The French government will unveil this Thursday, October 10, during a Council of Ministers from 6 p.m., its draft budget for 2025. To restore adrift public finances, the objective is to find 60 billion euros in the draft finance law (PLF) and social security financing law (PLFSS), in order to prevent the deficit from exceeding 6% of GDP (gross domestic product). In June, France saw its debt swell to 112% of GDP, the highest level of debt in the European Union ahead of Greece and Italy. Its ten-year borrowing rate exceeded that of Spain on the debt market at the end of September, a first in almost 18 years.
Information to remember
⇒ Michel Barnier will unveil his draft 2025 budget at 6 p.m.
⇒ The executive plans to find 60 billion euros to reduce the deficit
⇒ The left denounces an “austerity plan” which will “make the French suffer”
11:35 a.m.
Defense not affected by austerity measures
Defense will not be affected by the austerity plan that the Prime Minister will present this evening, assured Minister of the Armed Forces Sébastien Lecornu. “Michel Barnier announced that the Military Programming Law would be applied”, with an increasing budget set for 2025 at 50.5 billion euros, the minister declared on public radio France Inter. The budget of the Ministry of the Armed Forces, which was 32 billion euros in 2017, when Emmanuel Macron came to power, should increase to 69 billion in 2030, thanks to two successive military programming laws providing for an increase defense credits, against the backdrop of the war in Ukraine.
“There is nothing in excess. But in fact, the ministry must be exemplary,” said Sébastien Lecornu, for whom “the political and social acceptability of this increase in military credits” is to “maintain healthy pressure” so that the money is “well spent”. “This means that the ministry must be careful not to generate duplicates, to look closely at the margin structures of manufacturers,” he warned.
11:30 a.m.
The left denounces an “austerity plan” which will “make the French suffer”
The rebellious MP Manuel Bompard denounced this morning the 2025 budget project which is to be presented in the evening by Michel Barnier, seeing it as “the most violent austerity plan the country has ever known” and “which will” make the French suffer.” “Sixty billion euros in savings, that’s 2% of GDP,” noted the coordinator of La France insoumise on LCI. “I think that it will produce an economic recession and that this will not “It’s really not the right way to tackle the problem of increasing public deficits,” he said.
“It will affect people’s everyday lives, for example reimbursements for sick leave and a very sharp increase in mutual insurance prices, a reduction in retirement pensions, and also a collapse in the budgets of local authorities,” added the new LFI president of the Economic Affairs Committee, Aurélie Trouvé, on France Inter. “It’s the people who come to collect your waste, it’s the ladies in the canteen, it’s the primary school buildings, it’s all that will be affected by this collapse in spending,” he said. she criticized, convinced that “we can do otherwise”.
Like them, socialist senator Patrick Kanner denounced the “temporary” nature of tax increases on large businesses and the ultra-rich. “We cannot ask for 20 billion (euros) temporarily and then next year, everything will be fine. That’s not true, everything won’t be fine next year,” he said. he observed on franceinfo.
On Wednesday afternoon, the left presented ten “flagship measures”, intended to increase State and Social Security revenues by 49 billion euros. Among them, the reestablishment of the wealth tax with a climate component, a “tax on golden inheritances”, or even the end of employer exemptions for salaries above two minimum wage.
11:20 a.m.
Government in a minefield
The presentation of the budget this Thursday appears to be a high-risk exercise as the effort planned to reduce the dizzying French deficit is massive and the fragmented National Assembly is hostile to the government. To ward off the threat of a “financial crisis” and preserve French credibility with the financial markets and the EU, the executive is considering a shared effort, between spending reductions on the one hand (for 40 billion euros) and tax increases elsewhere.
This presentation, with an unprecedented delay of nine days, will be the starting point of a legislative journey strewn with pitfalls which should normally end no later than December 22.