The new budget presented should mark an “inflection” compared to the previous one while accelerating the reduction in public spending, believes the president of the Court of Auditors.
“We must reassure the country’s capacity to be governed.” Invited to the microphone of France Inter, the president of the Court of Auditors, Pierre Moscovici, called on Tuesday to adopt a different strategy regarding the formation of a new government. And this, in order to avoid further censorship, which would hamper France's credibility with investors.
“We must not rush too much. We need a situation which is different from that of Michel Barnier which was too fragile, he explained. We must try to find something more solid.”
However, the former Minister of Finance explained that too long a latency period would also be harmful to the country's economic situation. “Balances cannot be sacrificed in the process,” he recalled. “Debt is the enemy of the economy and public action.” Without a government and therefore without a budget, France will not be able to initiate the reforms that the former socialist deems necessary to reduce public finances, in a situation of “extreme seriousness”.
Savings that are difficult to achieve
“We no longer have any room for maneuver in this matter,” judged Pierre Moscovici. “We have creditors who are looking closely at our situation.” The president of the Court of Auditors believes that Michel Barnier had the merit of “setting a course”, by presenting a budget which planned to reduce the public deficit to 5% in 2025. All with 40 billion euros in savings and 20 billion in tax increases.
However, Pierre Moscovici stressed that the next government would not be able to take over the budget as designed by the Barnier team, the latter having been responsible for its fall.
“I am realistic,” he declared. “The savings requested from local authorities and social security will be difficult to implement.”
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“Inflexion”
The former minister, however, believes that there is room for maneuver to reduce public finances which weigh “57% of GDP, a record in Europe”. He took the opportunity to distill some ideas. “Is it essential that learning policies be accessible to all higher education students?” asked Pierre Moscovici while the cost of the system is estimated between 22 and 25 billion euros per year, according to the economist of the OFCE Bruno Coquet. The President of the Court also highlighted the recovery spending put in place during the Covid and energy crises.
However, “a strong France is not a France that engages in austerity,” he finally conceded after calling for a reduction in spending.
According to him, it is also necessary to increase, at “at least in the short term”, taxation, in the need for “tax justice”.
If the former minister considers it necessary that the new “budget marks an inflection”, the positions stated partly repeat the reading of the previous one.
