Key Benefits:
The Constitutional Council has received, by more than sixty members, an appeal against the law on decentralization in respect of minimum income for insertion and creating a minimum income of activity, adopted on 10 December 2003.
The Grievors articulate against sections 2, 4, 6, 14 and 43 of the Act various grievances that call for the following comments from the Government.
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I. - Articles 2, 4, 6 and 14
A. - Sections 2, 6 and 14 of the deferred Act, together with others, decentralize the minimum income of insertion. Article 2, which repeals the 3rd of Article L. 121-7 of the Code of Social Action and Families as well as Article L. 262-4 of the same Code, decides the repeal of the provisions which today put the financing of the minimum income allowance for insertion at the expense of the State. Articles 6 and 14, which amend various articles of the code of social action and families by substituting the President of the General Council to the representative of the State in the department, have the effect of transferring to the department the responsibility for the implementation of the minimum income system of insertion and empowering the President of the General Council to make the individual decisions related to it. Section 4, for its part, provides that the resulting expenses for the departments of transfer and skills development are compensated according to the conditions laid down by the Financial Law.
Against these provisions, the authors of the appeal first argue that they would ignore the terms of the tenth and eleventh preambular paragraphs of the Constitution of 27 October 1946 and that they would be contrary to the principle of equality. They also argue that the provisions of Article 4 of the Act referred to above would be contrary to Articles 72 and 72-2 of the Constitution as a result of the Constitution Act of 28 March 2003.
B. - These various grievances are unfounded.
1. In the first place, the criticized provisions of the law referred to do so do not affect the constitutional requirements of the 10th and 11th preamble to the Constitution of 27 October 1946 and cannot be further considered contrary to the constitutional principle of equality.
The tenth paragraph of the 1946 Preamble states that the nation provides the individual and his family with the necessary conditions for their development. The eleventh preambular paragraph of 1946 states, for its part, that the nation guarantees all the protection of health, material security, rest and leisure, and that every human being who is, because of his age, physical or mental state, of the economic situation, in the impossibility of working, has the right to obtain from the community adequate means of existence. It is the legislator's responsibility, however, within the framework of its discretion, to determine the modalities for the implementation of the principles proclaimed by the Preamble.
The Constitutional Council has already recognized that these principles do not, by themselves, obstruct the institution by the legislator of solidarity mechanisms implemented by local authorities, including departments (Decision No. 96-387 DC of 21 January 1997). In addition, it is important to note that the constituent power, by adopting the Constitution Act of 28 March 2003 on the decentralized organization of the Republic, has indicated that the territorial authorities have a vocation to exercise more competence, with regard to those that can best be implemented at their level.
It must be considered, when the principles laid down by the 1946 Preamble are at issue, that it still belongs to the legislator, even after the intervention of the constitutional law of 28 March 2003, to prevent by appropriate provisions the occurrence of breaks characterized by equality in the implementation by territorial authorities of the powers entrusted to them. In particular, it may be considered that it should go so in the area of social assistance allowances that meet a requirement of national solidarity, implemented by the departments (Decision No. 96-387 DC of 21 January 1997; Decision No. 2001-447 DC of 18 July 2001).
But, in the present case, there is no doubt that the legislator has taken the appropriate measures to prevent the attribution to the departments of the implementation of the minimum income of insertion from resulting in breaches characterized by equality.
In this respect, it must be emphasized that the minimum income of insertion remains a right for all those who meet the conditions set out in its allocation and that these conditions of attribution, including the age, resources and composition of the home, such as the amount and the scheme of the allocation or the rules relating to the repetition of undue allowances, remain fixed by the legislator or by the general regulatory authority. These essential scoping elements remain determined for the entire national territory by state authorities. It may be added that the State will assume control over the implementation of the system by the departments, through the monitoring of the legality exercised by the prefects and through the monitoring missions carried out by the general inspection of social affairs. Finally, the State remains responsible for the follow-up of policies on the allocation and insertion of beneficiaries of the minimum income of insertion; For this purpose, the bill referred to has provided for the transmission to the prefect, by the president of the General Council, of accounting data and information relating to beneficiaries and benefits.
It must also be noted that individual decisions, now taken by the President of the General Council, remain subject to challenge before social assistance courts. Decisions of refusal or decisions that suspend or terminate the payment of the allowance shall, in fact, be motivated under the general provisions of the Act of 11 July 1979 relating to decisions that refuse an advantage whose allocation constitutes a right and those that withdraw or repeal a rights-creating decision.
2. Secondly, the criticism addressed to the law referred to on behalf of the fourth paragraph of Article 72-2 of the Constitution, derived from the Constitution Act of 28 March 2003, can only be dismissed.
(a) It is indeed inoperative. It is true that the new constitutional provisions now provide that any transfer of powers between the State and the territorial authorities must be accompanied by the allocation of resources equivalent to those devoted to their exercise. They also provide that any creation or extension of competencies resulting in an increase in the expenses of territorial authorities must be accompanied by resources determined by law.
But the implementation of these provisions must necessarily be carried out in accordance with the respective competences of the law and the law of finances as defined by the Constitution and the organic provisions relating to financial laws. However, the allocation of resources equivalent to those dedicated to the exercise of the transferred powers is likely, depending on whether the legislator chooses within the framework of its discretion to retain a type of public resources or another, to rise from the exclusive scope of the finance law. It may thus come to the effect that the provisions for transfer of competence and those for allocation of resources are not included in the same text. It is then necessary, and it is sufficient, in order to satisfy the constitutional obligation to "accompany" the transfer of competences from a resource allocation that the coming into force of the legislative text proceeding to the transfer of competence is subordinate to the coming into force of the finance law deciding on the transfer of resources.
This is precisely the subject of the provisions of sections 4 and 52 of the referred law. Section 4 provides that the expenses resulting from the departments of the powers transferred or created by law are compensated by the award of a portion of the proceeds of a tax collected by the State under the conditions laid down by the Financial Act and section 52 explicitly provides for the entry into force of the law referred, in principle as of 1 January 2004, at the entry into force on that date of provisions voted by the financial legislator. By adopting these two provisions, the legislator has satisfied, with respect to the law referred to, the obligations that may result in the provisions of the fourth paragraph of Article 72-2 of the Constitution. Any other criticism addressed to the law referred to on behalf of the fourth paragraph of Article 72-2 of the Constitution is inoperative.
This is particularly true of the fact that the amount of resources transferred by the Finance Act would be insufficient to cover expenses resulting from the transfer or creation of competencies. The determination of the resources allocated for the transfer and creation of competencies decided by the law referred to is the subject of section 40 of the 2004 Finance Bill, which is currently under discussion in Parliament. An argument that contests the amount of resources allocated could undoubtedly be invoked in support of a challenge to this section of the finance law, once this law has been finally passed. However, such an argument is lacking in scope with respect to the bill referred to by itself, and cannot properly include without disregard the exclusive jurisdiction of the financial legislator, any provision relating to the amount of resources transferred.
(b) However, it should be noted that the allocation of resources as provided for in section 40 of the 2004 Finance Bill is in any event fully satisfied with the constitutional requirements resulting from the fourth paragraph of section 72-2 of the Constitution.
This paragraph distinguishes, in fact, the case of transfer of competence between the State and the territorial authorities and the case of the creation or extension of competence of these communities. With regard to the transfer of competence, the Constitution explicitly states that the determination of the amount of resources allocated is based on the resources that "are devoted to their exercise", that is, those that were actually devoted by the State to the exercise of these powers before the transfer. And if it is lawful for the legislator to determine, within the framework of its political discretion, more favourable provisions for the benefit of the territorial authorities or to provide rules on the evolution in the time of these resources, the Constitution does not impose any other obligation than that of assigning resources equivalent to those that were consecrated by the State on the date of the transfer of competence; Nor does any constitutional rule require updating the amount of these resources.
With respect to new powers created or extended by law, the Constitution imposes the obligation to allocate resources only to the extent that these creations or extension of competences have the effect of increasing the expenses of the territorial authorities; it leaves the legislator with a broad authority to assess the type and evaluation of the public resources considered; This obligation is indeed enforceable, as the Constitutional Council has already ruled (Decision No. 2003-474 DC of 17 July 2003; Decision No. 2003-480 DC of 31 July 2003 only to the creation of mandatory skills and not to provisions that relate to the exercise by communities of discretionary skills.
In the present case, section 40 of the 2004 Finance Bill provides for a tax-sharing between the State and the departments, in the form of an assignment to the departments of a fraction of the domestic tax on petroleum products (TIPP) applied to each fuel hectolitre consumed throughout the national territory. In accordance with Article 36 of the Organic Law of 1 August 2001 on the Financial Laws, the allocation of all or part of a State resource to other communities can only result from a financial law provision.
On an interim basis, the rate fraction of the TIPP will be determined, for all departments, from the fuel volumes consumed in 2003 and the State's expenditure in 2003 for the allocation of the minimum insertion income. At the stage of the 2004 Finance Bill, the determination of this interim portion is based on the revenue and expenditure forecasts for 2003. Each department will receive a percentage of the product allocated globally to the departments, corresponding to the share of the expenditures carried out by the State in 2003 under the allocation of the minimum income of insertion reported to the total amount of these expenditures throughout the departments. The legislator, as part of its discretionary authority, has provided that the finalization of the fraction of tariffs allocated to departments will be carried out on the basis of the minimum insertion income expenditure and the actual ITPP product in 2003 and is expected to be the subject of a provision in the Corrective Finance Act for 2004. If, on the other hand, a final adjustment has been made to the departmental administrative accounts for 2004, it must be emphasized that the adoption of such a mechanism is not implicated by a constitutional requirement.
Finally, we must mention that the TIPP has been retained because of its stability and the volatile nature of its bases. In addition, it is estimated that fuel consumption will increase from 2003 to 2004, so that the amount of revenues transferred to the departments under the TIPP should exceed by approximately EUR 80 million the amount of the charge of the minimum income of insertion and the minimum income of activity.
3. Third, the Constitutional Council cannot endorse the criticism drawn from the fifth paragraph of Article 72-2 of the Constitution.
This criticism seems, in any case, premature. If it had been decided to establish a mechanism of equalization, it was in the finance law that he would normally have found his place, with the compensation scheme.
In addition, it should be noted that the referral is misunderstood in the scope of the last paragraph of Article 72-2 of the Constitution when it argues that the legislator would be required to provide equalization in each case.
Indeed, it is important to distinguish between the fourth and fifth paragraphs of Article 72-2 and to measure precisely what their respective scope is. The fourth paragraph sets out a specific constitutional rule - that of the financial compensation of transfers of competence between the State and the territorial authorities - whose respect is required to the legislator on a case-by-case basis, for each transfer of competence, under the supervision of the Constitutional Council. The fifth preambular paragraph expresses, for its part, a constitutional objective and empowers legislators to establish equalization mechanisms to promote equality between territorial authorities. This objective is necessarily more comprehensive; As the Constitutional Council has already ruled, the last paragraph of Article 72-2, which is intended to reconcile the principle of freedom with the principle of equality, does not require that each type of resources be equalized (Decision No. 2003-474 DC of 17 July 2003). Compensation and equalization are thus two distinct operations and are subject to different constitutional provisions.
The deferred law carries out a transfer of State powers to the departments. It is therefore important that, in a correlative manner, under the above-mentioned terms, departments be allocated resources to meet the requirements of the fourth paragraph of Article 72-2. On the other hand, the deferred law having no purpose for the establishment of equalization devices, the invocation of the fifth paragraph of section 72-2 is without scope. There was no constitutional requirement for legislators, in this case, to establish a mechanism for equalization.
II. - On Article 43
A. - Article 43, relating to the minimum income of activity, inserts into the Labour Code ten articles that determine the regime of a new category of labour contracts called "minimum income contract of activity (CIRMA), intended to facilitate the social and professional insertion of persons who are beneficiaries of the minimum income allowance of insertion meeting particular difficulties of access to employment. These contracts are part of the integration path provided for in Article L. 262-38 of the Code of Social Action and Families.
The authors of the appeal criticize these provisions by invoking the principle of equality and the terms of the eleventh preamble to the Constitution of 27 October 1946. They further argue that they would ignore individual freedom and contractual freedom.
B. - Such an argument cannot be accepted.
1. The deferred law creates a new type of specific work contract for people who have benefited from the minimum integration income for a certain period of time. This contract presents the character of a real fixed-term and part-time employment contract, while being supported by the department.
It gives rise to a minimum income equal to the product of the minimum wage of growth by the number of hours worked. This minimum income of activity is paid by the employer, who receives the Department equal assistance in the amount of the minimum income of insertion for an isolated person after the fall of the housing package. For the duration of the contract, the amount of the minimum income allowance for insertion is reduced from the amount of the department's assistance to the employer, but all members of the allotted home retain the rights guaranteed to the beneficiaries of the minimum income of insertion. The rights associated with this income, in particular the supplementary universal health coverage, are explicitly maintained.
This contract of employment is likely to be concluded by most employers in the commercial sector and the non-market sector, with the exception of particular employers as well as State and department services. In addition, these contracts may not be entered into or terminated for economic reasons by employers in the preceding six months or by employers who are not up to date on payment of their social contributions and contributions. Nor can the conclusion of such a contract result from the termination of an employee under an indefinite contract. The law still subordinates the conclusion of the contract to that of an agreement between the employer and the department specifying the objectives of occupational insertion of the employee, the actions of tutoring, individualized monitoring, accompaniment and training that will be put in place by the employer.
The institution of these new contracts is designed to facilitate the professional integration of alloyees of the minimum income of insertion, in particular those who have not recently or have never been employed, and who are not at the outset likely to enter into a common labour contract with an employer. For allocataries, pay more important than the only minimum income allowance for insertion is incentive without deterring ordinary employment. For employers, the lower cost of this type of employment contract is justified by the specific nature of employment that incorporates an aspect of reintegration and training and is characterized by less productivity.
2. In terms of social rights, it must be emphasized that the holders of the minimum income of activity are affiliated with the general social security regime and benefit from the benefits of this scheme for all risks (malaria, maternity, disability, death, work accidents and occupational diseases, old age). They also benefit from unemployment insurance benefits.
It is true that the amount of some of the benefits served will be limited, because the social contribution base taken into account will itself be less than the common law base. According to section L. 322-4-15-7 of the Labour Code resulting from section 43 of the Act referred, the contribution count will, in fact, be limited to the share of the remuneration that is actually borne by the employer, that is, the amount of the minimum income of activity diminished of the amount of assistance paid by the department. As a result, the level of entitlements to cash benefits that are calculated on the basis of the amount of the contribution base will be reduced due to the decrease in the base. On the other hand, however, it may be noted that the legislator has provided for measures for the holders of the minimum income of activity that are more favourable than the provisions of the common law: thus it is the maintenance of the remuneration by the employer in the event of sick leave, work accidents or occupational illness, maternity, paternity or adoption leave (see article II of article L. 322-4-15).
These various features are not constitutive of an infringement of the constitutional principle of equality. They reflect the fact that the minimum income of activity covers both a lump sum social assistance allowance, paid by the employer but supported by the department, and an effective compensation from the employer, fixed at a low level but adapted to the actual productivity of the contract holder. In this regard, it cannot be observed that the beneficiaries of the minimum income of activity are in a different situation than that of employees of common law, because of their lower employability and the actions defined by law, which the employer must carry out in favour of their reintegration. This specific situation explains the particular structure of the remuneration of these derogatory labour contracts; this difference of situation justifies the difference of treatment. The general interest in reintegrating into the labour market for those who have been permanently excluded must also be emphasized.
3. Finally, the grievance stemming from the lack of knowledge of individual freedom and of contractual freedom lacked seriousness. The provisions of the referred law that create a new type of labour contract in order to facilitate the social and professional reintegration of certain allocataries of the minimum income of insertion do not in any way implicate individual freedom as recognized in the Constitution. They do not infringe the terms of Article 2 of the Declaration of Human and Citizen Rights. Far from misunderstopping contractual freedom, they offer new possibilities for implementation.
It can be recalled that the minimum income of activity is intended to enable the social and professional reintegration of allegiants of the minimum income of insertion. According to Article L. 262-38 of the code of social action and of the families, as it is the result of Article 24 of the referred law, the contract insertion-revenue minimum of activity (CIRMA) is among the concrete actions - such as social assistance benefits, orientation to the public service of employment, activities or internships or other forms of assisted minimum employment -, likely to be Pursuant to Article L. 262-37 of the same code, in the drafting of Article 23 of the law, the content of the insertion contract is debated between the individual and a person specially responsible for the development of this contract; the law also recalls that the contract is freely entered into. Once signed, it must be respected, unless it is revised in accordance with Article L. 262-23. If it is true that the non-compliance by the individual contractor with its commitments may lead to a decision to suspend the payment of the allowance, such a decision may only be made in accordance with the procedure provided for in article L. 262-23; the competent authority is also not required to take it; It is naturally likely to be challenged in social welfare courts. The factual critique sketched by the last part of the argumentation of the referral must thus be viewed as missing in fact.
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For these reasons, the Government considers that criticisms by the authors of the appeal are not likely to justify the censorship of the law referred to. That is why it considers that the Constitutional Council should reject the appeal before it.
