The resigning Minister of Economy and Finance, Bruno Le Maire, judged on Monday that France could meet its objective of a public deficit of 5.1% of GDP in 2024 and 3% in 2027, while the budgetary trajectory is threatened with slippage.
“We can and must maintain our 5.1% deficit in 2024, and it is entirely within our reach,” Mr. Le Maire assured the Finance Committee of the National Assembly, despite “tax revenues (which) could be lower than expected” this year.
“We can and must maintain our 3% in 2027. It is only a question of political choices,” added the minister regarding this maximum threshold set by European budgetary rules.
Bruno Le Maire had announced 25 billion euros in savings by 2024, but only 10 billion were implemented before the early legislative elections, through credit cancellations.
After the public deficit dropped to 5.5% in 2023, a Treasury note communicated to parliamentarians at the beginning of September by the Ministry of Economy and Finance indicated a possible new slippage to 5.6% in 2024 without additional measures, attributing it to an unexpected surge in local authority spending and disappointing tax revenues.
The deficit could reach 6.2% in 2025 with unchanged policy, according to this document dated July and consulted by AFP. It also underlines that “a return of the deficit below 3% as early as 2027”, as planned in the multi-year trajectory of public finances transmitted by France to Brussels in the spring, “would suppose achieving savings of around 110 billion by 2027”.
“The situation of public finances (…) is the first challenge that the government of Michel Barnier,” appointed Prime Minister on Thursday, will have to face, said Bruno Le Maire. “It is the most urgent challenge. It is the most difficult challenge. It is the most political challenge. It is the challenge on which everything depends, because nothing is possible without well-managed public finances,” he insisted.
“This requires clear choices,” such as canceling “part” of the 16.5 billion euros of credits frozen as a precaution by the government, he recommended. However, “these choices are not mine,” said the minister, who is leaving after seven years at the head of Bercy.
mpa/ak/spi
Related News :