It will take more to convince. Economy Minister Bruno Le Maire said this morning that the first public spending review had identified at least 10 billion euros in savings. Among the avenues mentioned, the fight against the explosion of sick leave and the drift in drug spending, the abolition of the Pinel device in housing, the overhaul of the zero-rate loan or the abolition of tax advantages on fuels… This combing through have more results than previous initiatives?
The rating agency S & P will be attentive to this, it which, against all expectations, had maintained the rating of the tricolor debt at the beginning of June at AA, despite an outlook that had changed to negative at the end of 2022. France had felt the wind of the ball, narrowly avoiding degradation. “The Assises give more visibility to the government’s budget consolidation strategy with a view to the draft 2024 budget, which will be presented in the fall. In particular on the assumptions underlying the government’s objective of reducing the budget deficit by 4.7% of GDP in 2022 to 3.2% in 2026”, confides to L’Express Rémy Carasse, sovereign analyst at S & P Global Ratings.
However, the agency does not revise its judgment and continues to believe that the reduction in the public deficit will be slower than the Bercy scenario, to reach 3.8% of GDP in 2026. Past performance is not indicative of future performance, but the history clearly does not plead in favor of France. “The difference between the government’s budgetary targets and our forecast stems mainly from our expectation of more moderate economic growth, and a more gradual reduction in public expenditure relative to GDP, given France’s relatively weak record in terms of The government’s strategy to bring the budget deficit below 3% of GDP in 2027 is also based on improving the balance on local and regional government at 0.5% in 2027, a level that has never been reached before. The next release from S&P will be on December 1.
Marketing dimension
The exercise of these Assizes does not convince Patrice Duran, professor at the Ecole Normale Supérieure in Cachan, familiar with questions of evaluation of public policies. “This event is organized for political reasons, because, at European level, France is expected. As on the national level. There is a marketing dimension to show that we are going to do things”. Beyond the amounts involved, it is still necessary to cut budgets wisely. “Everyone agrees that this review of public spending must be done, but what happens next? In reality, the spending ministries and their administrations are not very cooperative and Bercy remains at their eyes an enemy, deplores Patrice Duran. Moreover, and we can regret it, efficiency has not been the decisive question in the evaluation of public policies in the past, we have preferred to focus on the implementation implementation and impact assessment by economists.” Moreover, “the Court of Auditors declared that the exercise had formerly had only a limited budgetary impact.”