The government of Michel Barnier, just formed, detailed on Thursday October 10 its draft finance law and financing of Social Security for the year 2025, which must be debated in the National Assembly. The text carried by the Prime Minister and adopted by the Council of Ministers, confirms, in the name of budgetary rigor, his desire to save 60 billion euros from 2025 (40 billion euros in spending reductions and 20 billion in increases taxes). Drastic measures to be able to contain the public deficit, established at 6.1% of GDP in 2024, with the promise of returning to 5% of GDP in 2025, then to 3% by 2029.
The budgetary credits allocated to the various ministries should therefore reach 336.7 billion euros in 2025 compared to 340.1 billion in 2024. A clear drop. If the government defends itself from any austerity, many ministries and “missions” are losers (only 7 out of 33 have an increasing budget or equivalent). And many French people will see some of their bills and other taxes increase. L’Express draws up a non-exhaustive list of potential winners, but above all losers in the face of this finance bill, if it were adopted as is.
Armies and security spared by budget cuts
The Ministry of the Armed Forces is once again spared from the policy of efforts to reduce the public deficit, with a budget in compliance with the Military Programming Law (LPM). Like last year, the Armed Forces budget must increase by 3.3 billion euros and reach 50.5 billion euros excluding pensions, or 2% of GDP. From 32 billion euros in 2017 when Emmanuel Macron came to power, it should rise to 67.4 billion in 2030, thanks to two successive LPMs providing for an increase in defense credits, against a backdrop of war in Ukraine and the Middle East.
The 2025 draft budget also provides for an increase of nearly 600 million euros in credits dedicated to security, amounting overall to 25.2 billion in 2025 compared to 24.3 billion euros in 2024. The government by Michel Barnier is committed to preserving programming and orientation laws such as that of internal security (Lopmi).
More taxes for big businesses and the richest
Despite tensions over tax increases even in the presidential camp supposed to support him, Prime Minister Michel Barnier is aiming for a shared effort to preserve French credibility with the financial markets and the EU, which has singled out Paris for its excessive deficits .
If the State will be the largest contributor, to the tune of 20 billion euros, to curb public spending, local authorities are asked to provide 5 billion euros. Furthermore, tax increases will reach 19.3 billion euros according to Bercy, a turnaround after seven years of tax cuts. Some 65,000 of the wealthiest tax households (i.e. 0.3% of the total), earning more than 250,000 euros annually for a single person, will pay a surcharge for three years which will bring their minimum tax rate to 20%. and should bring in 2 billion. Around 400 companies with turnover exceeding one billion euros will pay more than the 25% corporate tax rate for two years. A measure expected to bring in 8 billion euros in 2025. Claiming to want to preserve “the most modest” and “those who work”, the government will increase the income tax brackets by 2% to compensate for inflation .
Farmers protected in the face of tax increases
Farmers are escaping tax increases, the Barnier government having taken over the commitments of the previous executive. To respond to agricultural anger last winter, marked by tractor blockages of sections of highways throughout France, Gabriel Attal’s government made a total of 70 commitments. To come into force, several of them, involving a drop in public revenue, had to be integrated into the finance bill (PLF) and the social security financing bill (PLFSS) for 2025.
Under Michel Barnier, the PLF 2025 includes several tax relief measures, representing a shortfall for the State of 394 million euros, according to elements communicated by the Ministry of Agriculture. The document thus confirms the abandonment by the executive of the increase in taxation on agricultural diesel (GNR), one of the triggers of the demonstrations. The shortfall represents 160 million euros. The text also includes measures aimed at reducing the taxation of certain active farmers: those who must mobilize their precautionary savings in the face of a hazard, or even dairy or beef cow breeders. This last measure, estimated at 150 million euros, is supposed to “encourage the increase in the French cattle herd”.
A blow to health spending and justice
According to the Social Security financing bill (PLFSS 2025) presented Thursday evening, the deficit in the health sector widened to 14.6 billion euros in 2024, while the government predicted a year ago a deficit limited to 8.5 billion. The draft budget thus plans to contain the 2025 deficit to 16 billion, thanks to significant efforts, particularly in the area of health. Among the savings measures adopted, the government wishes to reduce the share of Health Insurance in the reimbursement of medical consultations, with complementary health insurance companies simultaneously increasing their share, so that their policyholders continue to be reimbursed as before. The PLFSS also provides for reductions in drug prices, and “an effort on the relevance of medical prescriptions”, particularly in terms of medical transport of patients and medical analyses.
As for Justice, its budget will be 10.24 billion euros, almost 500 million euros less than planned. This amount is a very slight increase compared to the 2024 budget (+ 0.11 billion euros), but remains lower than the 10.68 billion euros which were planned for 2025 in the justice programming law, adopted in October 2023. This law, promoted by Mr. Dupond-Moretti, promises a Justice budget of nearly 11 billion euros in 2027, and the hiring in five years of 10,000 people, including 1,500 magistrates and 1 800 clerks. The fact remains that, in its projections, Bercy is counting more on the creation of 619 jobs next year, i.e. 270 for the judicial services and 349 for the prison administration.
National Education deprived of 4,000 positions, with a stable budget
The 2025 National Education budget, the State’s largest expenditure item, provides for 4,000 fewer teaching positions compared to 2024, mainly in nursery and elementary school, the ministry said on Thursday. Rue de Grenelle justifies this drop in teaching positions by “the drop in the number of students which should accelerate with 97,000 fewer students at the start of the 2025 school year”.
In the detail of fewer teaching positions, the first public level (nursery and elementary) is the most affected with a drop of 3,155 positions. Public secondary education (middle and high schools) lost 180 positions, private primary education 660 and finally private secondary education 40, according to the Ministry of Education. In addition, the National Education budget for 2025 amounts to 63 billion euros, generally stable compared to 2024.
Learning to diet and reduced engagement on MaPrimeRenov’
The system, strongly encouraged in recent years to support youth employment, should suffer a serious slowdown. The government decided in its 2025 budget to lower the hiring bonus for apprentices, causing employers to jump. “An effort is requested on (hiring) bonuses of 1.2 billion euros,” indicated the Ministry of Labor, specifying that the possibility of a single aid reduced from 6,000 to 4,500 euros was “one scenario among others”. Also, still with the aim of saving money, the exemptions from employee and employer contributions from which apprenticeship contracts benefit will only apply in 2025 up to half of the SMIC, and not up to 0.79 SMIC like today, which will increase the cost for employers of the best-paid apprentices.
In its finance bill, the new government also wishes to reduce its subsidies to finance MaPrimerénov’, the main public aid for the energy renovation of housing. It will amount to 2.3 billion euros in 2025, compared to 4 billion announced for 2024. This is a return to the budget granted in 2023, in a context where the number of renovated housing units had decreased by 7%. that year, according to the National Housing Agency.