Since the defeat of the presidential majority in the legislative elections in July, French Tech has had a hangover. And this did not improve with the appointment, in September, of Michel Barnier to the post of Prime Minister. A month later, the presentation of the finance bill for 2025 was greeted as a massive blow by the members of French Tech. And for good reason: several measures were in the crosshairs of the Barnier government, with the announcement of the reduction or even the elimination of innovation aid widely used by French tech start-ups.
As soon as the draft budget was tabled by Michel Barnier, the Macronist deputy Paul Midy (member of the Ensemble pour la République parliamentary group chaired by Gabriel Attal), a former entrepreneur, stepped up to the plate to counter the government’s intentions and make it change course. notice. As the coming week promises to be decisive (read below), we interviewed Paul Midy.
gull“French Tech embodies, today, a significant part of the French economy. It represents between 5 to 10% of our economy and our employment. It has become a sector in its own right.”
Why is it so important to defend French Tech? Is this really the priority of the moment when Michel Barnier’s government is facing a very deteriorated budgetary situation?
Start-ups, but also innovative VSEs and SMEs, are at the heart of major political priorities for us, but also for many political forces represented in the National Assembly. This is, first of all, the objective of full employment. Start-ups, VSEs and SMEs constitute the primary engine of job creation in France and reindustrialization. Today, 50% of the net creation of factories is the work of our industrial start-ups. The ecological transition, then, will not happen without the start-up ecosystem. Finally, there is the whole issue of technological sovereignty. What is the best way to regain sovereignty than to invent the technologies of the future on our territory? So, for our political group, this is an extremely strong conviction. And this has also been the case, from the start, for Emmanuel Macron. French Tech embodies, today, an important part of the French economy. It represents between 5 to 10% of our economy and our employment. It has become a sector in its own right.
Has not everyone, within the National Assembly and the government, realized this yet?
Exactly. Following the last parliamentary elections, populist forces on the far left and far right have gained ground. And these forces do not understand or are not interested in the subjects of innovation and support for innovative start-ups, VSEs and SMEs. These topics are put very low on their agenda. On the contrary, we have put it very high on the agenda. We have demonstrated this over the past seven years, both by keeping all the mechanisms that work (research tax credit, young innovative businesses, innovation tax credit) and by developing others. France 2030, for example, involves 54 billion euros of investment in innovation and deeptech in favor of the ecological transition.
gull“We must re-explain that these measures are not there to please a few and build a ‘Start-up nation’. No, the measures are there to meet political objectives which, I hope, are also shared by a large number of public officials.”
How do you explain that the Barnier government, appointed by Emmanuel Macron, arrives with a proposed budget consisting of removing the plug from these various measures favorable to innovative technological start-ups?
We are working to convince all the political forces in the Republican arc of the importance of these measures. I often tell the ecosystem that, since the dissolution of the National Assembly, what was a political achievement for seven years is no longer an achievement, and this, because we are in a form of coalition, that we calls the “common base”, with certain political forces which have other priorities. Today, we must re-demonstrate, re-explain, that these systems are not there to please a few and build a “Start-up nation”. No, the measures are there to meet political objectives which, I hope, are also shared by a large number of public officials.
What worries you most in the Barnier government’s draft budget?
There are truly catastrophic measures in this draft budget. For start-ups, VSEs and innovative SMEs, the elimination of the “Young Innovative Enterprises” (JEI) program would represent an increase in labor costs of 30% overnight! For companies which, most often, have little cash flow and are not yet making profits, this is untenable! If this measure were to be applied, hundreds of start-ups would be wiped out and thousands of jobs would be destroyed. Another catastrophic proposal is the elimination of the “Innovation Tax Credit” (CII), which supports young innovative SMEs or older SMEs which want to relaunch themselves in an innovation dynamic. These two measures are totally harmful and this is what I have been fighting against with my entire group for over a month. Fortunately, even if the battle is by no means won, we have managed to move the government forward in its thinking. I think he has now understood that removing these devices would be a very bad idea. On the other hand, he has not yet ruled out the idea of planing them. What we want is the full maintenance of the JEI and CII systems.
Isn’t this a desire to immunize French Tech from any contribution to the overall budgetary effort?
No not at all. We must, of course, control public finances and each public policy must be optimized. I have also tabled two amendments, voted by a very large majority in the National Assembly, to limit tax loopholes in terms of innovation. This makes it possible to finance 100% the maintenance of systems such as the JEI or the CII. On the other hand, we must be clear: if our objective is to continue to innovate, to regain control of our destiny and to do so in the reality of today’s world, it is imperative to accelerate and not decelerate. Rather than spending two months of budgetary procedures thinking about how we could scale back systems that are working, I would have preferred that we discuss how we can create room for maneuver to accelerate and become, for example, leaders in the artificial intelligence. Wanting to do it without start-ups, VSEs and innovative technological SMEs is a serious error. For the moment, I have no guarantee that these arrangements will be maintained, even if the government has started to show signs of understanding.
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Some voices, even within the start-up ecosystem, say that French Tech had been the spoiled child of President Macron, that there was too much public money injected into the ecosystem by successive governments. and the BPI, etc.
The term spoiled is an improper term. There are indeed a lot of public financial resources that have been invested in the innovation ecosystem. But not for nothing, not for fun, not for nothing. This money has already shown its usefulness. 10 years ago, France had almost no innovation ecosystem. Now we have the first innovation ecosystem in continental Europe. This ecosystem has created hundreds of thousands of jobs in France. Just for the creation of jobs, the public money that has been invested is profitable. But, in addition to having created jobs, we have companies which offer extremely useful services and which give us back sovereignty. I am thinking of Mistral in terms of artificial intelligence, but also of Quandela or Pasqal who sold the largest quantum computer in the world. It will perhaps be the IBM or the Apple of tomorrow. So it’s not a question of spoiled or not spoiled. Either we think that the political objectives that I mentioned at the start of the interview are important and we must give ourselves the means; or we think that they are not and then, indeed, we cannot agree with these investments.
Doesn’t it disappoint you that it is a government, appointed by Emmanuel Macron, which is affecting support measures for French Tech?
On this subject, I can assure you that the convictions of the President of the Republic have not changed. This remains very high on its national and European agenda. There is, on his part, no change of priority.
Decisive week at the National Assembly
The Senate reached the end of its examination of the draft budget for 2025 on Saturday. After a week of debates on pensions, reductions in employer contributions and even working hours, the High Assembly, dominated by an alliance of the right and the center which supports the government of Michel Barnier, generally approved the proposals of the executive, unlike the National Assembly which had largely reshaped this budget at the initiative of the oppositions, without being able to vote within the allotted time.
“We have taken unpopular measures, but faced with the growing deficit, we must face reality and reduce this lifestyle, even if it is difficult”reacted the centrist general rapporteur to the Senate, Elisabeth Doineau, to AFP. A solemn vote on the entire text is planned for Tuesday in the Senate, without suspense on its adoption.
The fate of the draft budget will then be in the hands of 14 parliamentarians – seven senators, seven deputies – responsible for finding a compromise text during a joint committee (CMP) on Wednesday in the Senate. The government camp will be in the majority, but nothing ensures that the “common base” will be agreed, because a key measure on the reduction of exemptions from employer contributions angers the Macronist troops.
If a compromise is found, the final text will be submitted for a final vote in both chambers, with the more than likely use of article 49.3 by the government before the deputies. A motion of censure is already promised by the left, with a risk for the Barnier government of being overthrown before winter if the National Rally decides to vote for it.
