France's savings plan: holidays away and frozen frozen!

France's savings plan: holidays away and frozen frozen!

France faces the challenge of significantly reducing his public debt. Premier François Bayrou has therefore announced measures that could bring drastic cuts into public life. Among other things, the deletion of two holidays, a reduction in the number of state officials and the merging of authorities are planned. These reforms are part of a larger plan to optimize the public expenditure structure and to freeze the pension payments and social benefits in the coming year at the level of 2025. Another goal is to increase the defense budget by one billion euros, while efficiency increases in the health system are to be sought at the same time. The savings are expected to reach a total of 43.8 billion euros for the budget in 2026 in order to reduce the budget deficit from 5.4 percent this year to 4.6 percent in 2026 and to reach the European limit of three percent by 2029. This reports [OE24] (https://www.oe24.at/welt/franz-will-feiertage-reichen-und- expenditure-freiten/640984514).

Public debt burden in France is already alarming 114 percent of gross domestic product. Bayrou warns of a potential state crisis, similar to that in Greece, and emphasizes that the unclear conditions in parliament could endanger the implementation of these measures. The center-right government has no majority of its own, which increases the risk of a government crash in the event of a controversy over the household. So far, the left warehouse has not received sufficient support from the racial emile nationally (marginal) to successfully carry out a vote of no confidence.

urgency of budget reform

France's budget deficit is a central topic that has often not been addressed in the political debate of the past few months. After the early parliamentary elections in July, which did not produce a clear majority, President Emmanuel Macron has long deliberated about the appointment of a new prime minister. Interim Prime Minister Gabriel Attal has already sent the first budget plans to the ministries, while the newly elected Prime Minister Michel Barnier missed an important date to bring the household in 2025 into parliament. In his inaugural speech, Barnier warned of the risks because the deficit could be over six percent of the economic output this year, and the EU has opened an exceptional deficit procedure against France. These measures are necessary according to DW to present a strategy to reduce the deficit.

The country's debt amounts to around 3200 billion euros, which corresponds to 110 percent of the gross domestic product. Despite the challenges, Barnier hopes to reduce the deficit to five percent by 2024 and to three percent by 2029, mainly due to expenses and higher taxes for wealthy citizens and companies. Protests against the government and the announced expenses are already underway while the markets are unsettled.

measures to stabilize finance

The continued level of public debt makes France one of the highest indebted countries in the EU, immediately to Greece and Italy. Finance and Economic Minister Bruno Le Maire rejected tax increases and relies on spending cuts, while a first savings package of ten billion euros has already been put together. Additional savings of 20 billion euros are planned. The Court of Auditors specifically demands savings of 50 billion euros to comply with the EU deficit limit of three percent by 2027. Many citizens are concerned about the effects of austerity measures on socially weak groups, which could lead to social disputes promptly. Le Maire emphasizes the need for a social debate about government spending and priorities in the budget to ensure the long -term stability of finances. This results from the information from Tagesschau.