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France begins debate on EU austerity treaty

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France begins debate on EU austerity treaty
Photo: Elliott Brown
11:04 CEST+02:00
The French parliament Tuesday opened a difficult debate on an EU fiscal pact that is key to efforts to overcome the eurozone debt crisis but which critics slam as austerity forced by Brussels.

The National Assembly debate comes after tens of thousands of left-wing protesters marched through Paris on Sunday denouncing EU-imposed belt-tightening, although they insisted they were not criticising the government of Socialist President Francois Hollande.

Prime Minister Jean-Marc Ayrault set the tone, saying France would not be sacrificing its "sovereignty" by ratifying the text.

"The treaty itself imposes no constraints on public spending," he said. "It does not specify how it should be distributed. It does not dictate the methods one has to take to balance public finances.

"Fiscal sovereignty will remain with parliament," he said.

Hollande's cabinet has already backed the pact, which includes a so-called golden rule requiring countries with high debt to keep their structural deficits below 0.5% of gross domestic product.

Ayrault said France's Constitutional Council had "already ruled on this matter and no 'golden rule' will be enshrined in our basic law," he said.

Hollande has acknowledged that the going will be tough, saying that "it is true that the situation is difficult".

Ayrault earlier voiced hope that the measure would be "massively adopted" by parliament, adding "the stronger the vote, the stronger will be France's voice and the more we can continue to work towards the reorientation of Europe."

Many on the French left -- including within the Socialists and their Green Party allies -- have said they will vote against the measure but, with right-wing deputies backing the pact, it is expected to be approved.

On Friday, Hollande's government unveiled a 2013 budget aimed at plugging the €37 billion ($47 billion) hole in France's public finances through tax increases and spending cuts.

Ayrault had earlier also taken pains to stress that Hollande had not given in to Germany, the European Union's main paymaster, by implementing austerity policies.

In line with a pact agreed by eurozone leaders earlier this year, France is committed to reducing the size of its deficit from around 4.5% of GDP this year to 3% in 2013 and to balance the budget by 2017.

The issue is divisive. Far-left leader Jean-Luc Melenchon -- who led Sunday's protest in Paris -- has warned of "collapse" if spiraling unemployment, now over three million, continues to rise, and called for a referendum.

On Tuesday he said the "government is unmasked" adding that "contrary to what Ayrault said ... this is universal austerity" for Europe.

"The Greek, Portuguese and Spanish crises will now be on the agenda in France."

Far-right leader Marine Le Pen of the National Front has also urged a vote be held to "determine our destiny as a sovereign nation".

Signed in March, the pact must be approved by 12 of 17 eurozone members to take effect at the start of next year.

Nine eurozone states have ratified the pact so far.

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