CAF cuts

The French government is taking a leaf out of David Cameron's book and looking to cut child benefits in order to reduce the welfare deficit.

The CAF (Caisses d'Allocations Familiales) needs to make €2.2billion worth of saving to balance its books and the shortfall is expected to rise to some €1.7 over the next three years.

According to Prime Minister Jean-Marc Ayrault around €15billion worth of benefits are distributed without any means testing and even when means testing comes into play the ceilings may be set too high.

He is now looking at two options: cutting benefits to better off families or limiting per child tax allowances to €1,500, which would effectively tax benefits to better off families.

This would breach the principal of 'universal aid' but Ayrault insists that it would lead to a fairer distribution of benefits.

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