Government seeks to stabilize apprenticeship funding through financial reforms
Rewritten Article:
Emmanuel Macron's first term has seen a significant success in apprenticeship reform, but it's come at a hefty price for the state. After a five-month consultation with social partners, the Labour Minister, Astrid Panosyan-Bouvet, unveiled a plan on April 30 to make the scheme more financially stable.
The government is determined to carry on the momentum of apprenticeship growth initiated in 2018 with the law for choosing one's professional future. As a result, the number of contracts in the private sector skyrocketed from 290,000 in 2017 to an expected 854,000 by 2024. However, this enthusiasm has put a strain on the country's finances, as the Court of Auditors has pointed out numerous times.
The plan consists of two main pillars: prioritizing funding for apprenticeships according to labor market needs and enhancing the financial stability of the scheme. Since January, hiring bonuses for apprentices have been reduced, with companies employing fewer than 250 employees receiving €5,000 and all others receiving €2,000. Now, the government is focusing on the funding of apprentice training centers (CFA) and launching an anti-fraud initiative. The expected savings by 2025 are between €450 million and €500 million.
(Insight: These savings are expected from various measures, such as labor market alignment adjustments, narrowing tax exemptions for mutual insurance companies, expanding social contributions for salaries above the minimum wage, and tightening eligibility for the CPF to exclude non-vocational trainings.)
In terms of labor market alignment, companies hiring apprentices for higher diploma levels must now contribute financially to the apprenticeship contracts, discouraging over-qualification mismatches. Additionally, branches can reduce funding for apprenticeship contracts when training is partially conducted remotely, promoting quality in-person training.
Financially, mutual insurance companies’ exemptions are now limited to apprentices' salaries, increasing employers' contributions. For contracts signed from March 2025, salaries exceeding 50% of the SMIC (minimum wage) will incur CSG/CRDS and social security contributions, reducing state liabilities.
To combat fraud, the mandatory employer contribution for advanced apprenticeships and reduced remote training subsidies create tighter accountability, discouraging misuse of funds. Furthermore, non-certified business advisory trainings are excluded from the CPF unless certified (RNCP/RS), reducing non-vocational misuse of training funds.
(Insight: While the reforms seek to balance employer flexibility with fiscal responsibility, specific anti-fraud mechanisms beyond eligibility tightening are not detailed in the available documents.)
The objective of these reforms is to focus apprenticeships on higher-value qualifications and increase their financial sustainability. Overall, the reforms aim for a more effective and responsible apprenticeship scheme without hindering growth.
- Despite the successful growth in apprenticeships during Emmanuel Macron's first term, the government aims to make the scheme more financially stable, as revealed by Labour Minister Astrid Panosyan-Bouvet in April 2021.
- To enhance financial stability, the plan introduced on April 30, 2021, prioritizes funding for apprenticeships according to labor market needs and focuses on the funding of apprentice training centers (CFA) and launching an anti-fraud initiative.
- By 2025, the government aims to save between €450 million and €500 million from various measures, such as labor market alignment adjustments, narrowing tax exemptions for mutual insurance companies, and expanding social contributions for salaries above the minimum wage.
- As part of the reforms, Bouvet introduced new regulations aimed at combating fraud, including a mandatory employer contribution for advanced apprenticeships, reduced remote training subsidies, and exclusion of non-certified business advisory trainings from the CPF unless certified (RNCP/RS).
