“We are up against the wall.” If the tone of Pierre Moscovici, first president of the Court of Auditors, is serious, he is pleased to have “participated in raising awareness among the French in the debt situation”. Like the Bayrou government, the former Minister of the Economy wants the public deficit to be restored to between 5 and 5.5% next year and to “stay the course” to reach below 3% in 2029. For this, “the essential savings must be obtained as a priority through lasting reforms, targeting ineffective and inefficient spending, in preference to sluggish measures,” he argues. This is the whole purpose of the report presented this Thursday, January 9.
The Court of Auditors wants to fuel the preparation and discussion of the budget for 2025. It formulates twelve savings proposals among the exceptional aid measures undertaken to deal with covid-19 or the war in Ukraine still in place. Objective: put an end to “whatever it takes”. Five areas are concerned: learning, energy prices and inflation, the ecological transition of the agricultural and forestry sectors, the greening of vehicles and culture.
Reduce learning aid
For several years, the number of young people in apprenticeships has exploded. But for the wise people of rue Cambon, it is not necessarily a success. It costs the State dearly, around 14 billion euros since 2019, and it mainly benefits higher education students. They are calling for a downward revision and better targeting of the learning support system. Namely focusing on apprentices up to baccalaureate level and excluding companies with more than 250 employees. This proposal differs from the announcement by the former Barnier government at the end of September 2024. It wanted to reduce hiring aid differentiated according to the size of the company, but while retaining the current eligibility criteria. Savings expected at 750 million euros in 2025 and nearly 2.9 billion in 2027.
The Court also wishes to add a capping level for the payment of higher education diplomas to the average cost observed for licenses and masters. But also remove partial exemptions from apprenticeship tax in the departments of Bas-Rhin, Haut-Rhin and Moselle.
Another area of savings for rue Cambon: exceptional measures to combat rising energy prices and inflation. “The massive aid mobilized in response to the rise in energy prices and inflation has not declined at the same rate as the latter, and should still have a net impact on the public deficit of 5.4 billion dinars. “euros in 2024”, indicates Pierre Moscovici. “Two tax measures to support household purchasing power could now be brought back to their pre-crisis level,” he continues. Namely the increase in the mileage scale associated with income tax and the increase in the ceiling of the tax credit for childcare. Expected savings: 730 million euros for the two measures from next year.
Ecological planning and greening support
Support for ecological planning in the agricultural and forestry sectors is also in the sights of the Court of Auditors. “In the last two finance laws, these sectors saw their credits significantly increased compared to pre-crisis levels, in particular to respond to ecological challenges,” explains the first president of rue Cambon. Several measures explode the ceilings of the 2023 – 2027 public finance programming law, or duplicate the measures of the new CAP (common agricultural policy). Like hedge plans, the HVE tax credit or forest renewal. 540 million euros in savings are expected.
-The report also points to aid for greening vehicles. “The recovery plan and support for the automobile sector, then the rise in fuel prices caused by Russian aggression in Ukraine, led the government to increase support for this system,” said Pierre Moscovici. And to continue: “If supporting the ecological transition of vehicles remains relevant, the current regime is not fully coherent by still favoring cars that are too heavy and delaying the renewal of fleets in the construction sector.” The former vice-president of the European Parliament proposes lowering the eligibility ceiling for vehicles for the ecological bonus to 1,925 kg, compared to 2,400 kg today. This would enable savings of 200 million euros.
The Court of Auditors also wants to remove the tax reduction for non-road diesel in the construction sector. It benefits from an excise of €18.82/MWh instead of the normal rate of €59.40/MWh. The cost of this system reaches 1.24 billion euros in 2023 and 1.05 billion in 2024. “The gradual elimination of this measure, announced since the end of 2018, has been postponed several times, due to the economic consequences of the pandemic, then the rise in energy prices,” notes the report. It recommends bringing the excise on non-road diesel applicable to the construction sector to the level of common law from January 1, 2028, by adjusting the milestones in 2025, 2026 and 2027. 705 million euros in savings are expected.
Removal of “unconvincing” measures from the cultural sector
Finally, the wise people wish to remove several “unconvincing” measures in the cultural environment. Support was provided to this sector during the health crisis with more than 5 billion euros mobilized. Several recovery measures were then extended as part of the acceleration strategy included in the fourth investment program for the future (PIA 4) at the end of 2020, then in the France 2030 plan. “It is a question of preventing new expenditure by removing uncommitted appropriations from two systems whose limits and weaknesses have already been pointed out by the Court in previous work,” specifies the report.
The first mechanism targeted is the “ICC/Tech and Touch” fund. Led by Bpifrance, it was created at the end of 2019 to invest in structures dedicated to the development of companies whose activity is carried out in the cultural and creative industries. Eliminating this fund could avoid 90 million euros in new spending.
The second system is the “call for expressions of interest in Culture, Digital Heritage”. Managed by the Caisse des Dépôts et Consignations Banque des Territories, it was launched in 2017 and saw its investments accelerate in 2020. But at the end of 2023, only 36 billion euros had been committed for the benefit of 14 beneficiaries, leaving 104 billion available to the Caisse des Dépôts et Consignations. “The investments made present a very mixed result,” details the report. Before continuing: “They have benefited companies whose innovative dimension is not proven and several of which suffer from an absence of a viable economic model”.
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