The French government has asked the European Commission for an extension of the deadline for sending its plan to reduce the public deficit, the Ministry of Finance said on Saturday 7 September, confirming information from the Sunday TribuneIt was originally due to be transmitted by September 20.
“France has requested such an extension” to “ensure consistency between the plan and the 2025 finance bill,” the Ministry of Economy told the weekly, without specifying the length of the deadline. Asked by AFP, Bercy confirmed the information.
Targeted since the end of July by a European procedure for excessive deficit, like six other EU member states, France must send its plan to reduce its public deficit to Brussels by September 20, by which date it should normally have returned below the authorized 3%. According to European texts, the deadline applies “unless the Member State and the Commission agree to extend this deadline for a reasonable period.”
“Obsolete” trajectory
Countries are required to take corrective measures to comply with European budgetary rules in the future, under penalty of financial sanctions. However, in France, the unexpected surge in local authority spending, coupled with disappointing tax revenues, could push the public deficit to 5.6% of GDP this year, or even 6.2% in 2025, compared to 5.5% in 2023, according to budget documents sent this week by Bercy to parliamentarians.
The outgoing government has prepared a “reversible” 2025 budget for its successor, which provides for state expenditures strictly equivalent to those of 2024 (492 billion euros), but distributed differently between ministries. The Minister of Finance, Bruno Le Maire, had announced 25 billion euros in savings this year, but only 10 billion were realized before the early legislative elections.
“A return of the deficit below 3% by 2027”, as planned in the multi-year trajectory of public finances transmitted by France to Brussels in the spring, “would require achieving savings of around 110 billion by 2027”, warned the General Directorate of the Treasury in a note dated July consulted by AFP.
The President of the Court of Auditors, Pierre Moscovici, also considered this trajectory “outdated”, “having become unlikely and not necessarily desirable”. “To achieve this, we would have to make a hundred billion euros of savings in three years”, he declared in an interview with Parisian, published on Saturday. “It is brutal, it is politically difficult to do, socially unacceptable and economically hardly coherent,” he said.