“This is the biggest increase for 37 years”, exclaimed Stanislas Guerini on Twitter, Tuesday, June 28. The Minister of Transformation and Public Service announced an increase in the value of the public service index point by 3.5% from July 1. “The government is strengthening the purchasing power of civil servants”, also welcomed government spokeswoman Olivia Grégoire.
Faced with the unprecedented level of inflation, we took an exceptional measure: the general increase in the index point of the #Public service by 3.5%.
This is the biggest increase for 37 years! pic.twitter.com/4ihuzzoqM1
— Stanislas Guerini (@StanGuerini) June 28, 2022
This line of government communication was quick to react. “Dear cousin… No, it’s the loss of purchasing power of civil servants that will be historic. Kisses”, replied the sociologist Mathieu Grégoire to the government spokesperson. So, historic rise in the index point or equally historic loss of purchasing power? Who says true or “fake”?
With a 3.5% increase in the value of the index point, on which the civil service salary scale is indexed, Stanislas Guerini is right to say that this is the largest annual increase since 1985. However, this increase does not mean an equivalent increase in the purchasing power of civil servants.
“We are facing the biggest rise in inflation for 40 years. We have to look at the index point in relation to inflation”, underlines for franceinfo Eric Heyer, economist at the OFCE. However, inflation reached 5.8% over one year, according to the latest provisional estimate from INSEE. For civil servants, the revaluation of the index point by 3.5% does not therefore compensate for the rise in prices. The gap between the two remains 2.3 points.
Mathieu Grégoire is therefore not wrong to affirm that the loss of purchasing power promises to be significant over the year for civil servants, even if the record remains the year 1986, with a 2.7 point difference between the level of the index point and that of inflation. Since the mid-1980s, the rise in the index point has erased inflation only nine times, always by less than one point and for the last time in 2016.
In the civil service, however, remuneration does not depend solely on the index point. It is also fixed according to the level of the civil servant. The government therefore intends to rely on individual increases to maintain the purchasing power of its agents. “The increase in the index point of 3.5%, added to the average individual increases of 1.5% per year therefore represents an average increase of 5% in the remuneration of civil servants”, calculates Stanislas Guerini on Twitter. However, “if you stagnate on the grid, your purchasing power will drop”notes Eric Heyer.
The government also resorts to individual compensation. In its report of the Salary Conference 2022 (PDF), the Ministry of Transformation and the Public Service is thus putting forward measures targeted at certain categories of agents. Among these, the renewal of the Individual Purchasing Power Guarantee (Gipa), “an allowance paid for all agents whose gross index salary would have evolved less quickly than the consumer price index, cumulatively, over a period of 4 years”.
“With individual compensation (Gipa), agents who are already on the grid do not lose purchasing power. On the other hand, for civil servants who pass the competitive examination, there is no individual compensation and the grid is less and less attractive compared to the possibilities in the private sector”, notes the economist at the OFCE Guillaume Allègre. The ministry is also announcing salary increases at the start of their career, aid for soft mobility and a contribution to the catering costs of public officials. According to the government, the unfreezing of the index point, combined with these measures, should make it possible to maintain the purchasing power of civil servants.
The revaluation of the index point to 3.5% is also to be put into perspective in view of the frost maintained under Emmanuel Macron’s first five-year term. The last revaluation dates back to 2017, under the presidency of François Hollande. In a press release dated June 28the Solidaire Public Service union thus denounces an insufficient increase which does not cover either inflation for 2022 or the cumulative loss of purchasing power since 2017.
Over the course of presidential mandates and legislatures, the revaluation of the index point of civil servants has been increasingly low. It fell at the end of François Mitterrand’s presidency under cohabitation, stagnated under Jacques Chirac, then fell again under Nicolas Sarkozy and François Hollande.
Since the early 1990s, the purchasing power of civil servants has been eroded by fluctuations in inflation. “Until now, the government has relied on low inflation, but which has been accumulating every year, to reduce the civil service salary grid. This has gone relatively unnoticed from one year to the next., explains Guillaume Allègre. Over twenty years, this represents a significant loss of salary. The return of very high inflation forces the government to increase the index point.