Targeted since the end of July by a European procedure for excessive deficit, like six other EU member states, France was due to send its plan to get back on track by September 20, but Paris has asked the European Commission for a postponement.
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Faced with its budgetary slippage, France must be held accountable and propose a plan to get things back on track to Brussels. Since the end of July, the Francelike 5 other European countries, is targeted by a European procedure for excessive deficit. Estimated at 5.6% of GDP this year, the public deficit could even exceed 6% next year and Paris must therefore show the European institutions, normally before 20 September, how it will get back on track.
But the call for early legislative elections and the political paralysis that followed did not help the resigning government, although supposed to manage only current affairs, has prepared a draft finance law for 2025. Thus, while France has a Prime Minister but still no government since Thursday, it has requested such an extension for ” ensure consistency between the plan and the 2025 finance bill “, the ministry told the economic weekly, without specifying the length of the delay.
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The outgoing government has nevertheless prepared a 2025 budget for its successor. reversible ” which provides for State expenditure strictly equivalent to that of 2024, i.e. 492 billion euros, but distributed differently between ministries. This would in reality represent a saving of 10 billion euros taking into account inflation.
As it stands, this effort remains far from sufficient to pass below the famous 3% mark. To do this, approximately 110 billion in savings would be needed by 2027, estimated the General Directorate of the Treasury. It’s brutal “, declared the President of the Court of Auditors ” politically difficult to achieve ” And ” not socially acceptable “, Pierre Moscovici added.
It remains to be seen what adjustments will be made by the new government that has not yet been appointed. In any case, this is a priority issue for the new Prime Minister Michel Barnier, both to avoid the risk of financial sanctions from Brussels and to meet French deadlines. The draft budget must be submitted to Parliament on October 1st and voted on by December 31st at the latest.
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