The government indicated on Monday that it had identified “at least 10 billion euros in savings” which are only a “step” and will contribute by 2027 to the recovery of France’s degraded accounts, by cutting health expenditure or fuel tax benefits.

These proposals for savings, which will be the subject of consultations, will partly feed the draft budget for 2024 which will be presented in September and will require at least 12 billion euros in savings for this year alone, said a source to Bercy.

After recently escaping agency sanction S

“Now that we are back to normal, who would understand that we continue to spend so much?” Asked the Minister of the Economy Bruno Le Maire as he opened the Public Finance Conference at Bercy.

These meetings follow the annual reviews of public expenditure launched a few months ago.

They were however shunned by the three main associations of local elected officials, the Association of Mayors of France (AMF) deploring the absence of “strategy” and “vision” for the communities while saying it was open to “consultation “.

To reduce public debt and deficit until 2027, “we have identified, in particular with our first public spending review, at least 10 billion euros in savings”, underlined Bruno Le Maire.

These savings will have to be found on health, by fighting against the explosion of sick leave and “the excesses” of drug spending, he detailed.

Also in the sights are housing aid, reduced by two billion euros per year, and employment support in this period of low unemployment, more particularly apprenticeships and the personal training account.

Another target, the tax advantages on fuels which benefit in particular road hauliers or farmers, while France is embarking on the shift to energy transition. They will be phased out by 2030, with support for the professions concerned.

According to the agricultural union FNSEA, “this fiscal measure taken for a budgetary objective is in no way an appropriate response to the challenges of the transition from agricultural fuels to the exit from fossil fuels”. The majority union pleads in a press release for the cost of decarbonization to be “neutral” for farmers and calls for “real compensation on each of the French farms”.

Asked about the need to find more savings for the 2024 budget, a source at Bercy indicated that “there would be others” which would “probably total more” than 12 billion euros, citing an assessment of the Court of Auditors.

The Assises are only a “stage”, she added, while Bruno Le Maire assured that he did not want to do “austerity” and rejects any tax increase.

The objective is to reduce France’s heavy debt to 108.3% of GDP (gross domestic product) in 2027 (compared to 111.6% at the end of 2022), which places it on the side of the poor European students, and to bring it under the European target of 3% the public deficit (4.7% at the end of 2022).

To achieve this, the government is also counting on the end of the energy shield, the gains from reforms such as pensions or unemployment insurance, and full employment against a background of growth that it foresees in the long term more dynamic.

These efforts are deemed all the more necessary as the economic environment is getting tougher, with the re-establishment of European budgetary rules next year and the sharp rise in interest rates which is significantly increasing the debt burden.

The government could also, when presenting its next budget, revise its growth forecast for 2023, currently 1%.

Already, the executive has multiplied the announcements in recent weeks. It thus froze an additional 1% of the credits of the 2023 budget (1.8 billion euros) which will be partially cancelled, according to Bruno Le Maire, and asked the ministries to generate 5% savings, excluding salaries, in 2024, in particular for finance the energy transition.

“Some are asking for more ambitious objectives; but the first development would already be to keep those displayed”, warned the government of the Banque de France François Villeroy de Galhau, demanding firmness in their deployment.

But between refusal to increase taxation and social tension in the face of high inflation, controlling spending promises to be tricky. Especially after a painful pension reform and without an absolute majority in the National Assembly.

06/19/2023 18:39:43 –         Paris (AFP) –         © 2023 AFP