“France requested such an extension” to “ensure coherence between the plan and the 2025 financing bill,” the Economy Ministry told the weekly, without specifying the length of the deadline. Asked by AFP, Bercy confirmed the information.
Excessive deficit
Targeted since the end of July by a European excessive deficit procedure, like six other EU member states, France must send to Brussels by September 20 its plan to reduce the public deficit until 2027, by which date it must be normally fell below the 3% authorized level. According to the European texts, the deadline is valid “unless the Member State and the Commission agree to extend this deadline for a reasonable period”.
Countries are required to take corrective measures to comply with European budgetary rules in the future under penalty of financial sanctions. However, in France, the unexpected increase in EU spending, together with disappointing tax revenues, could push the public deficit to 5.6% of GDP this year, or even 6.2% in 2025, from 5.5% in 2023. week of Bercy to parliamentarians.
The resigned government has prepared for its successor a “reversible” budget for 2025 that foresees expenditures for the State strictly equivalent to those in 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 early legislative elections.
“A return to the deficit below 3% from 2027,” as planned in the multi-year public finance trajectory France sent to Brussels in the spring, “would require savings of around 110 billion by 2027,” the general warned. Treasury Department in a July note.