With a debt of 3,100 billion and a larger deficit than expected last year (5.5% of gross domestic product), can France increase its spending? Here is a three-point answer.
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1 – Expenses
Are the programs of the three main blocs credible, given France’s financial situation (3.1 trillion euros of debt)? We can ask ourselves the question, in view of the fireworks of billions, which will be set off this summer.
Let’s start with the New Popular Front (NFP) which plans, via an amended budget, to immediately increase spending by 25 billion: “10% increase in the index point for civil servants and APL (personalized housing assistance), repeal of the pension reform, etc. »
The National Rally also intends to vote on an amending budget this summer, in order to reduce VAT on energy. This represents a cost of “seven billion this year”, said Jordan Bardella, the president of the RN. And 14 billion next year!
The presidential camp is not left out. In the 2025 budget voted in the fall, it provides for an exemption from notary fees for first-time buyers for a cost of ” three billion “ (according to the Montaigne Institute). Or even a reduction in inheritance taxes (around three billion).
2 – Recipes
While it is easy to spend, it is more difficult to put revenue in front of it. On the NFP side, this year we are counting on “30 billion in new tax revenues: tax on superprofits, wealth tax with a climate component. » But can these measures be implemented in such a short time? “These are complex reforms, confirms Mathieu Plane, economist at the OFCE, a Sciences Po research center. Moreover, the NFP assumes a significant fiscal shock. The risk is capital flight. »
On the RN side, the funding avenues seem quite random. “The RN wants to reduce France’s contribution to the European Union, continues the economist. But it is illusory to think that France can decide unilaterally. » Indeed, the way the European Union operates on budgetary issues makes a rapid agreement with member states and the European Parliament unlikely.
“As for national preference and the savings that the RN expects from it, it raises constitutional and legitimacy questions, which go well beyond the economic field”estimates Mathieu Plane.
Finally, regarding the presidential camp, it is not clear how it intends to finance its new expenses, especially after the confusion at the start of the year over the scale of the deficit. “This calls into question the credibility of the promises on the restoration of public accounts. »
3 – The risk of increasing deficits
To summarize, the three main blocs want to restore more or less massive purchasing power to the French. This is called “demand-led recovery”. The goal is to boost consumption, growth, and therefore tax revenues. “But will we have the industrial capacity to meet this demand? », questions Mathieu Plane. Knowing that 80% of manufactured products consumed in France are imported.
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In short, the risk is to widen our trade deficit. And to encourage purchases of Chinese solar panels and electric vehicles. “The questions of reindustrialization and ecological transition are unfortunately very absent from the debates. »
