The French government has asked the European Commission for an extension of the deadline for submitting its public deficit reduction plan, which was initially due on September 20, the Ministry of Finance said on Saturday, September 7, confirming reports from Sunday’s Tribune.
“France requested an extension” For “Ensure consistency between the plan and the draft finance law for 2025”The Ministry of the Economy told the weekly, without specifying the duration of the delay. Bercy confirmed the information when asked by Agence France-Presse (AFP).
Beset since the end of July by a European excessive deficit procedure, like six other Member States of the European Union (EU), France must send to Brussels before September 20 its plan to reduce the public deficit until 2027, date by which it should normally be below the authorized 3% of the gross domestic product (GDP). According to the European texts, the deadline is “unless the Member State and the Commission agree to extend this period for a reasonable period”.
Countries must take corrective measures to comply with European budgetary rules in the future, under penalty of financial penalties. However, in France, the unexpected increase in community spending, coupled with disappointing tax revenues, could push the public deficit to 5.6% of GDP this year, or even 6.2% in 2025, compared with 5.5% in 2023, according to budget documents sent this week by Bercy to parliamentarians.
A “reversible” budget for 2025
The outgoing government has prepared a budget for 2025 for its successor “reversible” which provides for State expenditure strictly equivalent to that of 2024 (492 billion euros), but distributed differently among the ministries.
Finance Minister Bruno le Maire had announced savings of 25 billion euros this year, but only 10 billion were made before the early parliamentary elections.
“A return to the deficit below 3% by 2027”as planned in the multiannual public finances trajectory transmitted by France to Brussels in the spring, “This would mean achieving savings of around 110 billion by 2027”warned the general directorate of the Treasury in a note dated July and consulted by AFP.
The president of the Court of Auditors, Pierre Moscovici, also appreciated this trajectory. “elapsed”, “become improbable and not necessarily desirable”. “To achieve this we would need to save around 100 billion euros in three years”He said in an interview with Parisian published on Saturday. “It is brutal, difficult to do politically, hardly socially acceptable and hardly economically coherent”estimated.
