Revaluation of pensions postponed, civil servant positions eliminated, exemptions from social security contributions for companies reduced… The executive detailed this Thursday evening how it intends to find “ 60 billion euros » in the finance bills (PLF) and social security financing bills (PLFSS) to redress adrift public finances. Despite an outcry from within itself over the planned savings and tax increases and against a backdrop of tensions in the LR-Macronie alliance, it is aiming for a shared effort to ward off the threat of a “ financial crisis » and preserve French credibility with the financial markets and the EU which has singled out Paris for its public deficits.
A tax increase for the wealthiest
The government plans to establish for three years a “ temporary and exceptional contribution » targeting the wealthiest households which would bring in 2 billion euros in 2025, in its draft budget for 2025 focused on the recovery of public finances. This mechanism would guarantee the taxation of these households at a minimum average rate of 20%, according to the government. It concerns those who are already subject to the exceptional contribution on high incomes (i.e. a reference income of 250,000 euros for a single person and 500,000 euros for a couple).
It is also planned to revalue the brackets of the income tax scale by 2% in 2025 in order to “ protect the purchasing power of the French », which will represent a shortfall of 3.7 billion euros for the State. This measure “ helps prevent nearly 530,000 households from being subject to income tax. It protects the French from an increase in taxation linked to inflation », indicates this text.
Thousands fewer teaching and civil servant positions
The 2025 National Education budget, the state’s largest expenditure item, provides for 4,000 fewer teaching positions compared to 2024, mainly in nursery and elementary school, the ministry said on Thursday. Rue de Grenelle justifies this drop in teaching positions by “ the decline in the number of students which is expected to accelerate with 97,000 fewer students at the start of the 2025 school year ».
The elimination of 2,201 civil servant jobs for the State and its operators next year is on the program. For State services alone, 1,196 positions would be eliminated: this balance between reductions and creations includes in particular 2,000 reductions in the National Education and 505 in the Budget and Public Accounts, while at the same time 619 jobs would be created in Justice or 630 in the Army.
The government finally plans to reduce apprenticeship aid, put in place to support youth employment, by 1.2 billion euros in 2025.
A contribution from businesses
A “ exceptional contribution » will be asked of around 400 large companies on their profits made in France in 2024 and 2025 in order to participate in the recovery of public finances. This measure, which concerns companies with a turnover of at least 1 billion euros, must bring in 8 billion euros in 2025 and 4 billion in 2026. An exceptional tax will be requested from large maritime freight companies, which must bring in 500 million euros next year.
The electricity price
A reduction limited to 9% in the regulated electricity price will occur on 1is February, under the effect of the increase in a tax which should represent 3 billion euros in revenue for the State.
Less health spending
The government is targeting a Social Security deficit of 16 billion euros in 2025, after 18 billion euros in 2024. This objective requires Health Insurance to make around 4 billion euros in savings compared to the natural evolution of its expenses. Among the savings to be made, the government plans that Health Insurance will reimburse less for medical consultations, and supplementary health insurance will do so more.
The government is also planning a reduction in the ceiling for compensation paid in the event of sick leave. Health Insurance will continue to pay compensation of 50% of the daily salary, but with a ceiling of 1.4 SMIC, compared to 1.8 today. As for the revaluation of pensions planned for 1is January, it will be delayed by six months.
A penalty on polluting cars
The new penalty on the purchase of new polluting cars will affect almost all gasoline and diesel vehicles from 1is January 2025. The bonus envelope for the purchase of electric cars increases from 1.5 to 1 billion euros and will finance “ priority given to the poorest households ».
Doubts for the High Council of Public Finances
These forecasts are “ fragile », Judged the High Council of Public Finances (HCFP) in an opinion delivered Thursday. “ The forecasts remain a little optimistic and the information is poorly documented, and as a result the results on revenues and expenditures are fragile. », affirmed its president Pierre Moscovici during a press conference.
