Using money from Livrets A to finance companies working for Defense: this is the objective of a bill presented today in public session to the Assembly. This interest in the hundreds of billions of euros in settlement books is not new. But we cannot draw from it freely. Here’s how it works.
Do you know the Savings Fund? If you are equipped with a Livret A, like 8 out of 10 French people, he, in any case, knows you. It is, in fact, in this common pot, managed by the Caisse des Dépôts et Consignations (CDC), the financial arm of the State, that the majority of the money that you deposit in your Livret A accounts is centralized, LDDS and LEP. Its mission is then to transform these funds into very long-term loansintended to finance areas designated as of general interest.
You probably know at least one: the social housing. Since 1894, money from Livret A has been used to finance the construction of new low-rent housing, allocated on social criteria. A sign of solidarity which allows us to understand, in part, a certain attachment to this unparalleled savings product.
Financing social housing, however, is far from being the only use made of money from settlement books. The latest report from the Savings Fund is there to remind us: out of 100 euros invested, only 31 euros (31.25% precisely) are loaned to social landlords. Or 174.3 billion euros, out of the nearly 558 billion deposited, at the end of 2022.
And the rest of the money? It is from this windfall that the bill, tabled by Horizons MP Christophe Plassard, wishes to draw on to improve the financing conditions of Defense companies, today faced with frequent refusals from the banks. Against the advice of the Minister of the Economy, who would prefer to create a specific product, but also against public opinion. Our exclusive survey (1), produced by YouGov France last November, indicates that only 29% of you are convinced by the idea. To choose, you prefer that this money benefits the public hospital (61% approval), the school (43%) or the police (21%).
Booklet A: the French do not want their money to finance defense
225 billion euros for banks
Financing Defense thanks to the Livret A and its cousins is however already possible. Part of the windfall from regulated savings remains in the banks which distribute and maintain the accounts: 40.5% of deposits for Livret A and LDDS, 50% for LEP. At the end of 2022, this represented around 225 billion euros.
Of course, the banks cannot do what they want with this money. The regulations require them to focus on financing small and medium-sized businesses (80% of outstandings), towards ecological projects (10%) or actors in the social and solidarity economy (5%).
Nothing prevents them, however, from using the remaining 5% (11 billion euros, all the same) to finance the Defense industry. Nor even to use part of the 80% dedicated to SMEs towards companies in this sector. Which today they do not do, or not sufficiently according to the designer of the text.
The purpose of the bill is therefore to twist their arm, by adding the financing of companies, particularly small and medium-sized, in the French defense industry to the list of these targeted jobs, according to its explanatory memorandum.
Savings: The Livret A to finance defense, the subject is back on track
4.6 billion euros in interest paid to savers, more than a billion to banks
The Savings Fund pays savers the interest on the deposits it centralizes. In 2023, this should represent nearly 11 billion euros, much more than in 2022 (4.6 billion euros) or than in 2021 (1.5 billion). Logical, since last year, the rates were at their highest, and so was the collection.
The Savings Fund also remunerates the banks which collect the money and keep the accounts, up to 0.30% of the centralized amounts for the Livret A and the LDDS, and 0.40% for the LEP. This additional interest reached 1.278 billion euros in 2022, an increase of 28 million euros, and is expected to increase further in 2023.
Livret A: how much do banks earn from your deposits?
325 billion euros for the Savings Fund
The rest of the money from Livrets A, LDDS and LEP is therefore centralized in the Savings Fund. This war treasure exceeded 325 billion euros at the end of 2022. figure up more than 9% over one year and which will increase further in 2023.
Vincent MIGNOT
After a master’s degree in History then a master’s degree in Information and Communication Sciences, Vincent MIGNOT became a journalist in… Read more
MoneyVox / VM / March 2024