in two ways: first, the government can refer the matter to a judge who establishes the amount of family members contributions and by difference the amount to be paid by social assistance; but the government may also pay the whole benefit and get part of the amount back as a portion of inheritance when the beneficiary decease. There is in fact a large diversity in the degree to which this liability is taken over in the social law and enforced in practice. Social assistance provided by the State is not conditional on the contribution of family members whereas most of the social benefits provided by the Dpartements are. But empirical methods appear to differ from this theoretical rule: for example, giving the lack of enforcement of this legal duty in the case of the RMI, the parliament could just suppress part of the subsidiarity mechanism in a new version of the allowance. Reality is also characterised by an important diversity from a Dpartement to another, as in the case of social help for poor elderly for example: from 10% to 60% of social spending for elderly are recovered through inheritance-cut. Family is also an important source of care for some categories of needy persons, such as dependent elderly. A high proportion of them remain living at home, even when they suffer from cognitive impairment. The importance of informal help is explicitly taken into account, and even encouraged, by the law since the long-term care allowance can be used to employ a member of its own family (except spouses). As regards formal providers they are for a large majority public or not for profit organisation. Private providers have to apply for a public accreditation to develop activities financed by the welfare policy. The procedures differ from one sector to another. Accreditation can either be delivered to the institution for a given period of time, or on a case-by-case basis. This provides a frame work for the quality of the services and the costs incurred. For-profit institutions are quite inexistent in the social sector. Even in the nursing home sector, they represent less than 15% of authorized places, and no particular evolution was to be noticed between 1996 and 2003. In the placement sector, the monopolistic position of the national state agency was suppressed just a few months ago, and some experiments with private for-profit agencies are carried out (Loi n 2005-32 du 18 janvier 2005 de programmation pour la cohsion sociale). Non Profit Making Organisations are widely are involved in social welfare, medico-social and health care work. The activities of the 120 000 associations are aimed at very different publics (early childhood, elderly, disabled, sick people, youngsters and families in difficulties) and take place in a large range of fields such as protection, reception, support, integration, medical care, and development of people confronted on a temporary or long-term basis with difficult living conditions. They provide 55% of all advising and orientation in the social and medical-social field, with great involvement in many sectors: 15% of health activities 31% of guidance for early childhood 45% of guidance for older persons 65% of neighbourhood and in-home services 76% of facilities for people encountering difficulty 88% for disabled children
13
91% for disabled adults
According to the UNIOPSS (Union nationale interfdrale des oeuvres et organismes privs sanitaires et sociaux), associations mobilize 195 000 voluntary workers, employ 430 000 salaried people (in full-time equivalent), receive 1.5 million people, bring together 24,000 institutions and services and administer 23 billion euros An important part of their resources comes from public funds (social security payments and grantsin-aid). The accumulated yearly budget of 29 billion euros break down in 10 billions euros of own resources and users contributions, 1 billion euros of individual donations and 18 billion euros of public funding representing nearly 30% of all services provided by the state, Social Security, and the Dpartements to the health and social sectors. Health and social associations seem to have some difficulties to preserve their position in the ideological playground. First, they are increasingly called on to contribute to the social cohesion of a fragmented society. But, public authorities either try to instrument them as simple public policy agents or treat them as simple service providers operating in a large, undefined market without any consideration for their specific identity as a social force.
1.3
The Market, commodification and labour market performance
France has a total labour force of some 27.1 million. Within this category, 23.9 million are wage and salary earners and 2.68 million, 9.9% of the total labour force, are job seekers (January 2003). 62% of men and 48.8% of women are in employment.
1.3.1
Unemployment
The rise in the unemployment rate brought with it a very sharp increase in the average duration of unemployment (Table 2), which practically doubled in thirty years. Table 3 Unemployment indicators
1970 1980 1990 1997 2000 2001 2002 ILO unemployment rate (%) Average duration of unemployment (months) Unemployed for more than one year (% of aggregate) Unemployed collecting benefits (% of aggregate) 2,5 9 21 6,3 12 32 72 8,9 15 40 73 12,4 16 43 65 10,0 15,9 40,1 82 8,8 14,5 35,3 89,8 8,9 12,8 30,2 92
Source: Employment surveys 2002 - long series, INSEE; ILO unemployment rate for 2003: 9,6%; 2004:10%. 2005: 10,2%.
Table 4a
Structure of unemployment by duration (2002)

15-24 years 25-49 years 12,2 8,3 +50 years 22,3 6,3
Average duration of unemployment (months) ILO unemployment rate
6,7 20,2
14
Table 4b
Age Women
Structure of unemployment by age and sex (2002)

Unemployed since one year or more 41,8 23,4 42,7 60,7 41,5 24,7 41,7 63,1 41,7 Unemployed since two years or more 19,9 7,6 19,2 37,4 20,7 7,5 20,0 41,1 20,3
15 - 24 years old 25 - 49 years old 50 years old or more Men 15 - 24 years old 25 - 49 years old 50 years old or more Total
Source: Employment survey 2002, INSEE; results on annual average; ILO unemployment definition.
The patterns of male and female unemployment are more or less the same, with higher rates for young men and women, who also experience shorter spells of unemployment. This group has a relatively low labour force participation rate of about 40%, since most young people are in education. The length of spells of unemployment varies greatly depending on the group. Older jobseekers are unemployed for an average of nearly two years, whereas 15-to-24-year-olds have spells of unemployment lasting approximately seven months, which is less than half of the average length. The proportion of long-term unemployed (more than one year) has doubled in thirty years. This proportion has been shrinking since 1997 and has returned, during the past three years, to the level last seen at the end of the nineteen-seventies. The long-term unemployed are more likely to older and less well educated than average.
1.3.2
A changing job market
Due to the expansion of the service sector a pattern that is common to all advanced countries manufacturing has lost a lot of ground in France so that, to date, manufacturing only accounts for one in six jobs. Table 5 Employment structure (%)
1960 Agriculture Manufacturing Market services (incl. construction) Government services 22,0 29,1 35,3 13,6 1980 9,4 24,8 43,5 22,3 2001 5,2 17,7 49 28,2
Source: INSEE, National accounts, base 1995. The data for 1960 are taken from older national accounts, which use a slightly different classification system.
15
The expansion of services can be seen in both the market sector, with very rapid growth in business and personal services, and in the government sector, with the expansion of education, administration, health and social services. In the government sector, health and education services have posted spectacular growth in the last 20 years (Table 4). For example, since the sixties, the proportion of jobs in government services has kept pace with jobs in market services, including construction, wholesale and retail trade and transport. At the same time the proportion of casual jobs has increased threefold. The proportion of temporary jobs (short-term contracts, agency temping and internships) increased from 2.8% in 1982 to 9.9% in 2002. More than 90% of wage earners have job security as long as their employer survives. Nonwage jobs shrank to 10% of all employment in 2001, as opposed to 16% 20 years earlier. Table 6 Increasing temporary employment from 1985 till 2003
1985 Share of temporary employment as a percentage of total dependent employment 4,7 1990 10,5 1995 12,3 2000 15,5 2001 14,9 2002 14,1 2003 12,6
Source: OECD (2004), Labour Force Statistics 1983-2003, Paris.
Table 7
Total (100%)
Business startups
1993 272,264 2,4 6,7 12,3 32,1 3,7 2,6 15,1 18,3 11,4 6,8 1996 273,811 2,7 6,4 12,8 30,4 3,5 2,5 15,9 18,9 11,5 7,1 2001 268,619 2,3 5,2 14,6 26,2 2,5 3,4 18,7 19,4 11,3 7,7 2003 291,986 2,1 4,7 14,5 27,1 2,5 3,7 18,5 19,1 11,0 7,8
Business startups By industry (in %): Food Other good-producing industries Construction Wholesale Transportation Real estate Business services Domestic services of which: hotels, cafs, restaurants Education, health, welfare
16
Institutional analysis: actors and governance arrangements
The French state building enterprise has, historically speaking, been remarkably successful in inculcating deeply rooted beliefs linking the national territory with social progress and Republican equality with uniformity (Cole, 2003: 14). For centuries, the French nation has been built around a highly centralistic state, be it a monarchy or a republic (Braud, 2003: 10). We touch here at the core of state sovereignty which, in the French case, is intimately tied in with perception of national prestige and territorial hierarchy (Cole, 2003: 14). The pattern of central-local relations known as the French system of territorial administration (Sadran, 1992: 51) has long been the key feature of the traditional French model of polity and politics. It rested upon the principle of administrative uniformity across the nation and a pyramidal power structure. It recognised the superiority of central state interests over those of parties, regions, interest groups and localities. It formed part of a hierarchical mode of top down organisation, whereby public policies originated within government Dpartements and administrative corps where implemented in localities by state field agencies and local authorities and where coordinated by the Prefect (le prfet), the representative of the French State in the Dpartement. In this traditional model, the general interest is safeguarded by the benevolent state, planning the development of the whole of the French territory in the public good. As only the State can embody this general will, so it is essential that it be organised systematically at all levels, down to the tax office and sub-prefecture in small French towns (Cole, 2003). French sub-national authorities (SNAs) have traditionally operated within the context of a highly centralising State tradition. The municipal Councils (Conseil municipal) in the municipality and the General Councils (Conseil Gnral) in the Dpartements were traditionally instruments of central regulation before becoming locally elected authorities at the beginning of the 80s, when starts in France a long and slow process of decentralisation (Cole, 2003: 14). However distinctive, France has not been immune from common governance constraints and has been subjected to many varied internal and external pressures for change since the late 1970s, when it became obvious the State couldnt cope alone with increasing complexity, dynamic and diversity (Kooiman, 1993: 28) and had to reformulate its role, particularly in the light of Europeanization, globalisation and the strains and stresses within domestic politics. Like most other European countries, decentralisation has been part of an overall state reform strategy aiming at enhancing efficiency and legitimacy of public action though bringing decisionmaking process closer to the citizens, taking better account of local issues and creating a better balance of power between the different tiers of government. As a quite important area of State reform, the decentralisation policy comes back regularly on the top of the political agenda. In recent years, decentralisation proves to be a very hot issue in France, and a more and more contentious area as well. It is striking that, in France, even after 25 years of a decentralisation process, accelerated in recent years with the 2003 constitutional reform and its subsequent decentralisation reforms (the so-called Act II, referring to the 1982-1983 decentralisation wave as Act I) the state remains a key component of the French system of governance, as it has always been. France appears to be the only one of the five major European nations determined to maintain a form of polycentric state development on its mainland. Germany, Spain and, to a lesser extent, the UK and Italy have each undergone developments towards federal or quasi-federal systems. Unlike Spain, Germany and Italy, there are
This section is mainly based on Cole, 2003: 14. 17
no intentions to provide legislative powers to French regions. In the case of France, though a distinctive form of sub-national governance has evolved, it has been bound by a powerful coalition of centralising institutions (especially the State Council), state-centric professional interests and the widely sustained idea that republican equality can only be guaranteed by uniformity. A significant feature of the French model of public administration seems to be the capacity of the French state machine in resisting to centrifugal forces (Cole, 2003: 14). In spite of these forces, however, the decentralisation process, granting competencies and freedom of administration to territorial authorities, and the deconcentration process, granting more initiative to lower scales of the State bureaucracy) has deeply altered the distribution of power between the four government levels and the centre-periphery relationship during the past 25 years in France (Bouniol/Laurent, 2005: 9). This applies particularly to the field of social policies. Even if the French State retains its enormous regulatory and fiscal powers and remains deeply involved in local and regional affairs, according to many territorial authorities officials a new institutional landscape seems to emerge in France, especially after the second phase of the decentralisation process in recent years, resulting from the 2003 constitutional reform and its subsequent decentralisation laws (2003-2004). All by all, and taking the French State public intervention model history and legacy into consideration, we can say that France is moving quite quickly from being one of Europes most centralised States to one in which regional, provincial and municipal political levels have acquired real and significant new strength and capacity (Pinson/Le Gals, 2005: 49). The decentralisation and deconcentration process is still in progress, and it is obviously far from being completed. What is certain is that decentralisation has become part of French daily life. This section tries to give a picture of the new institutional setting in France: territorial organisation of public institutions, division of labour, mode of regulation, modes of coordination, driving force behind the process of territorial rescaling, etc.
2.1
Identification of the territorial institutions and their developments
France is an undivided, lay, democratic, social and Republic. Its organisation is decentralised. As an outcome of the 2003 constitutional reform, the new article 1 of the French constitution explicitly refers to the decentralised organisation of the French Republic. The original version, proposed by former Prime Minister Raffarin had proclaimed that France is undivided, lay, democratic, social and decentralised Republic. On insistence of Prsident Chirac, a weaker formulation has been chosen to reaffirm that the hierarchical control of the State over its constituent (subnational authorities, especially the Regions that the constitutional reform embeds in the constitution) can not be challenged, and that France definitely remains an unitary State. Explicitly rejecting federalism (though in article 72 indirectly referring to the principle of subsidiarity), the constitution reaffirms that all territories must be treated according to the principle of equality. This is a very common feature of the decentralisation la franaise, that there is no hierarchy between the different territorial levels and that the Central State is the only one that can arbitrate conflicts in-between SNAs . The French constitution now recognises four level of local authorities: the municipality, the Dpartement and the region (new), and those with a special statute (overseas areas, outside our scope of interest here). Four tiers of power can be distinguishing in France: the Central State and three subnational authorities: the municipal Council, the General council (Conseil gnral) in the Dpartement and the Regional Council (Conseil rgional).
2.1.1
The central State, key component of the French system of governance
At the highest level, the central State (lEtat) has always been and remains a key component of the French system of governance. It is viewed as the embodiment of the national interest and the central integrating force within society. In its political form, the State is understood as the set of na-
18
tional executive and legislative institutions, namely the President of the Republic, the Government (i.e., Cabinet) and the Parliament [] and the States public administration. The central State still keeps its responsibilities for security and defence, budgetary, fiscal and monetary policies, justice, foreign affairs, European policy, etc. The central State remains responsible for education (especially for curricula and human resources management), health, agriculture and fisheries, national investment and facilities (highways, bridge), energetic policy, etc. Unlike social policies which have been broadly decentralised in France since 1982-83, the French central State remains fully responsible for active labour market policies (except for vocational training, mainly in hands of the regions), for labour relations and working conditions (labour inspectorate), for social and vocational integration of migrants and for equal opportunities policies. The State is the main contributor for urban regeneration policy (politique de la ville) and have the whole sector of the social economy employment policy in hands (integration through economical activity, in French: IAE; additional work). The new Law on social cohesion of January 2005 organising an ambitious actions plan in three directions: employment, housing and equal opportunities and raising more than 15 billions euros extra for the five coming years shows that the central State remains a prominent actor on the field 5 of social cohesion in France, and stands for its guarantor.6 The state finance social minima benefits (except the minimum income allowance, in French RMI ), social housing benefits, health care access social help, etc. Furthermore, the central state retains few social policy instruments, especially on the field of social help to marginalised groups (for instance ex-offenders social and vocational integration). It should be stated that the Central State still have important regulatory and control powers on most of the welfare and social security institutions and bodies, and on most of the private actors carrying out a public service mission (mission de service public). And last but not least, the Central State still disposes of all European funds, though matters concerning instruction and grants at regional level may be transferred to the SNAs on experimental basis, as a result of the 2003 constitutional 7 reform and the 2003 law on experimentation.
2.1.2
Subnational authorities: three scales of government
In the one and indivisible French Republic, local government units were long considered to be the antennae of central government. The 36,500 Municipal Councils and 96 General Councils (Conseils gnraux) in the Dpartements were traditionally instruments of central regulation before becoming locally elected authorities in the early 80s. The Region did not really exist as a level of government previously. The idea of a regional district was progressively being introduced as an administrative and functional area from the late 60s onwards. The 1982-1983 decentralisation reform recognised three levels of territorial authorities (collectivits territoriales) in France: the municipalities and their clusters, the Dpartement and the Regions. The basic sphere of action and responsibilities of sub-national authorities have been defined in the 1983-decentralisation law organising the transfer of competencies. The SNAs scope of intervention have progressively been broadened up. The so called Act 2 of the decentralisation process (2003-2004) have organised a significant transfer of competences from the State to the region and the Dpartement, and to a lesser extent to the municipality.
5 6 7
Especially the ASS (back to work assistance allowance) and the API (lone parents allowance). From January 1st, RMI allowance is a decentralised responsibility of 96 metropolitan Dpartements. It is the case in the Alsace region. 19
The decentralisation process is not only matter of formal transfer of competences from a central level of government to a lesser one. It also a process of rebalancing political power and legitimacy issue. Furthermore, decentralisation implies necessarily that relationship between States central and local administration have to be revisited, in order to allow States local agencies officials to be able to speak directly with territorial governments and act without having to refer to Paris all the time. Those two particular points will be dealt with in the next section. The following specifies the share of tasks in general terms. Annexe 1 gives a more precise picture of the division of labour between the three scales of government, before and after the decentralisation reform of 2003.
Regions
The 22 regions in the French mainland are responsible for regional economic development and re9 gional planning , regional large-scale facilities (ports, airports, canals, etc ...), regional tourism, secondary education (construction and maintenance of secondary schools), culture (funding of regional museums). Closer to employment policies, the French regions have a crucial role on the field of vocational training policy. Since 1986, the regions are responsible for vocational training of young people. Their competences on this field have been remarkably strengthened in recent years. Since the 200decentralisation reform, the regions define and implement the regional apprenticeship scheme and the vocational training policy for young people and for adults looking for a job or looking for a new vocational course. On this particular field, the regions have moved from a implementation role towards an active policy design role. Regions are nowadays fully responsible for elaborating the 10 Regional development plan for vocational training programmes (SRDFP ) defining all trainings programme and fostering a coherent development of vocational training curricula in the region. The regions are presently responsible for the whole public programme of apprenticeship and vocational training, for youth and for adults, initial and further education. As such, the French regions are considered as the lead territorial entity (collectivit chef de file) on this field. The region has no direct competence on the field of employment policy. But as the responsible for the young and adult vocational training programme within the region, and as the responsible for financing training actions for working people, the region became a prominent actor on the field of active labour market policies in France. A last important point is that the region are progressively made responsible for a great part of the AFPA organisation (Association for adult vocational training, a national organisation under the responsibility of the Ministry of employment). AFPA remains an national organisation under supervision of the Ministry of employment, and still take part of the public employment service consortium at national, regional and local level. But AFPA is undergoing a process of privatisation, and the planning of regional training felt under the responsibility of the regions.
8
The region has a important coordination role on the field of regional economic development. Since the decentralisation law of 13 august 2003, the region as lead authority on the field of regional economic development is in charge of elaborating the regional economic development action programme, in cooperation with other territorial authorities. The region is more specifically in charge of defining the companies financial support regulation scheme at regional level. The regions elaborate in discussion with other territorial authorities the Regional planning and sustainable development scheme and sign with the central state a contract on state-region planning (contrat de plan Etat-region) for co-decision, co-action and co-funding of a joint regional investment policy. Schma rgional de dveloppement de la formation professionnelle. 20
10
Dpartements
Stuck between, on the one hand, the large municipalities and clusters of municipalities that have gained a lot of legitimacy and power in recent years, and, on the other hand, the regions as the most relevant government scale in a Europe of the regions under construction, one could have bet on a slow but inevitable decline of the Dpartement as a relevant level of government. However, such a bet would have been lost. In current France even the contrary is true: the Dpartement appears to be the scale of sub-central government which takes most advantage of the decentralisation process. It proves to be an active tier of government engaged in a dynamic, innovative and far reaching process of change and modernisation. Since the 1982/83 decentralisation reforms, the 96 metropolitan Dpartements are in charge of rural development, transportation in rural areas, the construction and maintenance of the secondary schools, roads, trade, fishing ports, tourism and environment. And last but not least, the Dpartement is responsible for social action and social assistance: almost all social welfare assistance provisions, excepts few of them still retain by the central state (strictly stated in law: few kind of housing benefits, social housing and social reintegration of special groups, ex offenders for instance) are in hands of the Dpartements. The 2003-2004 decentralisation reforms have considerably strengthened the Dpartement scope of action in this domain. The Dpartement has a general competence in defining and implementing social action policy within the Dpartement. The Dpartment is identified as the lead-collectivity (collectivit chef de file) in this domain and is responsible for the coordination of all social action, taking into consideration action of other tiers of government in this domain (principally the municipalities and the State). In particular, the Dpartement is responsible for the following areas of social action: Care for older persons: planning and regulation of old age houses, granting of the Individualised autonomy benefit (APA); Social and vocational activation people on social benefits. Since 1 January 2004, according to the Minimum income support decentralisation law of 13 December 2003, the Dpartements are fully responsible the implementation of minimum income support scheme (RMI). Since its launch in 1989, this programme was co-managed by the state (the prefect) and the Dpartement, with a functional division of power: granting of benefit and examination of individual situation felt within the States province while the Dpartement was responsible for the social and vocational activation part of this programme. the principle of co-responsibility and comanagement have been removed. The central government stays responsible for fixing the amount of the RMI-benefit and its access conditions. Social assistance to young people. Since 1 January 2001 the Dpartements are fully responsible for the young people social assistance funds (FAJ) the objective of which is to help young people facing severe and urgent (social, medical, housing, financial) troubles in order to facilitate their social and vocational integration. The Dpartement is the main funding body, but other scales of government or other welfare provision bodies can participate. Childhood social assistance (management of the files of adoption, support for the families in financial difficulties, etc.). Social assistance to disabled: social integration; housing, etc. Social protection of young people having to contend with the legal system.
Furthermore, the Dpartement are allowed to grant companies direct financial contribution in order to foster local economic development. The Dpartements financial grants programme has to be inserted in the regional economic development action plan (under the region responsibility).
21
The Municipalities (Municipalits)

France counts 36,700 municipalities of all kinds of size. The municipalities increased their influence during the 1982-83 decentralisation reform but hardly gained additional competences by the decentralisation Act 2 of 2003-2004. Beside their competencies as a central state relay (civil registry office, in particular), municipalities are in charge of urban planning, housing, social housing, nursery and primary schools, urban regeneration, waste, proximity police, domains protections. According to the 2002 democracy of proximity law, the municipalities can grant companies with subvention to foster local economic development (in negotiation and under supervision of the region). Furthermore, the municipalities hold few competences on the field of Social action. Larger municipalities must set up a municipal service for social action (CCAS). CCAS have a general responsibility for social prevention and social development within the municipality, in coordination with other public of private institutions providing social assistance to the poor. The CCAS can allow money of foods vouchers to needing people. Each year, the CCAS must draw up an assessment of social needs within the municipality and hold an file of people getting legal or optional social assistance. The CCAS provide homeless people with social and housing assistance. Besides the implementation of own local social action policy, municipalities implement social assistance programmes from the Dpartement such as, for instance, treatment of applications for minimum income.
2.1.3
Hierarchy, regulation and division of power
The 1982 decentralisation reforms were guided by two rather contradictory principles (Cole, 2003): First, that decision making responsibilities should be attributed to specific levels of territorial authorities. Second, that all authorities should enjoy the freedom of initiative (principe de libre administration) to make policies in areas they deemed to be important for their constituents. The first of these principles enshrined the so-called blocs de comptences, particular responsibilities carried out by the different levels. As a general rule, matters of immediate proximity (low level social assistance), administrative port of first call, nursery and primary education urban planning and urban permission, waste management, etc... are the preserve of the Municipalities and the various inter-municipal bodies (see below). Matters of intermediate proximity are the policy province of the 96 elected Councils of the Dpartements which manage large budgets and are major service delivery agencies (in social assistance, some intermediate education, social services, roads, minimum income). Matters deemed to be strategic are, in theory, the preserve of the elected regions: economic development, vocational training, infrastructure, some secondary education, some transport (inclusive regional rail services since 2002), with additional responsibility in culture and environment. The second principle that of the free administration of local authorities (principe de libre administration) cut across the apparent clarity of the first. In practice, the various subnational authorities have overlapping territorial jurisdictions and loosely defined spheres of competences. Even when responsibilities are clear, they are not strictly respected. Municipalities, Dpartements and regions compete openly with each other and adopt policies designed to appeal to their electorates. Moreover, there is no formal hierarchy between them. In theory, no single authority can impose its will on any other, or prevent a rival authority from adopting policies in competition with its own. Unlike in genuinely federal systems, the French regions do not exercise leadership over other local authorities. If anything, the French regions are dependent upon the co-operation of lower-level authorities the Dpartement in particular for the successful implementation of their own policies
The French institutional system looks very much like a system in which, formally, the different scales of power (including the State) are very autonomous. In reality, they are becoming increasingly interdependent, in particular as new interdependent forms of local and regional policy-
22
making have progressively emerged during recent years. In this context, the importance of negotiated policies and contractual procedures and processes (State-region contract plans, urban areas contracts, higher education contracts) has to be highlighted. By means of contracts, the French State has started to operate in a more flexible manner in an attempt to mobilise resources (and legitimacy) beyond its control. The state-region contract plan (contrat de plan Etat-rgion) appears to be the most emblematic instrument of this new emerging pattern of contractual governance: the central State and individual regions agreed on a six year planning contract by which they define initiatives to carry out together in the field of employment, sustainable development and social cohesion. It has to note that other territorial authorities are nowadays fully involved in the State-region contract plan. The urban areas contract (contract de ville) is also a very emblematic form of contractual governance and negotiated policy by which the Central state and the territorial authorities jointly work out common policy objectives and action plans and agree upon their financial investments. The development of a regional negotiation sphere seems to be of an important feature of the new French system of governance, understood as an arena within which a plurality of (semi-)public organisations interact (local and regional authorities, regional prefectures, the field services of central ministries, associations and other third sector networks, social partners - (Cole, 2003) Coproduction and mutual adjustment are the key words of this new French governance and regulation patterns.
2.1.4
The slow rise of intermunicipal government in France
A traditional feature of the French local system is the political and administrative fragmentation of local government systems. Indeed, the French municipal system has progressively been reshaped by the rise of strong inter-municipal structures. The huge number of municipalities and the problem of coordination that resulted from it has for long been one of the most sensitive problems of the French local government system. During the last century, the central government has repeatedly attempted to reduce the number of municipalities by imposing amalgamation. These attempts have not had any significant effects since they triggered the resistance of local elected officials. Beyond imposing municipalities fusions, the central government also provided new institutional formulas for inter-municipal cooperation (Pinson/Le Gals, 2005: 49). One of a major trends of decentralisation is the very slow rise of intermunicipal government, in particular in main cities, to overcome the institutional fragmentation []. The series of laws passed under the Socialist led Jospin government (1997-2002) marked a turning point to reinforce intermunicipal cooperation (Pinson/Le Gals, 2005: 49).
These reforms were driven by the desire to discourage local tax competition, to ensure a more equitable distribution of resources and to promote appropriate structures for tackling the organisational weakness of the municipal structure (Cole, 2003: 14). Specialised intermunicipal syndicates were progressively created in the post-war period in order to provide goods and services such as water, waste collection and treatment or public transportation. More integrated bodies for cooperation were also created above all in largest cities with specific taxes and compulsory activities. The more integrated of those bodies, the communaut urbaine, was imposed at the end at the 1960s to a dozen of large conurbations. The Decentralisation Act in 1982 and several other acts providing new institutional formulas for cooperation fostered the trend of creation of multi-purposed bodies raising their own tax. (Pinson/Le Gals, 2005: 49) But the decisive impulse for cooperation has been given by the 1999 Chevnement Act. This act was intended to reduce the different forms of cooperation to three formulas, one adapted for rural areas municipalities (communauts de municipalities), the two other dedicated to urban areas (a less integrated formula, the communaut dagglomration, and a more integrated one, the communaut urbaine). The act, mixing constraints for cooperation and strong financial incentives has launched a large movement of creation of structures even in the most reluctant local contexts. As a result, 14 communauts urbaines, 120 communauts dagglomration and 2033 communauts de municipalities had been established by
23
1st January 2002. This whole set of institutions encompassed 26 748 municipalities and a population over 45 millions (75% of the French population). (Pinson/Le Gals, 2005: 49)
It should be noted that intermunicipal government have few social policy tools in hands. Most of the Mission locales pour linsertion socio-professionnelle des jeunes (One stop shop for young people facing social and vocational integration troubles) and the PLIE (local plan for employment integration though economic activity) are designed at intermunicipal level. Furthermore, municipalities can delegate their social policies to an intermunicipal social action Centre (Centre intercommunal daction sociale).
2.2
Changing institutions
Section 2.1 aims at giving a broad picture of the share of tasks and responsibilities between the State and the different levels of territorial authorities. It also gives little basic information about how the division of power is taking place and about the way hierarchy between the different territorial levels is constructed and regulated. Purpose of section 2.2 is double: trying to picture out more precisely the de-centralisation/deconcentration processes and the way institutions are changing and trying to interpret theses changes and their meaning in terms of share of power and legitimacy.
2.2.1
The slow road towards decentralisation and territorial autonomy
Decentralisation in France is not a matter of before and after a specific reform Decentralisation has to be seen as a gradual and incremental process of institutional changes and institutional learning, lasting in France for 25 years. Two main milestones can be distinguished in the French decentralisation process: in the early 80s with the decentralisation reforms of 1982-1983 (recently renamed as decentralisation Act 1) and the 2003-2005 reforms (the so-called decentralisation Act 2). The decentralisation process is in progress and obviously far from complete.
Decentralisation Act 1: The Deferres reform of 1982-1983

The decentralisation reforms in the early 80s are seen as the outset of the decentralisation process in France. The 1982-1983 reform was highly complex and had far-reaching consequences. The three layers of French sub-national government the region, the Dpartement and the municipality got out sharply strengthened of this institutional reform, with large increases in budgets, staff and powers. The reform created 22 elected regional councils, replacing previously co-opted institutions, and greatly enhanced the decision making power of the 96 departmental councils and of the larger municipalities. Main important decisions of the 1982s Law on rights and freedom of Municipalities, Dpartements and Rgions are: The free administration principle: territorial authorities are recognised as autonomous governments free to take all relevant action within their scope of competences; Executive power and authority is transferred from the prefect to the 96 General Councils and 36 500 municipalities. A looser control of territorial authorities by the Central government: the ex ante control of opportunity on all territorial authorities acts is fully removed and replaced by an ex post control of 11 legality. The right of Territorial authorities to set their budget without prior prefectoral oversight.
11
Acts doubtful from a legal point of view can be taken to the administrative court by the prefect. 24
The full recognition of the region as a separate tier of sub-national government (beside the municipality and the Dpartement). Created in 1972, and prior to 1982, regions felt within the category of public body and was not recognised as an level of government. From 1986 onwards, the regional council is directly elected. The transfer of staff from the prefecture and the ministerial field services / agencies to the SNAs.
Decentralisation Act II: 2003-2004

Act II of the French decentralisation process can be seen as an a major step towards strengthening of local and regional powers and autonomy. Act II is made up of a set of major decentralisation initiatives. The starting point is the constitutional reform of march 2003. There are four main principle to the constitutional reform: First, it embeds the region in the Constitution (for the first time) and refers to the decentralised organisation of the Republic (article 1). Second, it introduces the possibility for the experimental transfer of functions to sub-national authorities (article 31.1); Third, it introduces new constitutional provisions embedding the principle of financial autonomy of local authorities. The Constitution now affirms that the principle of free administration requires local and regional to be responsible for raising the overwhelming proportion of their revenue in local taxation. Furthermore, the Constitutions says that any transfer of competences must go hand in hand with the provision of resources equivalent to those previously budgeted for the performance of those particular functions. Fourth, the constitution refers indirectly to the principle of subsidiarity (as introduced in 1992 in the EU-Maastricht treaty) without mentioning it explicitly: territorial authorities have the mission of taking decision in all the areas of jurisdiction that can best be implemented at their level. (article 72). Last, but not least, the constitutions acts the principle of the existence of an equalisation mechanism organising financial compensations in order to contain territorial unbalances.
Transfers of functions
As a result of the 2003 constitutional reform, three subsequent organic laws are taken in 2003 to organise the new institutional and functional settings landscape and to specify the in the constitutional newly entrenched principles: the organic law of 1 August 2003 organising local referenda; the organic law of 2 August 2003 organising experimentation of function transfers; and the organic law of 29 July 2003 organising the financial autonomy of territorial autonomies (see box 2). The law on local freedoms and responsibilities of 13 August 2004 organise new large transfers of competences from the central State to the subnational government. Since 1 January 2004, according to the RMI decentralisation reform of December 2003, the minimum income support scheme is fully 12 in hand of the Dpartements.
12
Since its creation in 1989, the implementation of minimum income support scheme was a joint responsibility of the State (benefits) and the Department (reintegration), and consequently a joint management at local level (prefect and chairman of the General council). The responsibility of RMI is henceforth fully in hands of the Dpartements. The Central State remains responsible for fixing the benefit amount and the access conditions. 25
BOX 1 LOCAL FREEDOMS AND RESPONSIBILITIES LAW OF 13 AUGUST 2003 10 KEY-POINTS

1. The regions are fully responsible for regional economic development and vocational training intended to young people and adults who are unemployed or want to get a new vocational guidance. The regions become the ordering parties (donneurs dordre) of national Association for the vocational training for adults (AFPA - Association nationale pour la formation professionnelle des adultes) and will receive the subventions which the State devoted to it previously; Infrastructures of transport are entrusted to the local decision makers; New solidarity missions are transferred to the departments (Minimum income; labour market activation for recipients of social minima benefits, of the departmental scheme for Social and sanitary organisation; housing solidarity funds; etc.); Social housing is delegated to the intermunicipal structures and the departments; Experimentations made possible in eight policy domains; management of european structural funds; responsibility of airports; economic interventions etc.. The completion of the decentralization for the means of colleges (lyces) and middle schools (collges); Reinforcement and facilitation of intermunicipal cooperation; Warranties for the 135,000 civil servants concerned by the decentralisation. In order to ensure the transfer to the regions and Dpartements without loss of pay, benefits or status of some 130,000 state employees, these staff will have two years in which to decide whether they wish to join the local civil service or alternatively to work on a permanent secondment basis while retaining their status within their original department. Devolved staff will be able to retain their current career paths, compensation schemes, working time arrangements and benefit packages under a parity agreement between the central government and local civil services. Financial warranties. The financial compensation of the transfers of competence consists in four principles: a. b. it will be integral, it will be concomitant: the previous year of the transfer of competences, the decentralizing ministries will carry out a temporary evaluation of the expenditure which they hitherto devoted to the transferred competences. As soon as the final data are known, it will be proceeded to the regularizations necessary; it will be controlled by a commission; it will be in conformity with the objective of financial autonomy.
2. 3.
4. 5. 6. 7. 8.
9.
c. d.
10. Reform of State local bureaucracy: coordination role of the prefect at departmental and regional level; less state controls for better state control.
Source: Direction gnrale des collectivits locales, lettre dinformation, n99, September 2004.
2.2.2
De-concentration and state bureaucracy reform as a consequence of the decentralisation process
The State apparatus is traditionally highly centralised in France. That means that local State bureaucracy units and ministry branch offices (like the DDTEFP, that is the Labour, employment and
26
vocational training ministry division at departmental level or the DDASS, that is the Social and Sanitary ministry division active at departmental level) traditionally didnt have much room of manoeuvre in the way they locally implemented nationally designed policies or programmes. Administrative deconcentration (transferring attributions from the central bureaucracy in Paris to the local administrative units and granting lower echelons of the State bureaucracy more initiatives) have been considered as a effective way of improving efficiency and effectiveness bringing states services closer to end-users and taking beter account of local specific issues. Cost efficiency has also been improved through introducing performance contract management (management by objectives) relationship between Central ministries and deconcentrated offices (services dconcentrs des ministres) or executive agencies (like the public employment service). The decentralisation process is closely linked to the deconcentration process and territorialisation processes (developing policy taking local specificities into account and organising coordination of local States agencies on territorial districts). It is generally admitted that deconcentration goes hand in hand with the decentralisation process. After the 1982-83 decentralisation reforms, the relationship between central and local State bureaucracy agencies needed to be revisited. In a context of increasing State-SNAs co-production and interacting decision making process, territorial authorities must have central State locally based interlocutor able to speak and act in the name of the State. Successive government has pursued administrative deconcentration; although this has been done has part of a less coherent and less global process than the decentralisation process. 1992 can be seen has a milestone of this deconcentration process. The law on Republic territorial administration (ATR) and the Deconcentration Charter (Charte de la dconcentration) of 19992 can be seen as an important milestone in this process of empowering State local bureaucracy. The role or prefects and branch offices have been considerably enhanced, according to the subsidiarity principle: any administrative decision should be taken at at local branch offices level (close to users needs and local circumstances), except if special circumstances require to referring to central level. At the same time, new public management methods have progressively been introduced within the State bureaucracy (contract management; management by objectives; new budgeting methods, etc). The new decentralisation impetus resulting from the Act 2 reform has boosted the State local bureaucracy reform, redefining the role of the State at territorial level in order to enhance coherency, responsibility and reactivity. Prefects are granted with a greater coordination role at territorial level (as the representative of all ministries at local level). Specific coordination competences of the prefect of region are precisely defined. The prefect of region is specifically granted with extended coordination role in all strategic matters (employment, sustainable environment, housing and urban renovation s granted). Results of this deconcentration process are ambivalent. The Cour des comptes (national accounting body) agrees that the deconcentration policy has entailed a significant movement of modernisation of bureaucracies structures and management methods. However, deconcentration remains uneven and very variable between ministries, due to different varying management methods and styles, and different administrative culture among ministries. In particular, deconcentration of HRM is still very weak. It is expected that the globalisation and flexibility of appropriations within the budget as introduced by the 2001 budget reform (LOLF, to be fully implemented in 2006 see box 2) should involve great changes in terms of financial and HR management at Prefects and branch offices level. This implies a clarification of the share of tasks between local government State local bureaucracies, but also between state local bureaucracies and their corresponding central services.
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BOX 2 The LOLF Reform: a new financial constitution.

The State budget system organised by an Organic Law from 1959 was deeply reformed by an Organic Law relating to annual budget laws, adopted on August 1, 2001 (to be enacted on January 1, 2006). This law has introduced result-oriented, performance management and cost-efficiency in public finance management. Budget nomenclature was reformed and simplified in order to operate a shift away from an inputoriented budget to a budget based on programmes, indicating strategic objectives and results. The annual budget is presented as a list of 34 missions, which correspond to public policies. A mission consists of several programmes, which are the translation of this public policy within one or several ministries and agencies. Missions, which may be inter-ministerial, are thus the budget voting units, whereas programmes are the budget appropriation unit, for budget managers. There are at present 135 programmes that replace the former 848 expenditure line items. A programme comprises all relevant appropriations, therefore indicates the total policy costing. Budget expenditure classification is by economic nature in 7 areas divided into 18 expenditure categories. Presentation of appropriations is only indicative, because programme appropriations are globalised and flexible, with one notable exception: they have a specific ceiling on wages. They may spend less on personnel and more on other resources than initially planned, but not the reverse (fongibilit asymtrique). Cash-based budgeting is now in place, while keeping double appropriation: commitment and payment.
2.2.3
Interpreting the decentralisation process in France
All three tiers of subnational government comes out the decentralisation process with strengthened powers and capacities. Regions and Dpartements have most taken the advantage of the last decentralisation round (decentralisation act 2). The rescaling process in France is mostly an top-down (vertical) process (transfers of power and competences from the State to territorial authorities and from the central State to local branches of the State and locale agencies), rather than horizontal (except in the case of intermunicipal affairs). Decentralisation means that funding and policy control have been transferred to sub-national governments. Territorial authorities have a coordination role even when the State retains few policy tools in a specific policy area.
2.3
Resources flows among territorial levels
SNAs funds are of two kinds: States transfers and own taxation. As far as the funding is concerned, two principles have been put forward in the 1982-1983 decentralisation laws: States financial transfers of all kind must be globalised under the form of single block grants (dotations). These dotations are of three kinds: the global functioning grant (dotations globales de fonctionnement), global investment grant (dotation globale dquipement), global decentralisation grant (dotation globale de dcentralisation). Transfers of competences are financially speaking strictly compensated. This general principle implies that the transfers of resources must equate the transfer of competences. That means that the Central State either abandons tax resources to SNAs (for instance car-tax, tax on propertys transfers tax, ...) or attributes block grants).
As far as SNAs own taxation is concerned, four taxes are devoted to territorial authorities.
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2.3.1
Sub-national authorities funding autonomy
The new financial frame resulting from article 72-2 of the French constitution (as modified by the 2003 constitutional reform) can be seen as a turning point in the SNAs funding history and in the State-Territorial authorities funding relationships. This article is about the principle of financial autonomy of Territorial tiers of power, for resources as well as for expenditures. Furthermore, the financial equalization (in French, prquation, that is a compensation system organising financial transfers from rich Territorial authorities to poor ones) is acknowledged as an constitutional objective. In relation to transfers of areas of jurisdiction and resources between the central state and territorial authorities, the Constitution states that any transfer of jurisdiction must go hand-in-hand with the provision of resources equivalent to those previously budgeted for the performance of those particular functions. The principle of financial compensation goes even further since the constitution says that transfers of resources must be provided in case that competences prior to the decentralisation are extended or in the case of new related competences. According to the constitutional autonomy principle and as far as the expenditure are concerned, territorial authorities are free to use their resources (within the limits fixed by law). As far as the resources are concerned, the constitution requires that any transferred resources must include a tax component. Henceforth, fiscal resources and other territorial authority own resources represent, for each kind of authority, a major part of all their resources . Article 72-2 de la Constitution defines which kind of tax can be transferred and extends the local tax policys room for manuvre. In stating that territorial authorities can perceive all or part of all kinds of taxes, the constitution allow the principle of sharing tax-revenue between the State and the territorial authorities. Furthermore, article 72 extends considerably the power of territorial Councils since SNAs are henceforth not only allowed to vote tax rates, but are allowed to determine the tax base as well. The 2004 organic law lists the SNAs own resources and fix the financial autonomy bottom rate. Territorial authorities own resources means resources directly controlled (at least partly) by these authorities, unlike resources depending from over level of power (the central State in particular). Tax resources and other kinds of own resources are: all kind of taxes, charges for service delivery, domains income, urban participations, yields, gifts and legacy. All kinds of state grants, resources related to experimental competences and loans are not considered as own resources
2.3.2
SNAs resources and charges equalisation (perequation)
An equalisations system exists since the very beginning of the decentralisation process. Without being able to rely on international comparisons, it seems to us that its too hazardous to say whether or not the inequality correction rate is important in France. The equalisation system is a redistributing mechanism aiming at reducing the variations of prosperity, and thus the inequalities, between the various local authorities. The 2003-constitutionnal reform confers constitutional value to the equalisation principle (article 72-2). A by law defined system of balancing out must correct inequality resulting from uneven tax-bases repartition and uneven charges repartition between territorial Authorities. Three equalisation mechanisms exist in France at the moment: The horizontal balancing out is carried out between the local authorities and consists to confer to the disadvantaged authorities a part of the resources of the more rich authorities. It concerns the professional tax. It is ensured by various departmental funds, of which most significant are the departmental funds of balancing out of the professional tax. It represented approximately two billion euros in 2001;
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The vertical balancing out is ensured by the States endowments to the local authorities. The global endowment of operating (dotation globale de fonctionnement) is the principal instrument. It represented approximately four billion euros in 2002; The more occasional devices of balancing-out, during new transfers of competence of the State towards the local authorities. They make for modulate, according to the situation of the local authorities, funds allocated by the State for these new competences.
The effort of balancing-out was certainly intensified these last years, but it remains still too low and is not enough targeted. Thus, according to a study of the Commissariat gnral du Plan in July 2004, the States endowments allowed, in 2001, a global decrease of the purchasing power inequalities: 40 % for municipalities and 51 % and 54 % respectively for Dpartements and regions. These results however hide strong disparities between the local authorities. If the finance law of 2004 reformed the architecture of the States endowments, the 2005 one should bring the inner rules of endowments up to date and increase the balancing out endowments.
2.3.3
SNAs financial frame
Total expenditure of SNAs amounts 184,5 billion euros in 2003, to be compared to the State total expenditure: 280 billion euros in 2003. In 2003, tax receipts represent a little less than half of SNAs resources. States grants and transfers represent less than one third of SNAs resources. The Regions autonomy rates (tax resources: 38 %) is remarkably less favourable than those of Dpartement (53 %) and municipalities (51 %). Table 8 Budget of local authorities in billion Euro
2005* 84,7 57,9 19,8 162,4 18,5 180,9 Development 2004/2005* +4,0% +7,5% +13,1% +6,3% +10,1% +6,7%
Municipalities Dpartements Regions Total Groupements fiscalit propre hors reversements fiscaux Total collectivits territoriales + groupements fiscalit propre Source: DGCL.
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Table 9
The States and the local authorities budget

Local authorities and their clusters State 280,8 252,00 78,27 0,80 28,82 4,08 17,09 12,92 224,11 305,95 239,82 -119,05 37,21 4,50 -56,71 Municipalities 78,44 52,18 26,00 2,34 8,25 26,26 16,33 3,59 nd 79,51 40,53 8,98 21,53 7,74 +1,07 nd 47,66 18,05 29,61 14,01 4,47 +3,38
Accounts 2003 Total expenses Operative expenses personnel interests transfers statutory intervention Investment expenditures direct civil investments reimbursement of debts subsidies for civil investments Total Fiscal income of which net income Reimbursements, and fiscal reductions (State) Non-tax income transfers loans State budget deficit Variation of cash-flow (local authorities)
Total 184,51 117,25 35,74 4,17 25,74 67,26 35,11 0,88 nd 189,24 91,21 98,03 55,06 18,75 +4,73
Regions 15,84 8,00 0,52 0,29 6,18 7,84 2,50 4,67 nd 15,73 7,96 7,77 5,98 1,42 -0,11
Dpartements (1) 45,95 29,84 5,27 0,69 11,31 16,12 6,58 7,95 nd 46,34 24,67 21,67 13,54 5,13 +0,38
Clusters 44,28 27,24 3,96 0,84 17,04 9,70
Transfers and financial compensations: a contentious area

Financial compensation to the very last euro has been the motto of the government anxious to put the territorial authorities officials mind at rest, most of them being suspicious and mistrustful about the government act 2-decentralisations best intentions. However, additional financial transfers aiming at covering charges resulting from the new competences presupposed the clarification of the funding relationship between the state and the various tiers of local government. This has not occurred so far. The lack of transparency around the whole process, the ambiguity concerning the governments very intentions and the way the decentralisations process has been managed (without much discussion and negotiation with SNAs; trying to find a commitment on competences to be transferred before opening a discussion on compensations, etc... ) has stirred up controversy over how exactly the Government intends to withdraw from its funding commitment. The Domestic Petroleum Products Tax (taxe intrieure sur les produits ptroliers, TIPP), has been one of the main points of discussion between Dpartements and the government, since implementation of the Decentralisation Act Part II is to be almost entirely funded from part of the revenue raised from this tax. However, this area is now subject to greater control by the EU authorities than in the past. Consequently, only when the government has undertaken a shake-up of the funding arrangements between the central state and local government and an overhaul of the taxe profes-
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sionnelle - a tax on businesses paid to local authorities - will it be really possible to assess just how serious the government is about boosting local government income to match the transferred spending commitments (Join-Lambert, 2004: 27).
2.4
Horizontal institutions and actors (subsidiarity) at each level
The most important actors engaged in welfare provision at the different territorial levels are of different kinds. We can distinguish four categories of actors. The central governments local bureaucracy: the prefect of the region and the prefect of the Dpartement; local branch offices of ministries (services dconcentrs du ministre); The central States executive agencies: for instance, the National Employment Agency (ANPE) and the Association for Adult vocational training (AFPA) both under supervision of the Ministry of employment, but not considered as ministry branch for instance. Both of these two organisation refers directly to Paris, and have are not accountable before the prefect. The territorial authorities: rgions, Dpartements, Municipalities and clusters of municipalities (inter-municipal clusters); A wide range of profit or no profit external providers; A wide range of welfare provision bodies.
The following tables try to give a broad picture of actors engaged in welfare provision at the different territorial levels and to give an idea of division of labour among them.
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2.4.1
Employment policies
ANPE (National Employment Agency) AFPA (Association for Adult Vocational training) MISSIONS CAP EMPLOI APEC LOCALES (One stop (Solve all (Back to work shop for questions reassistance for young people lated on reexecutives aged between cruitment, remanagers) 16 and 25 direction and years old facfollow-up of ing inclusions the disabled problems) workers) REGIONAL COUNCIL GENERAL COUNCIL MINICIPALITIES EXTERNAL PROVIDERS
TERRITOMINISTRY UNEDIC RIAL LEVEL OF EMPLOYMENT ( National Union for Employment in Industry and Commerce)
Central State bureaucracy At local level: ministerial branch offices under supervision of the prefect
Bipartite board National network
Central State executive agency Tripartite board National network
Association under supervision of Ministry of Labour Region progressively made responsible for training component (2003 decentralisation reform) National network Employment policy & vocation training policy implementation
Local initiative Non profit National network
Association
Bipartite board National network
SNA
SNA
SNA
Private Profit or non profit Local initiative National networks
Employment Unemployment policy design, compensation scheme funding and implementation
Employment policy implementation
Vocational training policy design, funding and implementation
Implementation Funding and Implementation of the Social as- implementation of employment programmes sistance scheme of local em(RMI) ployment initiatives - Implementation of back to work assistance scheme to social minima recipients: im-
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plementation of activation tools (subsidized jobs schemes in the non profit sector and partly in the profit sector) NATIONAL General direction of employment and vocational training (DGEFP) - Proposes the orientations of the employment policy and the vocational training; - Leads and coordinate the devices implementation and evaluates their results. -Social partners Contract man- Contract man- National counmanage and agement relaagement relacil of the Missions locales regulate the tionship with tionship with the State the State unemployment - Advisory insurance - Defines the - Defines the body close to scheme national objec- national objec- the prime Minister; The Central tives and orien- tives and orientations tations state is not di- In charge of rectly engaged. - Contract - Contract the national - Funds unemmanagement management network animation. ployed back to relationship relationship work assistance with regional with regional entities entities scheme (activation Support to reSupport to regional and logional and local entities cal entities HRM HRM Not relevant Not relevant Not relevant
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REGIONAL
Regional direction of employment, work and vocational training (DRTEFP) - Member of the Prfecture services; Subordinate to the prefect of region; - Strategic and coordination - Controls the use of public funds.
Regional direc- Regional direc- Regional direction AFPA tion ASSEDIC tion of ANPE (DRA) - Strategic - Strategic choices - Strategic choices within choices the region - Coordination - Coordination - Coordination - Support to - Support to local training - Regional local entities centre training programme
Regional representation (not in all regions) - Coordination
15 Regional centers (Comits paritaires rgionaux) - Strategic choices + coordination (not in all regions)
22 rgional councils - Elaborates and fund the Regional apprenticeship and vocational training programme
Not relevant
Not relevant
Social economy (intgration through economical activity structured at regional level (lobby, strategic orientations) Most external providers absent at regional level
DEPARTMENTAL
Departmental direction of employment, work and vocational training (DDTEFP) - Member of the Prfecture services; - Subordinate to the prefect of Dpartement; - Implements the orientations at the level of each Dpartement.
Devoluted direction ANPE - Coordination - Partnership - Support to local agencies
- It is in charge of certain ANPEs follow-up; - Is an intermediary on the labour market.
- It is in charge of certain ANPEs follow-up; - Is an intermediary on the labour market.
- In charge of vocational training: - Planning and funds.
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Underneath Dpartement (towns, intermunicipal authorities, labour market areas)
Labour market area: - Coordination role for the Coordinateur emploiformation.
- Registration on the jobseekers list; - Calculates the amount of the unemployment benefits; - Pays the specific allowance of solidarity
Jobcentres; - Demand/supply Matching - Back to work assistance - Recruitment assistance - Implementation of unemployment programmes
Local missions: social and vocational assistance to 16-25 years old Global approach of inclusion: health, housing, employment; - It is in charge of the welcome, orientation and the follow-up of any young; - Is in charge of certain ANPEs follow-up; - Participation to the local development.
- Broad range of subcontractors: social activation; vocationnal activation conselling, assesment integration
- Social economy: social integration temp agencies; social firms; social workshop, ...
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2.4.2
Assistance and inclusion policies

THE STATE LOCAL AUTHORITIES ANPE PRIVATE PROVIDERS (NON PROFIT) COORDINATION TOOLS THE NATIONAL FAMILY ALLOWANCE AGENCY (CNAF) - Centralizes funding for the family allowances and the RMI; - Participates to the managing of the policy for the family allowances and the RMI. ADVISORY INSTITUTIONS
LEVEL
National
- The government decides the global budget (for the integration by economic activity); - The Parliament votes the budget;
- The General direction

of employment and vocational training (DGEFP) centralizes the funds and appropriates those between the regional directions. Regional The Regional direction The regional govof employment, work ernment funds some and vocational training associations and local action plans. (DRTEFP) centralizes the funds and appropriates those between the departmental directions.
National federations such as the national council of the inclusion companies (CNEI), the National federation for receptions and reinsertion associations (FNARS)...; - In charge of the networks representation and animation; - In charge of the training for the employees. Regional federations such as the regional council of the entreprises dinsertion (UREI).
Integration by economic activity national council (CNIAE): Body attached to the Prime Ministers Office.
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Departmental
Departmental direction of employment, work and vocational training (DDTEFP) - It funds some associations and local action plans; - Grants authorizations for inclusions structures (in cooperation with the departmental direction for social affairs (DDASS)).
The departmental government - Responsible for the piloting of inclusion policy and planning services; - In charge of the inclusion for RMIs recipients; - Responsible for the activation of incomes support policy; - It funds some associations and local action plans.
Some departmental federations exist
Integration by economic activity departmental council (CDIAE): Body close to the Prefect. - Gives its opinion on the authorizations for inclusions structures and on the departemetals fund for inclusion; - Has an animation role and an inclusions actions development one.
Underneath Dpartement (towns, intermunicipal authorities, labour market areas)
The Local commission for inclusion - Responsible for the piloting of the local inclusion policy; - Develops a local plan for inclusion.
Jobcentres: professional teams - Confirms the inscription in inclusions actions (for each jobseeker).
- Lots of associations: on December, 31th, 2003: - 922 intermediaries associations, - 263 interim agencies for inclusion, - 866 inclusion companies, - 1 900 Inclusions yards.
Local action plan (plan local pour linsertion et lemploi) - Co-ordinates local actors and mobilise local resources to promote social inclusion.
For the concrete aspects of the RMI, it is run for the Dpartements (conventions have been signed) by the 123 family benefits institutions
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2.4.3
Care policies for older persons
LEVEL
THE STATE
LOCAL AUTHORITIES
THE NATIONAL HEALTH INSURANCE FUND (CNAMTS) - Centralizes and manages the budget devoted to health care for older persons
THE NATIONAL OLD-AGE INSURANCE FUND (CNAVTS) - It centralizes funding for old-age and widows insurance and pays the personal and widows pensions of beneficiaries under the general scheme; - It determines a budget devoted to social assistance for elderly living at home. .
COORDINATION TOOLS
National
The Parliament determines the global budget and the growth rate of health expenditure
Regional
Regional direction for social affairs (DRASS) - Conducts the regional health planning; - Grants authorisations for home nursing services and nursing homes.
- Delegation for social assistance (by order of CNAVTS) - Centralizes and followsup the financing of health care; - Determines the rate for acute care or health care in nursing home and for home nursing services.
It provides social assistance for older persons (home help).
ARH Regional agency for hospitalization For long-term care units (in hospital) only - Appropriates budget; - Controls and analyses the activity; - Regulates the financing; - Planning; - Signs the trilateral agreement.
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Departmental
Departmental direction - The departmental government for social affairs signs the trilateral agreement for (DDASS) social and social-medical facilities; - Signs the three lateral - It regulates the rates charged for agreement (for social and housing services and long-term social-medical facilities); care; - Piloting the implementation of the gerontological policies and is The Prefect informs the responsible for planning facilities Dpartemental governand services; ment in the process of planning. - Finances social assistance in institutions or in private homes ; - Is responsible for the long-term care allowance and finances half of the cost (with the State).
The Caisses primaire dassurance maladie (128 in Metropolitan France) Underneath Dpartement (towns, intercommunal authorities) The social-medical team of the departmental government visits and assesses the older person and defines a personalised care plan. Pays a global health care endowment to institutions
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2.5
The model of regulation: how does coordination take place ?
The decentralisation reforms of 1982-83 did not alter the basic, highly fragmented structure of the French politico-administrative system. Policy-making responsibilities are divided among three tiers of sub-national authority as well as a varied array of ad hoc and inter-communal bodies. In contrast to local government reform in other countries (UK), there has been no root and branch structural reform of local government in France. Rather a process of incremental accretion has taken place. New structures have been added to existing ones, without a fundamental overhaul of the territorial system as a whole. This observation remains after the ongoing act II decentralisation reforms as it did twenty years ago. After these two waves of decentralisation reforms, there remains much confusion about the division of policy making and administrative tasks between central and subnational units and amongst the local authorities themselves. While decentralising major areas of responsibility the 1982-83 laws did not specify clearly which body is responsible for what activity. Regional councils are in charge of post-16 training and adult education, but they must contend with the powerful influences of companies, of the social partners (employers and trade unions), of the French State in its regional and central manifestations and of the employment service (in hands of central government). Spreading out of responsibilities, multiplicity of organisations, overlapping competences, dispersal a funding, lack of coherence in policy design and implementation at national, regional and local level are the main features of the French system of governance. It appears to be a complex and highly fragmented system between a multiplicity of autonomous decision making entities. The decentralisation la franaise has obviously failed in its attempts to organise a clear sharing of tasks and responsibilities at each tier of government. It does not seems that the act II of the decentralisation process has brought significant clarifications in this respect, though important progress can be noticed (such as the removal of principle of co-management and co-responsibility of the RMI scheme between the State and the Dpartement or the introduction of the leadcollectivity concept). It remains that the French political-administrative system is still very highly fragmentised, divided into various autonomous decision making stratums. At the same time, the ever more transversal, collective, and horizontal nature of public problems require narrower and ever more thoughtful, considered and mature co-ordination between various stake-holders obliged to act as partners in complex policy networks. Main problems in the French governance system are: Policy segmentation; lack of general coherency; insufficient coordination mechanisms Juxtaposition of public intervention areas of different kinds. High transaction costs; Difficulty to streamline; Lack of democratic accountability.
Characterising coordination in France

Contractual governance: partnership arrangements; negotiated policies and join decision making process; Highly devolved statism (see: DiGaetano & Strom, 2003) mode of governance: corporatist and managerial.
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2.6
Conclusion
Decentralisation in France: a top-down process

The decentralisation process concerns first and foremost the territorial levels of government. It is obviously a top-down policy, by and large initiated and managed (ruled!) at the top of the State apparatus. In matters of decentralisation the political power governs in a very centralistic way, local authorities have not always been involved in respective decision-making processes. As a matter of fact, for instance, the decentralisation of the minimum income scheme (RMI) was decided by the central government without prior discussion with the General Councils, let alone negotiation. As a result of such centralist governance all matters concerning decentralisation have increasingly been marked by interest conflicts and tensions between the Central government and representatives of territorial authorities. Nevertheless, the general commitment in France to decentralisation processes is still quite important, most local level officials welcoming decentralisation as an urgent and essential issue and as an important tool for State reform and public legitimacy. Generally speaking, local and regional representatives do not refuse a new share of tasks requiring to assume growing responsibilities. As a corollary, conflicts and tensions with the Central government are generally not about contents of decentralisation, rather than about the form and management of the reform, in particular concerning the transfer of funds intended to cover new responsibilities. Characterising the very nature of the ongoing decentralisation process is thus more and more interpreted as an ambiguous and suspicious process. Most departmental officials consider that the decentralisation of the minimum income scheme (RMI) in 2004 was not more than a transfer of charges without any real leeway granted to the Dpartements for own policies. Decentralisation may therefore be characterized as deconcentration that turns the Dpartement into an executive agency of central State policy. The current decentralisation process can be regarded as a strategy of central governmental power to transfer charges to lower scales of governance in a tight context of budget constraint and huge public deficits. In this context attempts to slowly recentralise previously devolved competencies or to restore marginal State control underline the impression that decentralisation does not always seem to be a matter of Central governments best intentions.
Decentralisation in France: slow but real

Decentralisation in France is a process in progress and far from being complete. At first sight, it seems to be a slow, arduous and untidy process. However, decentralisation in France is real. Incremental effects of a long tradition of top down reform and bottom up innovations has been to increase the importance of subnational authorities as key players in the French institutional landscape, especially in the field of social policies. Decentralisation has become part of the French daily life. Few years ago, most French people could even give the name of the chairman of the regional or general council. It has been a time, not that long, that the prefect was the only local official beside the mayor, whose name could be named. Even better, more and more French people identify correctly the main responsibilities of the different territorial authorities. More substantially, decentralisation has produced a massive increase in public investment, especially on the field of education infrastructure policy and social facilities. Three quarters of all public sector investments are realized by local and regional authorities. The pressures of proximity have produced an emulative effect amongst local and regional authorities themselves, as each of them tries to build better schools or to improve the economic performance of their localities, Dpartements or region (Cole, 2003: 14). Proximity government seems to have produced better public services, especially in an area of visible public services such as classrooms, social assistance or regional rail services.
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Even more important: while local and regional authorities do not appear as privileged sites for political participation (as opposed to voluntary associations that sometimes rely upon public authorities for their support), they are less rejected than other political institution, which gives them an indirect legitimacy in a France often prone to doubt about the public sphere (Cole, 2003: 14). This is more than a by-product of the decentralisation process.
The Central State: still very involved in local and regional affairs ... more than ever ?
When interpreting changing patterns of sub-national governance in France, we must certainly not forget about established French politico-administrative traditions (in particular those of centralism and uniformity). As argued by scholars such as Mabileau (1997), contractual processes and partnership are fully consistent with French top-down administrative traditions, whereby the State remains in the lead, but relies on local authorities and other partners to finance and implement policy programmes. The central state intervenes directly in the form of steering the State-region and other public policy contracts (Cole, 2003: 14) The French State retains enormous regulatory and fiscal powers and remains deeply involved in local and regional affairs. Though, its control over resources and planning processes, the State acts as an arbiter between the conflicting claims of different localities and subnational authorities. the State defines the conditions under which decentralised units functions. It continues to determine apportionment criteria for grants to subnational units. The taxation instruments available to local and regional councils are crude and they are not at liberty to avail themselves of new instruments. Within the limits of their sphere of competences, and according to the principle of free administration, territorial authorities can develop their own programmes and policies (Cole, 2003: 14).
Decentralisation: the next step ?

Without being excessively optimistic, we can look at the decentralisation process in France as a successful enterprise. Whether it really works is of course matter of (normative) discussion, but indications on the way territorial authorities are eager to assume their new responsibilities are encouraging. One important point is that 25 years of decentralisation have made territorial authorities mature, responsible and reliable level of governments. Still, middle and long term risks of the decentralisation process have still to be pictured out. And this is not easy matter. More important is the question whether the whole system of French government could better work. The answer is definitively yes Obviously, the decentralisation process has still a future. Not surprisingly, the decentralisation act III is not announced yet, since the act 2 still have to be swallowed. Quality of regulations, quality of governing and governance structures, and subsidiarity are important items that have to be profoundly and urgently addressed before envisaging new transfers of competences. Thinking that this item will be correctly questioned in a near future and will find appropriate responses is perhaps excessively optimistic.
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3.1
3.1.1
The process of rescaling in four policy areas in France

Social assistance and local policies against poverty
Several minimum incomes
The field of social assistance and social action was partly decentralized in 1983 and Dpartements are in charge of:
43
Social programs for-childhood, Social programs for older persons (see part 3, section 4), Social programs for disabled adults (assistance to housing, compensation allowance for third person (allocation compensatrice pour tierce personnes), and since 1 January 2004, the financing of the minimum integration income.
If the management of these various allowances falls in the Dpartements sphere of competence, the determination of conditions that need to be met by the recipients belongs to the State which preserves its capacity of general regulation and definition of national social policies. Moreover the State is in charge of the allowance for single parents, the specific allowance of solidarity, the allowance for disabled adults, the insertion allowance, the housing benefit (aide sociale lhbergement) More specifically, France has nine national minima, i.e. nine non-contributory benefits, meanstested, targeted to some very specific categories of persons. Those welfares guarantee a minimum income to those categories of people (Ltard, 2005: 30): The additional old age allowance (allocation supplmentaire vieillesse), reserved to the older person of more than 65 years (60 years in the event of inability to work) having very weak or no right to the old-age insurance; The additional allowance of disability (allocation supplmentaire dinvalidit) reserved to the people which are less than sixty years, holders of a very weak amount of an allowance disability; The disability allowance (for disabled adults = allocation adultes handicaps), paid to disabled persons who cannot claim either a disability benefit, or a workers compensation insurance; The allowance for single parent (allocation de parent isol API), which can be claimed by single parents raising one or more children; The bereavement benefit (allocation veuvage), which can be claimed by the surviving spouse; The specific allowance of solidarity (allocation de solidarit spcifique ASS), which can be claimed by unemployed people who have exhausted their rights to the unemployment benefit and were working for at least five years during ten years before the end of their contract of employment; The integration allowance (allocation dinsertion), which can be claimed by released prisoners, by people awaiting to be reinserted in society, by repatriates, and by refugees asylum seekers; The minimum integration income (revenu minimum dinsertion RMI). The RMI is available to each person living in France, aged over 25, and who meets some specific conditions [] (Mandin/Palier, 2002: 32). The RMI is not a universal allowance with no conditions attached (Tuchsizer, 2003: 58) and the maximum amount that can be received depends on the number of dependent children; The equivalent retirement allowance (allocation quivalent retraite), reserved to the unemployed who are less than 60 year old adding up already 160 quarters contributions to the oldage insurance.
Concerning the RMI and the API, those allowances are purely differential and simply complete the households level of resources up to the guaranteed minimum (Ltard, 2005: 30). In the second type of social minima, the allowance is paid when the resources of the individual or the household are lower than a cap (plafond). The amount of the resources cap is higher at the
44
maximum level of the allowance, which means that the allowance can be complete (within the limit of the cap) by other resources. When the total of the resources and the allowance exceeds the cap, the amount of the allowance is reduced; the allowance functions then according to a differential mechanism (CSERC, 1997: 17). It is of significant importance to notice that the existence of the nine different social minimum shows an approach of poverty by category of population, each one profiting finally from a status custom-tailored (Ltard, 2005: 30). In 1999, the CMU (couverture maladie universelle) was created and guaranteed access to health care to the beneficiaries of minimum incomes (Mandin/Palier, 2002: 32). Table 10 Number of beneficiaries by type of benefits as of 31 December 2003
Number of beneficiaries 46,700 12,300 111,200 170,052 741,354 557,600 998,645 348,600 26,700 3,013,151 301,042 3,314,193
Type of benefit Integration allowance (AI) Bereavement benefit Additional allowance of disability Allowance for single parent (API) Disability allowance (AAH) Additional old age allowance Minimum integration income (RMI) Specific allowance of solidarity (ASS) Equivalent retirement allowance (AER) Total of the social minima in Metropolitan France Overseas Dpartements France
Source: DREES, Etudes et Rsultats, n 354, novembre 2004 (Ltard, 2005: 30)
Moreover, all the minimum incomes are subjected to a form more or less extensive of subsidiarity. For example, in the case of the additional old age allowance, the law allows a recovery on succession for the amounts paid. In the case of certain minimum incomes like the insertion allowance, the specific allowance of solidarity, the API and the RMI, there is a subsidiary device compared to the food debts (crances alimentaires) between couple. So, theoretically, the State intervenes only after the mobilization of the duty of assistance which exists between the couple and the family (CSERC, 1997: 17).
At the end of 2004, 3.4 million people were recipients of one of the nine national allowances or of the Income of solidarity (revenu de solidarit), allowance specific to the overseas Dpartements. This corresponds to an increase of 3.4% of the number of recipients in 2004 compared to 2003 (1,6%). Prior to this increase there had been a decrease between 2000 and 2002. When including couples and children of the recipients, a little more than 6 million people were covered by the social minima, including 5,6 million in Metropolitan France (Avenel, 2005: 3).
3.1.2
Social Assistance and working status
In France, the fact of receiving a minimum income does not mean to be excluded from the labour 13 market. According to the categories of recipients, between 20 and 25% were employed in 2003 (Belleville, 2004: 6). The employment rate is approximately three times higher for those who have stopped receiving the minimum income they were still getting a year before than for those who still
13
In the first quarter 2003, 5000 recipients of a minimum income in December 2001 were questioned on their professional situation. 45
claim it: if 42% of the recipients having stopped receiving the RMI are employed (respectively 42% and 37% for the ASS and the API one), it is the case of 17% of those who remain on the minimum income (respectively 14% and 13%). The mechanism of interessement, set up for each of these services, largely explains this phenomenon as it makes it possible to cumulate during a certain period allowance and wages beyond the maximum amount. Among the nine types of minimum income, the RMI, the API and the ASS were originally conceived with different rationales. In the meantime they have come closer in focusing on a potentially active population with the objective to return into employment (Mercier/Raincourt, 2005: 34). Table 11 Employment and looking for a job on the first quarter 2003 (in %)
API (1) Employment In search of employment Not in search of employment Total 13 32 55 100 (2) 37 39 24 100 Total 23 35 42 100 (1) 14 51 35 100 ASS (2) 42 28 30 100 Total 21 45 34 100 (1) 17 46 37 100 RMI (2) 42 35 23 100 Total 24 43 33 100
Source: DREES, survey about the recipients of minimum incomes (Belleville, 2004: 6); Note: (1) Still receiving a minimum income; (2) Left the minimum income scheme.
3.1.3
Active assistance
The RMI is the greatest step forward in the field of social assistance in the last twenty years. It is not only a minimum income: social and professional inclusion is seen as a national imperative. This minimum integration income is one of the elements of a global mechanism to fight against poverty and suppress all forms of exclusion especially in the fields of education, employment, training, health and housing (Mandin/Palier, 2002: 32). The RMI was geared to helping reintegrate those facing difficulties into the workforce. This was to be achieved by providing financial assistance to those whose income fell below a minimum amount, together with concrete assistance in the shape of an integration contract (Tuchsizer, 2003: 58), signed between the recipient and society (engagement rciproque). Recipients must commit themselves to take part in a reinsertion (social or professional) program, as stated in a contract, signed by the recipient and a social worker. Such program can be either job-seeking, vocational training or activities designed to enhance the recipients social autonomy (Mandin/Palier, 2002: 32). However, reception of benefit is not conditional upon participation in the insertion contract, even if the situation may change. Recipients of the minimum income (RMI, ASS and API in particular) might see the range of the sanctions in case of fraudulence or failure to the insertion duty widened (Mercier/Raincourt, 2005: 34). This situation is not the same for the unemployment benefits: in this case, when a jobseeker doesnt take part in an action for his return to employment, he might be removed from the list of jobseekers. In December 1988, when the law for the minimum integration income was voted, integration was not seen by the legislator as the responsibility of individuals, perceived as victims of circumstance, but rather as one of society as a whole.
46
3.1.4
Decentralisation of the RMI
Dpartements gain competences

This point of view probably also explains that the burden of the benefit was placed on the central State and not the Dpartements (Tuchsizer, 2003: 58), even when they were in charge for the social assistance under the terms of the laws of decentralisation of 1982. Until 31 December 2003, the administration of the integration aspect of the benefit [was] currently shared by the State and the Dpartements (Tuchsizer, 2003: 58) but the State was responsible in terms of allowance for RMI (attribution, renewal, suspension of the payment of the allowance). However for some people the effectiveness of the system was not entirely good (in particular with an insertion on the labour market judged too low, a high number of recipients, a too long seniority and a low-level of integration contract signed). The Minister of social affairs talks about a semifailure and has decided to decentralise the RMI. So decentralisation transfers responsibility for the management of the entire system to the Dpartements (MINEFI, 2003: 35). Since 1 January 2004, the Dpartements have seen themselves entrusted with the responsibility for the financing of the allowance of the RMI: from now on they decide the implementations strategies (attribution, renewal, suspension of the payment). At the same time, they have the responsibility of the financing and the administration of the integration aspect of the benefit (actions of insertion proposed to the RMI recipients), which they shared with the State.
However, even under decentralisation, the amount of the RMI and the general eligibility criteria will continue to be set by the state. (Tuchsizer, 2003: 58)
As regards to the concrete aspects of the allowance, it is run for the Dpartements (conventions have been signed) by the family benefits institutions (caisse dallocations familiales) or the Caisse de Mutualit Sociale Agricole.
but decentralisation raises questions

First, the number of beneficiaries seems to be unevenly allocated on the territory (Cazain et al., 2004: 12). On 31 December 2003, five Dpartements concentrated a quarter of beneficiaries in metropolitan France. This raises the question of balancing out (prquation) intended to support the equality notably between Dpartements. Actually there is a vertical balancing-out, which corresponds to a payment from the State to the Dpartements. Second, even if the financing of the RMI was decentralised, Dpartements dont have the means to have an effect on the number of recipients and are therefore in a complex situation. They wish to control their expenditure more and to support the return to employment of the RMI recipients who are the closest. But they do not have any power upstream neither on the regulation which modifies the number of recipients [like the reforms of the unemployment insurance or the Specific Solidarity Allowance] nor on the amount of the TIPP [Inland tax on the Petroleum products] (Mercier, 2005: 33), which finances the financial compensation induced by the decentralisation. They dont have any power on the evolution of the scale either (volution du barme): The RMI is a means-tested allocation. So if there is a rise in the scale, some households fall under the cap. Moreover, the situation on the labour market has worsened since 2001 and people have received the RMI more quickly. For all these reasons the Dpartements ask that modifications be made to the overall architecture of the insertion policy: they wish in particular that the transfer of competences be accompanied by a transfer of decision-making power on all the elements affecting the financial expenditure which they represent, or at least participation of the Dpartements in these decisions.
47
3.2
3.2.1
Care for older persons14

Facilities
Care for older persons covers a wide variety of facilities and services, ranging from home care to healthcare institutions. Home help is intended to provide assistance for people aged 60 years or more with the activities of daily living and thus help them to continue living in their own homes. In 2003, slightly more than 6,000 accredited organisations provided about 550 million hours of help for frail elderly (Raynaud, 2005: 50). Depending on the beneficiaries income, home help is partially or fully financed by retirement schemes (which paid for 75% of home help expenditure before the APA was created) and by social assistance benefits provided by the Dpartements. Home nursing care services (68,000 providers in place at 31 December 2001) provide older persons with nursing care and general healthcare. They provide assistance needed to accomplish the essential activities of daily life. Their task is to prevent, postpone or shorten stays in hospital or residential care institutions. Home nursing care is fully financed by social heath insurance. Providers are in a large majority private organisations (two thirds), mostly non-profit. Residential facilities for older people provide housing and care services for more than 650,000 elderly. The residential sector has been committed to an ambitious process of renovation since 2002 in relation to quality management, coordination and planning. Yet, residential facilities greatly differ in terms of legal status, size (from 10 beds to 600 beds) and degree of medical care provided. They include: Old-age homes and sheltered housing: these are social and socio-medical facilities that are primarily intended to provide permanent accommodation for older persons, but they do not dispose of medical staff. Home help and health care can be provided to residents in the same way as in private homes; Nursing homes, which provide social as well as medical care to dependent older persons; Long-term care units which are the most medicalised facilities: part of the hospital sector, they are designed for patients requiring constant medical monitoring and maintenance treatments. 90% to 95% of the patients are aged over 65. The majority of them suffer from behavioural and mental disorders.
A large range of in between services, such as home-hospitalisation, and respite services for family carers, such as day care centres, night nurses, temporary accommodation and support groups, are also available, but remain rare. The latter type of services, which are particularly needed by family members caring for someone with cognitive impairment, were encouraged through an action plan for patients with Alzheimers disease and similar diseases, signed in October 2001. Extending day care facilities and temporary accommodation capacities in order to prevent the burnout of family caregivers meet also another priority of the current policy, preventing elderly persons' abuse.
3.2.2
Geographical disparities
Access to any of these forms of care is partially restricted by local availability and financing procedures. According to the last survey on residential institution for elderly, conducted in 2003, supply consists of about 700,000 beds, leading the average coverage rate to 140 beds per 1,000 persons aged 75 or more, the half including medical care (Raynaud, 2005: 50) (Le Bouler, 2005: 29). But availability varies in quantity and quality, with geographical inequalities. This means that the pro-
14
This part is mainly based on MISSOC, 2002: 39. 48
vision of services varies from one Dpartement to another: for example the number of nursing home beds for 1,000 persons aged 75 and over stood at 95 on average, but varies from 7 to 178 and half of the Dpartements has a coverage rate over 100 per 1000 (Le Bouler, 2005: 29). The same disparities could be mentioned about sheltered housing or home nursing care services.
3.2.3

Major recent reforms
Major recent reforms have affected medical and social care in at least five directions: meeting the demand for help and care, improving the quality of care and the degree of medical assistance, fighting against disparities (geographical disparities but also inequality in the benefit of collective solidarity according to living and care arrangement), improving coordination and political regulation of the supply side of the market, promoting the empowerment of older persons and, if need be, of their next of kin.
In less than a three-year period, quite a few new instruments have been put into effect in this specific area. Three of them are described below.
A new allowance
The Old Age Dependency Act of 20 July 2001 introduced the Allocation personnalise dautonomie (APA). Initially targeted at poor elderly living in nursing homes, the social assistance financed by Dpartements has been then enlarged to any elderly whatever his or her living and care arrangement (home or residential care) and whatever his or her income level. The allowance is intended to pay for the human and technical attendance required and not for the provision of health care already covered by health insurance. The principles can be summed up as follows: the benefit is granted in-kind , the entitlement is based on a personalised assessment of needs according to a national scale; the entitlement is not restricted by means testing, however the amount of the allowance is adjusted according to the recipients means; the amounts reflect the level of care needs of the beneficiary in 4 levels; allocation is not subject to subsidiarity neither at the moment, nor at the death of the beneficiary (no repayment is taken from the beneficiarys estate after death); the allowance is allocated and managed by the President of the Conseil Gnral (the local government); costs are shared by the Dpartements and the State (about half each).
The APA is a good illustration for the current French conception of social assistance. It is aimed at ensuring an equal treatment to all beneficiaries at a national level: disparity in the level of solidarity between Dpartements was one of the major complains about the previous allocation (called the PSD). However, at the same time, because the local government is in charge of its management, this allowance is definitely an instrument for local development and local welfare policy. This articulation of national equality, attested by rates and assessment scale fixed at the national level, with local regulation power and financial responsibility sounds very similar to the new RMI organisation. It implies, in both cases, a balancing-out mechanism to allow Dpartements in diverse situations to comply with the same rules: financial transfers, representing half of the total cost of
49
the allowance, are allocated by State to the Dpartements according to their charges and resources (conditional upon fiscal potential, number of beneficiaries, ratio to the average level of expenditure ).
15
Institutional Partnership in Gerontological Policies

The regulation of care for the dependent elderly rely anyway on a much more complex partnership between central government and local authorities (Dpartements and municipalities), but also social insurance agencies and private institutions. The central government defines and steers policies aimed at older persons and ensures that they receive equal treatment throughout the country. It also oversees social security bodies and helps to finance housing improvement. At the same time, the Dpartements have extensive powers in the area of social assistance for older persons. They grant authorisations for residential facilities and regulate the rates charged. They finance social means-tested benefit for elderly living in nursing or retirement home. They are responsible for allocating the long-term care allowance and finance half of the cost. Nevertheless, the Dpartements have full discretion for the piloting of gerontological policies and they are responsible for planning facilities and services within each Dpartement (through the implementation of a gerontological plan). Social insurance takes part in the system in two ways. First, retirement funds used to finance home care but have become quite marginal since the long-term care allowance was set out. Second, the health insurance plays an important role, granting authorisations for the medical side of residential care. The Municipalities provide community services that enable older persons to continue living in their own homes. To ensure continuity, transparency, local responsibility and coherence for public policies aimed at older persons, in such a context, the law have initiated the development of community gerontological coordination units (CLIC). Supervision and planning take place at the local level so that Prefects and presidents of local governments share responsibility for mobilising local partners and forging structured partnerships. Regarding the financing, the Dpartements have now the responsibility for this coordination structure, but the State financed more than 40% of the total budget. The development of these new coordination tools encountered some difficulties. 25 CLIC were set up in 2000, and more than 500 exist in 2004 (Le Bouler, 2005: 29). But the level of service provided varied from providing information to proposing a care plan coordinating community responses to the needs of older persons after a medical and social assessment. Depending on local circumstances, the coordination zone defined as the users living area (within a single Dpartement) may cover a population of 7,000 to 10,000 people aged over 60 in rural areas and 15,000 in urban areas. The municipal involvement seems to be far from systematic. A few years later, providing locally accessible information to give older persons and their families easy access to existing activities, benefits, care and services remains a challenge
The trilateral agreement procedure

The trickiest undertaking opened by the latest reforms is certainly the new trilateral agreement . Intended to support the introduction of a three-part financing arrangement, it has been used also to
16
15 16
Transfers are made through an independent fund, the CADES. The reforms were introduced by the law of the 24 January 1997 and by two decrees signed in April 1999 and May 2001. It was more recently modified by the budget law for the Scurit Sociale of 2003. 50
promote, in quite a coercive way, the upgrading of medical care in institutions and the improving of the quality in the service provided. Considering the first dimension, it has the great advantage ofmaking the rationale of the partnerships visible in the rate charged. Three parts can be distinguished: one for health care financed directly by health insurance, one for daily living help, partially financed by the long-term care allocation (APA), with a three level system depending on the residents degree of incapacity, one for housing services, subject to subsidiarity rules, and financed either by the resident, his or her family, or the Dpartement if needed.
The second dimension was also a pressing challenge since the delayed-nursing-home entry faces these institutions with more advanced patients requiring not only help with the activity of daily living but also acute nursing and maintenance care. The dynamic has been however very slow at the beginning: only one third of the agreement was signed been signed between 2000 and the 1st of January 2004. But as the deadline of 31st of December 2005 approached it became faster: one year later, 308,000 places were concerned (about 60% of the capacity if sheltered houses are excluded). Quality targets form a key part of the trilateral agreements. The agreements include a facility strategy which has to give due consideration to the specific characteristics of residents (cognitive impairment, incontinence, final life stages, etc.) and call for appropriate care through case management by a coordinating physician with gerontology skills. The specifications define the main recommendations aimed at ensuring quality care for residents and are based on a list of indicators. The recommendations are qualitative benchmarks that are different from technical standards. They concern the residents quality of life, the quality of their relationships with family and friends, the quality of the staff and the quality of the integration into a coordinated care system. The first tripartite agreements, signed for a five-year period have now come to an end so that evaluations will soon be available.
Empowerment and protection of patients rights

The Social and Medical Action Act of 2 January 2002 provides additional protection for the rights of users of social and social/medical facilities. To improve the transparency and the quality of care all providers were required to develop guidelines, a charter of older persons rights, accommodation contracts in residential care, facility strategies and facility councils were required. The priority is also pointed out in the management of health care sector, since the Patients Rights and Healthcare System Quality Act of 4 March 2002 makes patients the focus on organising healthcare. The Act enshrines the patients human rights, such as the right to secrecy, the right to protection against any form of discrimination, the right to dignity, etc. It also guarantees the specific rights of individuals in the healthcare system (right of free and informed consent, right of access to medical files, etc.) and patients collective rights (recognition of the place and role of users associations in all healthcare system bodies).
Challenges for a new labour market

The Home help sector has not been left aside from the global trend, but circumstances are even more adverse in this case: the sector has been shaker up by the introduction of the long-term care allowance that tripled the financing available for assistance for older persons. This created the need for more home-help services (20,000 full-time job equivalents) and for upgrading existing workers skills to improve services. The creation of a new diploma for social auxiliaries in March 2002 is a step in this direction. The Old Age Dependency Act of 20 July 2001, which instituted the attendance allowance, set up a home-help modernisation fund and provided it with 53.4 million euros for 2002.
51
A certification system aimed at verifying compliance with the standard was adopted in 2001. In the home help sector, the home services standard went into force in 2000. Standards, which are official quality benchmarks that operators undertake to respect, are voluntary. It covers all of the services provided by government-authorised providers. The standard aims to ensure quality services for users at every stage: receiving customers, processing requests (analysing needs and the services available), providing services in the home (preparing and providing services). The standard also defines the principles for measuring ongoing service quality improvements (dealing with complaints, assessment of service quality as perceived by users), and the skills requirements for different jobs.
3.3
Employment Policies17
In France, employment policy is traditionally and still very largely the responsibility of central 18 government, in contrast to most other social policies, which have been broadly decentralised. Although the social partners have been responsible for unemployment benefits for over 40 years and have finance several activation programmes in the 80s and 90s, they have long played a limited (funding) role in the handling of unemployment in comparison with the considerable amount of money spent by the central government on employment-related programmes. These activation programmes have recently taken on greater importance with the unemployment compensation reform 19 of July 2001 and the creation of the Back-to-work Assistance Plan (PARE ). As described below, the 2001s reform reflects a profound change in the unemployment insurance scheme and the role of its implementations body. From 2001 onwards, UNEDIC (National Union for Employment in Industry and Commerce), the national organisation responsible for the unemployment insurance system, has thus considerably increased its role in the organisation, the funding and to some extend in the orientation of back to work assistance, and can therefore be considered as a major player, beside the State, on the field of the handling of unemployment and active labour market policies. At first sight, the 2003-2005 decentralisation reforms (act II, see part 2) has not altered the existing balance on the field of employment policies. Indeed, regional, provincial and local authorities still dont have much direct and formal competences on this field, and the central government continue to have general responsibility for employment policies in order to ensure social cohesion. However, in-depth analysis shows that the devolution of power in employment related policy fields (such as vocational training and social policy) to the other tiers of government, as well as far reaching changes in the way social and employment policies are conceived and implemented at local level, make the situation less binary than the interpretation of the formal setting would suggest it. Recent developments confirms that far-reaching changes are in process in France on the field of employment policy and handling of unemployment, addressing the governance issue in a very actual and particular way. This section firstly sketches in the institutional setting of employment policies in France and give few characteristics of the French system of public intervention on the labour market and unem17
This section is mainly based on: CERC (2005) Assisting the return to employment, Report 6. Paris: la Documentation franaise (http://www.cerc.gouv.fr/rapports/report6cerc.pdf); Simonin, B. (2003) France: Providing greater Flexibility at Local Level, pp. 219-249 in OECD, Managing Decentralisation. A new Role for labour Market Policy. Paris: OECD ; Simonin, B. (2005) Formal Contracting with Providers in France: a technical Approach with higher Political Stakes today, pp. 281-305 in Sol, E. / Westerveld, M. (eds.) Contractualism in Employment Services. A new Form of Welfare State Governance. The Hague: Kluwer Law International. As a result of the decentralisation process started in France in 1982-1983, the regional tier of governement is fully responsible for (amongst other) regional development, apprenticeship and vocational training policies, while provincial and local authorities are responsible for sanitary and social assistance. See part 2 In French: Plan daide au retour lemploi 52
18
19
ployment compensation. Secondly, it rapidly shows how the rigid, hierarchical model of the 80s and the beginning of the 90s has progressively be made more flexible and decentralised, in order to better calibrate employment policy to regional and local variation and specificities and to the endusers needs (jobseekers and companies). It highlights uncertainties about which governance model to adopt in the 90s and clarifications occurred at the end of the 90s. Relating to the governance issue and the path towards a multi-level governance, this section shows that difficult for the central government to affirm its comprehensive responsibility for all employment policy programmes and consequently its dominant role in defining local strategies in co-ordinating the various actors. The last part of this section gives a general picture a recent developments and the way these developments questions the governance issue and alter the previous balance of power and share of responsibilities between the different ties of government.
3.3.1
Institutional settings of employment policies (and vocational training) in France
The central governments main institutional instruments in the field of employment policy were set up in the late 60s, even before the advent of mass employment, wih the creation of two public organisations placed under supervision of the ministry of employment and labour: the national employment agency (Agence nationale pour lemploi - ANPE) ; the association for adult vocational training (Association pour la Formation Professionnelle des 21 Adultes - AFPA).
20
A French characteristic of the institutional setting of employment policy is that a clear split of tasks and responsibilities between the ministry and its two executive agencies as never really happen. The ministry of employment in not only responsible for policy formulation, design, monitoring and evaluation. The ministry is also responsible for the direct implementation of several programmes (for instance, disabled employment programmes, job start programmes, vocational training policy to long term unemployed (transferred to the region), subsidized jobs in the non profit sector, etc ... ). It fulfils its implementation role beside those of ANPE and AFPA, through its local branch of22 23 fices (at regional and departmental level).
The Public employment service

Due to the increasingly shared responsibility for (un)employment schemes between three governmental actors (Ministry of Employment; ANPE; AFPA) and one major non-governmental actor (UNEDIC), coordination issues became ever more important in France. As a result, in the 1980s the Public Employment Service (PES) was set up. During the 1990s, the coordination of several actors became subject of concern also at the local level. Unlike most other countries, the PES does not represent a single organisation dealing with the integration of unemployed in the labour market, but it originally represented a consortium of public organisations co-ordinating their respective policies and instruments on the level of central government. The PES is thus not a separate agency, but an arena of cooperation between the three core institutions responsible for implementing employment policies at the national (SPEN), regional
20
Set in 1967; 23000 employees ; more than 1000 field locations ; yearly, more than 3 millions vacancies (figures for 2004). Set up in 1964; 11900 employees 265 training locations and 206 courses counselling location; 155.000 vocational trainees; 64,4 millions training hours in 2004. Direction rgionale du travail, de lemploi et de la formation professionnelle (DRTEFP). Direction dpartementale du travail, de lemploi et de la formation professionnelle (DDTEFP). 53
21
22 23
(SPER), departmental (SPED) and local (SPEL) levels: central and detached offices (locally based branch offices) of the Ministry of Employment, of the ANPE and the AFPA (initially also the UNEDIC participated at national level). Later on, the PES also became the place where coordination with other governmental policies took place. In particular, the central and local offices of the Ministry of Social Affairs, and the representative of the ministerial delegation for womens rights became full members. When territorialisation processes set off in the 1990s, the PES at local level became a consortium of a broad range of local institutional or semi-public actors. Even if the PES was opened for other actors, it is to be distinguished between the core PES and the enlarged PES or PES second circle (SPE largi / SPE second cercle) that include, among others, the vocational training and integration unit of the Region, the Integration division of the Dpartement, Assedic (unemployment benefit at local level), Mission locale (one stop shop for social and vocational integration of young people), PLIE (integration through economical activity programme) APEC (jobcentre for executive managers), Cap emploi (jobcentre for disabled), Fasild (integration of migrants).
24
Role of social partners in the handling of unemployment: 2001 as a turning point

Although the social partners are represented in the tri-partite ANPE and AFPA boards, they traditionally play a limited role in active labour market policy in France. Still, the social partners take general responsibility for the unemployment compensation regime (UNEDIC). As mentioned previously, the several activation programmes set up in the 80s, and reinforced in the 1990s, do confer a minor role only to social partners in dealing with unemployment. in comparison to the considerable amount of money spent by the central government on employment-related programmes: from the 2001 unemployment compensation reform and the foundation of the PARE (the Back-to-work Assistance Plan), including the recruitment of 3.600 ANPE advisers, individual support or training services, relocation support devices or subsidies to employers for hiring the long term unemployed. UNEDIC became a major actor on the field of active labour market policy. As a result of this new course, UNEDIC started to set up own vocational training programmes for compensated unemployed and is now fully considered as a important training provider, though all trainings are contracted-out. Previously, UNEDIC intervened merely as a training funder, but not as a training organiser. UNEDIC is the second most important training provider for unemployed after the region. Moreover, UNEDIC stated in 2003 (on an experimental base) contracting-out to private (for profit) 25 reintegration companies to get compensated unemployed back to work (without having to deal with the Employment agency). This general orientation has been confirmed in the meantime since UNEDIC plays a greater role in not only for funding various elements of back to work assistance scheme (training and employment support), but also in the providing of placement support (through third private contractors) and the setting up of own training programmes. The very new unemployment compensation agreement (signed in December 2005 for the 2006-2008 period of time) confirm this evolution, making UNEDIC a major actor on the field of active employment and back to work policy. It should be noted that unions and employers are very badly represented at regional and local level. That means that the social partners dont play any significant role in the formulation and implementation of active labour market policy at regional level, let alone at local level.
24
SPEN (Service public de lEmploi National) ; SPER (Service public de lEmploi Rgional) ; SPED (Service public de lEmploi Dpartemental) ; SPEL (Service public de lEmploi Local). The first contract with an external provider has been signed in 2003 with Maatwerk, followed by contracts with, among other,s ingeus, adecco, etc. 54
25
3.3.2
A growing need to rely on local initiatives
It proved difficult for the central government to affirm its comprehensive responsibility for all employment policy programmes and consequently its dominant role in defining local strategies in coordinating the various actors (Simonin, 2003). a) The wish to provide users with diversified and more integrated services to make its action more effective obliged the ministry of Employment and its executive agencies to work together with other institutions, especially for some of the services outside the scope of its specific responsibility and which delivery involves other central government agencies especially the ministry of social affairs for sanitary and social assistance to marginalised groups) and regional and local governments: regions, responsible for regional economic development, apprenticeship scheme and continuing vocational training programmes. Dpartements, having numerous responsibilities in the social policys field. In particular, they must finance programmes aimed at ensuring the social and vocational integration of recipients of the social minimum income (RMI), the main allowance provided to the poor, often registered as jobseekers by the jobcentres. local authorities (municipalities: 36,500 in France, of all sizes) having fewer direct responsibilities in employment related fields, but given the needs of their unemployed residents and of companies wishing to move into their area and develop activities there, having come to play an more active role. Furthermore, local authorities have a general responsibility for implementing the urban policy (including an integration and employment constituent). Local authorities are also responsible for initiatives on the field of social and vocational integration of 16-25 people 26 (mission locale) and initiative in the field of integration though economic activity (PLIE).
It has proved to be impossible to clarify the respective responsibilities of each level of government using the concept of separate sets of responsibilities (bloc de comptences) that had been adopted during the initial phase of decentralisation and which was supposed to make it possible to establish a clear separation between the field of employment, training, social and sanitary action and local development. b) The role of local authorities became all the more important because central government, in order to develop its programmes and multiply the temporary jobs that it subsidises in the non market sector (several hundred thousand jobs each year), strongly encouraged them to recruit the unemployed for these types of jobs and finance jointly the many associations that wished to create such jobs. In the 90s, many municipalities came to develop action plans in order to use these programmes in a more strategic way. c) The decentralisation process (lately undertaken in France compared with many other countries), is far from complete: many elected officials in territorial authorities though that it was legitimate to take initiatives or launching local employment policies or programmes, anticipating that they would be given such responsibility in the future. It should be noted that European Social Funds (ESF) is encouraging such local and on partnership based initiative on the field of employment and vocational integration for many years d) Since 80s, many networks of non profit organisations (third sector) providing assistance for economic and social integration of the poor and unemployed (as well as support for own business starting) have developed many new forms of employment initiatives. They promote many initiatives they consider to be more effective than the standardised programmes of the PES. Some of these ini26
Both Mission locale as jobcenter and social center for young people and PLIE (Plan local pluriannuel pour linsertion et lemploi) are local employment strategies on initiative of local authorities (while funding of this initiatives is a joint responsibility of the central state and the three sub-national governments: region, Dpartement and municipalities). 55
tiatives have progressively been recognised by the central government and have become key parts 27 of its national employment strategy (especially on the field social economy ). These organisations, which continue to receive financial assistance from central government, wished to be recognised as having joint responsibility for running these programmes and for defining policies for their future development, and they have sought to establish equal partnership with the central government rather than acting merely as its subcontractor. e) The wish to provide users with more diversified services and the explosion of total sum devoted to back to work services and assistance (especially from 2001 on after the set up of the PARE) 28 obliged to rely on a broad range of external providers. Altogether, the handling of unemployment in France can be seen as a increasingly complex policy field with many different initiatives (of different kinds) at different governmental levels and with many actors having different stakes and objectives, interacting in various forms, according to various rationales, without clear definition of roles, tasks and responsibility. On this particular fields of public intervention, the coordination issue is a very hot issue.
3.3.3
A rigid, hierarchical model progressively made more flexible and decentralised
The operating methods of the employment services have long been characterised by a rigid, hierarchical organisation that has left little room for initiatives by regional or local offices and has not 29 been conducive to developing partnership with other institutions (Simonin, 2003). However, like all other French administrations, the PES has had to adjust to the transformation of the models of reference for public action that has been reaffirmed by successive governments as part of the modernising government strategy. The concept of what constitutes effective government action has gradually shifted from the traditional hierarchical organisation to a managerial approach based on the delegation of power, promotion of initiatives, organisational flexibility and cooperation with outside actors. If we analyse the new employment programme launched in the 1990s, we can observe that the programme priorities have involved either improving the internal functioning of the PES (managerial mode of governance) or better regulating co-operations with the other local employment policy ac30 tors (network governance). There has been a lot of uncertainties in the 90s about which model to adopt and about what the internal organisation of the PES should be, both as regards relations between its component bodies (ANPE AFPA - detached offices) and relations between the central administration and the various territorial levels. According to Simonin (2003), clarification dates of 1998 when the chosen ap27 28
IAE: Insertion par lActivit Economique (in English, Integration through economic activity). Over 700 million euros injected by UNEDIC and the PES into the services supply market for the implementation of back to work assistance programmes (excluding training) In many cases, the primary focus has been on meeting the targets for existing measures set by the central government that have been allocated on the basis of simple criteria for each region in order to contain the level of unemployment. The main task of regional and local offices has been to publish these measures and to ensure that they are used in compliance with the legislation. (Simonin, 2003) The first tends to promote a management model within the SPE, broadly based on the development of management by objectives, as the means of enabling deconcentrated central government offices to translate the governments priorities into formalised local strategies and to assume responsibility for coordinating the initiatives of all actors. The second approach is implicitly based on another model that of the central government as an promoter and as a partner (lEtat animateur, see Donzelot and Estbe, 1994: 61) in which the central government actively seeks to promote a greater sharing of responsibilities between local actors and views the quality of the cooperation between them as the key to effective government. 56
29
30
proach was to reaffirm strongly the prime responsibility of the central government and its Dpartements in the field of public employment initiatives, the existence of national priority objectives and the need for improved decentralisation of management. Various reasons explain the uncertainties about which model to adopt: the key political importance of the issue of unemployment in France and the persistent difficulty of reaching results. Successive government have continuously seek to keep control over the main employment policies programmes. The necessity to act rapidly to contain the level of unemployment (in the event of a rapid economic downturn). Evaluation studies have shown that certain types of measures (subsidised jobs in the non market sector) have a more direct and immediate impact on the level of unemployment than other measures with more favourable effects in the medium term. Powerful factor maintaining the previous hierarchical model: PES staff are required to comply with a regulatory framework that is often very precisely defined at the national level for all employment policies measures to enable government to anticipate effectively impacts short term. Distrust, especially by Finance ministry of any organisational change that would give greater flexibility in managing resources unless it was accompanied by a guarantee of improved management control.
Recent developments seem to call this interpretation into question. First of all, because a fourth 31 governance model seems to emerge in France: the market governance. Secondly, because the territorial authorities gains few new competences that could make the difference (training to regions, in particular). The 2003 RMI decentralisation law confers to the Dpartements a role of lead organisation for back to work assistance of social minimum recipients. Furthermore, the 2005-law on social cohesion confers local authority an important coordination initiative role in relation with the set up of employment platforms (maisons de lemploi) at local level (see below). It should be noted that the AFPA is involved in an decentralisation privatisation process. Furthermore, the state at local level have less and less direct tools in hands. And last but not least, the direct connexion made between local economic development and employment gives legitimacy to local authorities to have more and more influence of this policy domain.
3.3.4
The governance issue
Four major difficulties in the handling of unemployment in France have been recently singled out in the CERC report of 2005: A spreading out of responsibilities, within a system which does not succeed in imposing a hierarchy among those of the state, the social partners and the local authorities and making them converge; A dispersal of funding with regard to both the income replacement benefit of workless people (unemployed insurance, unemployed solidarity and minimum income RMI) and the assistance provided for entering or re-entering employment. A fragmentation of operators, whose responsibilities tend to overlap, at the risk of a loss of efficiency.
31
Market governance in this field means a shift of gravity-centre from the intermediation function to the allocation function. That means more role and more influence for institutions paying the unemployment benefits (UNEDIC and General councils). 57
A process of change marked by highly unstable tools, if not policy directions, and a scarcity of preparatory evaluation for decision making and especially ex-post evaluation.
The concept of the maison de lemploi

The law on social cohesion of January 2005 introduce the concept of maison de lemploi. 300 maison de lemploi should be set up before the end of 2007. This term can be best translated by employment platform, rather than employment house or employment centre. A call for proposal is organised at national level and the local project, on initiative of territorial authorities, have to be liaised in order to be granted by State funds. This concept aims at coordinating local employment initiatives rather than bringing the different actors under the same roof. However, many project have construction component aiming at bringer together all services (especially ANPE, ASSEDIC, Mission locale and other services). The main objective of the maison de lemploi is to organise coordination and network management and Services chain management. As such, is has to bee seen as an important coordination tool. Territorial authorities must be at the initiative of the set up of the maison de lemploi. That means that local authorities are greater involved in the territorial employment policy. The maison de lemploi could give an interesting impetuous profoundly reorganise public intervention on the labour market at local level and to bring coherence within this action system. Unemployment in France, more than most European countries, has a very high level of unemployment, especially long term unemployment. In 2004, within the fifteen-member European Unions, only Spain and Greece faced a more serious situation. The French unemployment rate was more than twice as much as those in countries as Ireland, Austria, the Netherlands and UK. And this is a lasting situation which has locked the French Society into mass unemployment. Since 1984, the unemployment rate has never gone below 8.5 %. Unemployment is politically speaking a very hot issue in France. Employment policy in France is massive, and one of the most important policy area. Combating unemployment is the priority of successive government for over 20 years. The money spent on employment programmes is considerable in France: the budget work and employment amounted to more than 13 billion Euro in 2006. The political weight of the unemployment rate largely explains reform options that has been taken in France, especially in respects with the rescaling process.
58
4
4.1
Appendix
Appendix 1: Article 1er de lordonnance du 4 octobre 1945
Il est institu une organisation de la Scurit Sociale destine garantir les travailleurs et leurs familles contre les risques de toute nature susceptibles de rduire ou de supprimer leurs capacits de gain, couvrir les charges de maternit et les charges de famille quils supportent. Lorganisation de la Scurit sociale assure ds prsent le service des prestations prvues par les lgislations concernant les assurances sociales, lallocation aux vieux travailleurs salaris, les accidents du travail et maladie professionelle, et les allocations familiales, et le salaire unique aux catgories de travailleurs protgs par chacune de ces lgislations dans le cadre des prescriptions fixes par celles-ci, et sous rserve de dispositions de la prcdente ordonnance. Des ordonnances ultrieures procderont lharmonisation desdites lgislations et pourront tendre le champ dapplication de lorganisation de la scurit sociale des catgories nouvelles de bnficiaires et des risques ou prestations non prvus par les textes en vigueur.
4.2
Appendix 2: CMU
The (CMU) provides a basic health coverage for people lawfully living in France on a stable basis, who are neither covered by their professional activity nor an eligible party of someone assured. To be affiliated to social health assurance people need to lodge a request with a state health insurance office. People whose tax income is higher than a given limit (fixed by a decree) have to pay an annual contribution of 8% of the total amount of excess revenue. People whose tax revenue is lower, such as RMI recipients, are exempted from contribution. A complementary scheme, based on residence as the CMU, but means-tested, was also set out. RMI recipients were automatically transferred to the CMUC on January 1, 2000. The CMU provided coverage to more than 1,5 million people on 31 December 2003, 500.000 people more than at the time it came into effect (Boisgurin, 2005). The number of recipients of the CMU Complmentaire rose to 4,7 million in 2004, with an average cost of 320 Euro per recipient (Fonds CMU, 2005).
4.3
Appendix 3: RMI recipients
The number of beneficiaries increased year after year (Mandin/Palier, 2002: 32): + 14.4% in 1991, + 15.3% in 1992, + 18.4% in 1993, +14.7% in 1994, +4.1% in 1995, + 6.9% in 1996. It diminished for the first time in 2000 (-4.3%) but since 2002 the number increased again.
59
Table 12
Year 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Number of RMI recipients

Mtropole 324,593 408,241 473,617 558,434 678,448 783,436 820,115 882,047 933,998 969,039 993,075 940,587 916,738 929,268 975,272 1,061,005 DOM 71,567 88,044 93,939 96,208 96,355 105,033 105,171 106,668 111,305 118,822 127,176 131,671 134,987 139,655 145,572 154,580 Total 396,160 496,285 567,556 654,642 774,803 888,469 925,286 988,715 1,045,303 1,087,861 1,120,251 1,072,258 1,051,725 1,068,923 1,120,844 1,215,585 25.3 14.4 15.3 18.4 14.7 4.1 6.9 5.7 4.1 3.0 - 4.3 - 1.9 1.6 4.6 7.8 Evolution annuelle (en %)
Source: CNAF, fichier FILEAS, on 31 december on each year (except MSA). In 2003, 50.9% of the beneficiaries were women and 22,7% were under 30 years old.
In 2000, 1,072,258 persons received the RMI (2004: 1,215,585). The number of beneficiaries seems to be unevenly allocated on the territory (Cazain et al., 2004: 12): by 31 December 2003, a quarter of beneficiaries in metropolitan France concentrated in five Dpartements.
Table 13
Age
Main characteristics of RMI recipients (in %), December 2003

22.7 27.1 26.8 23.3 49.1 50.9 43.9 21.3 7.0 27.8
Under 30 years old 30-39 years 40-49 years 50 years old and more Gender Men Women Marital status Without children Single-parent families Couples without children Couples with children Source: DREES, enqute auprs de bnficiaires de minima sociaux, 2003.
60
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Pinson, Gilles/Le Gals, Patrick (2005) State restructuring and decentralisation dynamics in France: politics is the driving force, Cahier europen du ple Ville/metropolis/cosmopolis 07: 26p. Raynaud, Denis (2005) Les dterminants individuels des dpenses de sant: linfluence de la catgorie sociale et de lassurance maladie complmentaire, Etudes et rsultats, n378: 12p. Sadran, Pierre (1992) Le systme administratif franais. Paris: Montchrtien. Seillier, Bernard (2003) Commission des Affaires sociales: Projet de loi portant dcentralisation en matire de revenu minimum dinsertion et crant un revenu minimum dactivit. Paris: Snat. Simonin, Bernard (2003) France: Providing greater Flexibility at Local Level, pp. 219-249 in OECD, Managing Decentralisation. A new Role for labour Market Policy. Paris: OECD. Simonin, Bernard (2005) Formal Contracting with Providers in France: a technical Approach with higher Political Stakes today, pp. 281-305 in Sol, Els/Westerweld, Mies (dir.) Contractualism in Employment Services. A new Form of Welfare State Governance. The Hague: Kluwer Law International;. Sol, Els/Westerweld, Mies (dir.) (2005) Contractualism in Employment Services. A new Form of Welfare State Governance. The Hague: Kluwer Law International. Taylor-Gooby, Peter (2001) The Silver Age of the Welfare State: Resilience and Contingency, Presented at: Hellenic social Policy Association Inaugural Conference, May 10-13, 2001, Democritus University of Thrace. Retrieved 11 December 2005 from the World Wide Web: http://www.bath.ac.uk/~hsstp/elepekp/Paper_Taylor_Gooby.doc Tugores, Franois (2005) Les tablissements dhbergement pour personnes ges en 2003: activit et personnel - Premiers resultants de lenqute EHPA 2003, Etudes et rsultats, n379: 8p. . Tuchszirer, Carole (2003) Government proposes reform and decentralisation of minimum integration income scheme. Retrieved 12 January 2006 from the World Wide Web: http://www.eiro.eurofound.eu.int/2003/06/feature/fr0306103f.html Vasselle, Alain (2003) Commission des Affaires sociales du Snat: La CADES: nouvel enjeu des finances sociales ?. Rapport dinformation n248, Paris: Snat. Vernet, Sylvette (2000) Economic newsletter. Retrieved 11 January 2006 from the World Wide Web: http://economic-research.bnpparibas.com/applis/www/RechEco.nsf/0/ 50A43C24A8835A4B41256A03003537BA/$File/Lcamai00.pdf?OpenElement Donzelot Jacques & Estbe Philippe (1994) LEtat animateur, essai sur la politique de la ville, Paris: Esprit.
Laws:
1. Loi n88-1088 du 1er dcembre 1988, relative au revenu minimum dinsertion ; version consolide au 31 dcembre 2003 - Modifie par la loi n2003-1311 du 30 dcembre 2003 art. 119 II 1 finances pour 2004. Loi n 2003-1200 du 18 Dcembre 2003 portant dcentralisation du Revenu minimum dinsertion et crant un Revenu minimum dactivit. Loi n 2005-32 du 18 janvier 2005 de programmation pour la cohsion sociale.
2. 3.
64
Internet websites:
1. 2. 3. 4. 5. 6. 7. 8. CNAV (the National Old-age Insurance Fund): http://www.cnav.fr/ CNAF (the National Family Allowance Agency): http://www.caf.fr/ Eurostat: http://epp.eurostat.cec.eu.int/portal/page?_pageid=1090,1&_dad=portal&_schema=PORTAL INSEE (National Institute for Statistics and Economic Studies): http://www.insee.fr/fr/home/home_page.asp La documentation franaise: http://www.ladocumentationfrancaise.fr/ Ministre de lemploi, de http://www.cohesionsociale.gouv.fr/ la cohsion sociale et du logement:
Ministre de lemploi, de la cohsion sociale et du logement, site de la DREES (Direction de la Recherche, des tudes, de lvaluation et des statistiques): http://www.sante.gouv.fr/htm/publication/pub_drees.htmMinistre de lconomie, des finances et de lindustrie: http://www.cohesionsociale.gouv.fr/ Ministre de la sant, de la famille et des personnes handicapes: site consacre aux personnes ges: http://www.personnes-agees.gouv.fr/ MISSOC (Mutual information system n social protection): http://europa.eu.int/comm/employment_social/social_protection/missoc_en.htm OECD: http://www.oecd.org/home/0,2605,fr_2649_201185_1_1_1_1_1,00.html UNIOPSS (Union nationale interfdrale des uvres et organismes privs sanitaires et sociaux): http://www.uniopss.asso.fr/cgi/index.plx
10. 11. 12. 13.
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Rescaling Social Welfare Policies A comparative study on the path towards multi-level governance in Europe

Rescaling Social Welfare Policies in France

Noisy-Le-Grand Strasbourg February, 2006

Rescaling Social Welfare Policies

National Report France

2.5 2.6 3 3.1

Rescaling Social Welfare Policies

National Report France

3.1.3 3.1.4 3.2

Active assistance Decentralisation of the RMI

4 4.1 4.2 4.3

Rescaling Social Welfare Policies

National Report France

Rescaling Social Welfare Policies

National Report France

Changing contexts: demography, economy, society, politics

3. Marseille-Aix-en-Provence 1.5 million 4. Lille 5. Toulouse 1.2 million 1 million

Birth rate, participation rates and family composition

Rescaling Social Welfare Policies

National Report France

Evolution of female employment as a percentage of the female population at working-age, 1984-2003

Source: OECD (2004), Labour Force Statistics 1983-2003, Paris.

Rescaling Social Welfare Policies

National Report France

Poverty and inequalities

The State, its organization and normative foundation

Rescaling Social Welfare Policies

National Report France

Rescaling Social Welfare Policies

National Report France

Reinforcing the role of the State

Activation of social expenditure

Rescaling Social Welfare Policies

National Report France

Social assistance renewal

New income support policy: temporary benefits

Rescaling Social Welfare Policies

National Report France

Decentralisation: an attempt to revive social assistance

Rescaling Social Welfare Policies

National Report France

The providers of social and social-medical services

Rescaling Social Welfare Policies

National Report France

91% for disabled adults

The Market, commodification and labour market performance

Structure of unemployment by duration (2002)

Average duration of unemployment (months) ILO unemployment rate

Rescaling Social Welfare Policies

National Report France

Structure of unemployment by age and sex (2002)

A changing job market

Rescaling Social Welfare Policies

National Report France

Source: OECD (2004), Labour Force Statistics 1983-2003, Paris.

Rescaling Social Welfare Policies

National Report France

Institutional analysis: actors and governance arrangements

This section is mainly based on Cole, 2003: 14. 17

Rescaling Social Welfare Policies

National Report France

Identification of the territorial institutions and their developments

The central State, key component of the French system of governance

Rescaling Social Welfare Policies