France plans 60 bln euro budget squeeze for next year
60 billion euro belt-tightening drive next year to hit new fiscal targets, officials said on Wednesday, outlining an unprecedented push to rein in France's spiralling deficit.
Prime Minister Michel Barnier told lawmakers on Tuesday he would reduce the budget deficit — which is set to reach 6.1% of GDP this year — to 5% by the end of 2025 but would have to push back the target date for reaching the euro zone's common 3% deficit goal to 2029 from 2027.
Three government officials involved in preparing the 2025 budget said the 60 billion euro ($66 billion) squeeze — equivalent to roughly 2% of GDP — was needed to correct the deficit from where it would otherwise have been if nothing had been done.
«The only way to get there is if everybody contributes to this effort (to cut) spending, every public body, services need to be reorganised within the government, municipalities and social services,» Finance Minister Antoine Armand told RTL radio.
Tax revenues have fallen short of expectations this year while the government has struggled to contain spending, leaving Barnier with the huge task of drafting a 2025 budget that narrows the hole but can also get through France's unruly hung parliament.
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