• France's news in English

French MPs give green light to €50 billion cuts

AFP/The Local · 30 Apr 2014, 08:22

Published: 30 Apr 2014 08:22 GMT+02:00

Facebook Twitter Google+ reddit

France's reshuffled government scraped through its first major test Tuesday when parliament's lower house voted through a controversial programme of economic reforms despite a wave of dissent within the ruling Socialist party.

President Francois Hollande and Prime Minister Manuel Valls have made a business-friendly programme of reductions in payroll and income taxes the centrepiece of their plan to lift the country out of the economic mire.

But the strategy has provoked deep misgivings within their own party, with lawmakers questioning the morality and economic logic of the proposals to cut €50 billion ($70 billion) from state spending over the next three years, partly through freezing a range of welfare benefits and the pay of most public sector workers.

As such, all eyes were on a consultative vote held in the National Assembly on Tuesday evening, which eventually saw 265 lawmakers vote the plan through, 232 cast their ballots against it and 67 abstain.

Valls immediately welcomed the outcome.

"It was essential... that there be a vote that showed that the majority, beyond all the debates, approved this project," he told parliament.

But the economic plan was hard won and 41 Socialist lawmakers abstained from voting, highlighting the deep unease within the ruling party over the plan.

Valls, who replaced former prime minister Jean-Marc Ayrault at the end of March after the Socialists suffered a drubbing at local elections, had tried to soothe the rebel left of his party on Monday.

He unveiled a series of concessions on the spending cuts that will notably ensure some five million pensioners are no longer affected by the welfare freeze. But these failed to appease some who are against the government's so-called Stability Programme.

'Moment of truth' 

Often compared to former British premier Tony Blair, Valls is a controversial figure within the Socialist party - his hardline stances on immigration and crime led to frequent clashes with fellow ministers during his
time as interior minister.

But he is close to Hollande and the president has given him unequivocal backing over a cuts package which aims to ensure France brings its budget deficit into line with European Union rules while freeing up funds for the planned tax and payroll cuts.

The strategy reflects a widely held perception that France's corporate sector has become uncompetitive and that the heavy tax burden on employers is acting as a brake on job creation.

Story continues below…

This is seen as making it much harder for the economy to gain any momentum as it struggles to emerge from years of recession and stagnation which has left the country with record unemployment.

Valls's most important concession to the rebels in his party was a pledge that the welfare freeze would not be applied to pensioners living on less than €1,200 a month - a measure which will cost an estimated €300 million to deliver.

He also agreed to resume inflation-linked pay rises for the lowest-paid public sector workers and said he would proceed with a revaluation of the minimum level of state income support for the long-term unemployed from this year, rather than delaying it until 2015.

The premier has however insisted on maintaining the overall target of €50 billion in cuts between 2015 and 2017, so the cost of the concessionswill have to be recovered elsewhere.

AFP/The Local (ben.mcpartland@thelocal.com)

Facebook Twitter Google+ reddit

Your comments about this article

Today's headlines
Where exactly in France are Calais migrants being sent?
Photo: AFP

Here's where the 8,000 migrants in Calais are heading.

The annoying questions only a half French, half British person can answer
Photo: Beery/Flickr/AFP

Being half French, half British is means you get asked a lot of questions (and some of them can be a little annoying.)

Migrants bussed out of Calais Jungle to all corners of France
All photos: AFP

Hundreds of migrants are being bussed across France on Monday ahead of the demolition of the Jungle camp.

The must-see French films of the millennium - Part One
A Prophet. Photo: YouTube Screengrab

Looking for something to watch?

The must-see French films of the millennium - Part Two
Rust and Bone. Photo: YouTube Screengrab

The newest French films you need to see before you die (or alternatively when you get some spare time).

Election Watch
Presidential hopeful reckons a pain au chocolat is 10 cents

So France happily takes the pastry out of him.

French ministry of defence officials die in plane crash
Screengrab: eddydeg/Twitter

The French Ministry of Defence officials were killed on Monday when a light aircraft went down on the island of Malta.

Revealed: The ten most stolen cars in France
A Smart car in Paris. Photo: JR_Paris/Flickr

Thieves in France are getting a taste for luxury cars, it seems.

Analysis - France migrant crisis
Migrant crisis won't end with Calais 'Jungle' closure
All Photos: AFP

The Jungle camp may be being cleared but this won't be the end of the migrant crisis in France.

Brad Pitt and Angelina Jolie 'to sell their French chateau'
All photos: AFP

Want to live where Brangelina got married?

The annoying questions only a half French, half Brit can answer
Sponsored Article
Last chance to vote absentee in the US elections
Forget Brangelina's chateau - here are nine others you've got to see
The must-see French films of the millennium - Part One
How life for expats in France has changed over the years
Why Toulouse is THE place to be in France right now
Video: New homage to Paris shows the 'real side' of city
The 'most dangerous' animals you can find in France
Swap London fogs for Paris frogs: France woos the Brits
Anger after presenter kisses woman's breasts on live TV
Is France finally set for a cold winter this year?
IN PICS: The story of the 'ghost Metro stations' of Paris
How to make France's 'most-loved' dish: Magret de Canard
Welcome to the flipside: 'I'm not living the dream in France'
Do the French really still eat frogs' legs?
French 'delicacies' foreigners really find hard to stomach
French are the 'world's most pessimistic' about the future
Why the French should not be gloomy about the future
This is the most useful French lesson you will ever have. How to get angry
Why is there a giant clitoris in a field in southern France?
French pastry wars: Pain au chocolat versus chocolatine
Countdown: The ten dishes the French love the most
Expats or immigrants in France: Is there a difference?
How the French reinvented dozens of English words
jobs available