French budget deficit falls by a quarter

France's state budget deficit fell by a quarter in October on a 12-month basis, to €99.4 billion from €133.1 billion a year earlier, the budget ministry said on Friday.

The central budget is one component of the EU measure of the public budget comprising also welfare and local authority budgets.

The French government has sought to reassure investors and maintain its triple-A rating with a series of austerity measures, including the announcement last month of 65 billion euros in savings by 2016, on top of a €12-billion deficit-cutting package announced in August.

The government has said it needs to make 100 billion euros in savings to balance the budget by 2016.

On the central government budget, expenditures were at 310.8 billion euros against 354.3 billion on October 31, 2010.

Excluding debt charges, expenditure progression was “largely in conformity” with the government’s fiscal plans, the ministry said.

General budget revenues were at 229.1 billion euros against 223.6 billion at the end of October 2010.

Corporate tax revenues were up 22.8 percent, income tax revenues up 4.8 percent and value-added tax revenues up 5.1 percent.

Other fiscal receipts were down however, at €19.1 billion from €25 billion in October 2010.

In November, the budget ministry said the state budget deficit should be €95.3 billionin 2011 €200 million less than previously expected thanks to spending cuts.

The ministry says 2011 will mark the first time the French state has reduced annual public spending, excluding debt charges and pensions, since 1945.