© EMMANUEL DUNAND/AFP/Archives Michel Barnier, May 22, 2017 in Brussels .
With the Barnier government having taken the reins, this is an opportunity to recall one of the main subjects on which it will have to focus quickly: the budget. This is not new; the latest data published by INSEE reveal that French public debt reached 112% of GDP, or €3,228.4 billion at the end of the second quarter of 2024.
This record figure, up €68.9 billion between April and June, shows a persistent crisis, amplified by the economic measures taken to deal with inflation and the energy crisis.
As reported by Public Sénat, the State recorded a public deficit of 5.5% of GDP in 2023, a figure that could climb to more than 6% by the end of the year, according to the Minister of Public Accounts, Laurent Saint Martin. This slippage, which takes France very far from the 3% limit theoretically imposed by the European Union, is largely attributed to the management of the previous government. Overly optimistic, the latter is accused of having built a 2024 budget on erroneous growth forecasts. “It was inevitable. The previous government voted on a 2024 budget knowing full well that the indicators on growth forecasts were not the right ones. After the dissolution, they no longer had any legitimacy to act. “As for the new government, it has only just been put in place,” explains Senator Jean-François Husson (ex-LR), general rapporteur of the budget.
As the presentation of the 2025 finance bill approaches, scheduled for the week of October 7, the government is considering significant savings coupled with tax increases, particularly targeted at the wealthiest and large companies. This is an inevitable step, according to the chairman of the Senate Finance Committee Claude Raynal (PS): “The subject is now on the table. Those who claim that we can rectify the situation without touching taxation, the Darmanins, the Attals… are engaging in electioneering.”
Ultimately, the cost of borrowing French debt has now exceeded that of countries such as Spain or Portugal. Under excessive deficit procedure, France must present a recovery trajectory to Brussels by the end of October. The path will be tough in any case. So much so that experts are already doubting the credibility of commitments to return to a deficit of 3% of GDP by the end of the five-year term.
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