To reduce the amount of its borrowings, the State has asked an expanded list of public bodies to deposit their cash in its centralized cash account. An order to this effect was presented on December 2, 2020, as revealed by the Reuters news agency.
An extended list of public bodies
As indicated in the order seen by Reuters, the government has extended to more public bodies the obligation to deposit their cash in its treasury account.
"In a context marked by a sharp rise in indebtedness resulting from the unprecedented demands placed on the public authorities to cope with the consequences of the health crisis, the present order aims to extend the obligation to deposit funds with the Treasury to certain organizations that were previously exempt", reads an official document appended to the order.
From October 1, 2021, public bodies such as Pôle Emploi, Agence nationale pour la rénovation urbaine (ANRU), Commissariat à l'énergie atomique, France Compétences, Fonds de garantie des dépôts et de résolution (FGDR) and Académie française will be required to deposit their assets with the French Treasury.
This policy of giving public bodies access to cash is not new, but the list has grown longer over the years.
150 billion euros of available reserves
According to the ordinance, access to the liquid assets of public bodies has enabled the State to avoid "200 billion euros in public debt, including 70 billion in cumulative interest charges between 2000 and 2020". The amount of available reserves is estimated at over 150 billion euros, enabling the State to reduce borrowing during this period of health crisis and avoid calling on the markets.
"This lower level of indebtedness enables the State to reduce its financing needs, and thus to minimize the cost to the French people, thus helping to limit the level and cost of the debt," explains the ordinance.
In 2019, the amount of accounts opened at the Treasury was 128.4 billion euros, with 60 billion euros in deposits from local authorities, 28 billion from national public establishments, 15 billion from African franc zone central banks and 5.6 billion from hospitals. Almost half of the increase between 2019 and 2020 is due to the Caisse d'amortissement de la dette sociale, which tripled the amount of its deposits at the Treasury.