How France's bid to tackle 'wild' budget deficit could impact you
With France's budget deficit rapidly rising and described as 'wild' by one economist, the government is facing the necessity of painful budget cuts. Here are the services likely to be targeted and how that will affect daily life in France.
On Tuesday it was revealed that France's budget deficit is now €154 billion - or 5.5 percent of GDP and set to rise even further over the next two years unless action is taken.
Both president Emmanuel Macron and his finance minister Bruno Le Maire have ruled out tax rises, and say that the money can be found through cuts to state spending.
OPINION France has been in denial for decades about its 'magic money tree' spending
Le Maire will present a package of cuts to ministers of April 17th, entitled the programme de stabilité (PSTAB).
Here's what we know so far about the proposed cuts;
Unemployment benefits
France's generous unemployment benefit system has already seen several reforms in recent years to cut both the amount of money given and the length of time that people can stay on the maximum rate. This year saw further tinkering, abolishing the allocation spécifique de solidarité (ASS) allowance for some job-seekers.
But there may be further cuts to come, especially to how long people can claim the benefit for.
Finance minister Bruno Le Maire has been pushing for a change, saying: "We need to reduce the length of the benefit period to encourage people to return to work."
Training budget
French employees benefit from a handy little thing called the Compte personnel de formation (CPF) which allocated up to €800 a year for professional development and training programmes (which, for foreigners, can include French classes). This has already been cut, with employees now having to contribute 10 percent of the cost of the training.
Health costs
The out-of-pocket costs of a medical appointment have already been doubled from 50 cents to €1 and other aspects of the health budget are being examined closely.
Le Maire in an interview with RTL ruled out any changes to payments for people with long-term medical conditions, but added that "people who are in good health and use medicines or have a lot of medical tests should probably contribute more".
READ MORE: Why medical costs are rising in France in 2024
Sick leave
The system of arrêt de travail, or taking sick leave from work is being touted as an area where savings could be made, with proposed cuts to the rate of sick pay given, as well as cuts to daily allowances for people with long-term medical conditions.
French media is reporting that the idea of making certain medical reimbursements means tested has already been rejected.
Patient transport
The cost of patient transport services - in which patients can obtain a prescription for a free or discounted taxi ride to non-emergency medical appointments - has risen sharply in recent years and is now considered a prime target for cuts.
A limited reform, linked to the reimbursement level given to taxi drivers, has already provoked months of protests from taxi drivers, including blockades at Toulouse and Bordeaux airports.
Local government and state bodies
Local governments and state-funded bodies will also be asked to make savings, Le Maire has said, saying that all branches of government need to "carefully examine their finances".
He also said that he will be writing to state-funded organisations such as the Centre national du cinéma and Business France asking them to prepare budget savings plans.
Strikes and protests
An indirect effect of any proposed budget cuts on daily life in France is that some of these measures are considered controversial and are likely to result in strikes and/or protests.
Changes to the system of unemployment benefits during Macron's first term as president provoked widespread protests and any significant cuts would be likely to trigger union action up to and including strikes.
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On Tuesday it was revealed that France's budget deficit is now €154 billion - or 5.5 percent of GDP and set to rise even further over the next two years unless action is taken.
Both president Emmanuel Macron and his finance minister Bruno Le Maire have ruled out tax rises, and say that the money can be found through cuts to state spending.
OPINION France has been in denial for decades about its 'magic money tree' spending
Le Maire will present a package of cuts to ministers of April 17th, entitled the programme de stabilité (PSTAB).
Here's what we know so far about the proposed cuts;
Unemployment benefits
France's generous unemployment benefit system has already seen several reforms in recent years to cut both the amount of money given and the length of time that people can stay on the maximum rate. This year saw further tinkering, abolishing the allocation spécifique de solidarité (ASS) allowance for some job-seekers.
But there may be further cuts to come, especially to how long people can claim the benefit for.
Finance minister Bruno Le Maire has been pushing for a change, saying: "We need to reduce the length of the benefit period to encourage people to return to work."
Training budget
French employees benefit from a handy little thing called the Compte personnel de formation (CPF) which allocated up to €800 a year for professional development and training programmes (which, for foreigners, can include French classes). This has already been cut, with employees now having to contribute 10 percent of the cost of the training.
Health costs
The out-of-pocket costs of a medical appointment have already been doubled from 50 cents to €1 and other aspects of the health budget are being examined closely.
Le Maire in an interview with RTL ruled out any changes to payments for people with long-term medical conditions, but added that "people who are in good health and use medicines or have a lot of medical tests should probably contribute more".
READ MORE: Why medical costs are rising in France in 2024
Sick leave
The system of arrêt de travail, or taking sick leave from work is being touted as an area where savings could be made, with proposed cuts to the rate of sick pay given, as well as cuts to daily allowances for people with long-term medical conditions.
French media is reporting that the idea of making certain medical reimbursements means tested has already been rejected.
Patient transport
The cost of patient transport services - in which patients can obtain a prescription for a free or discounted taxi ride to non-emergency medical appointments - has risen sharply in recent years and is now considered a prime target for cuts.
A limited reform, linked to the reimbursement level given to taxi drivers, has already provoked months of protests from taxi drivers, including blockades at Toulouse and Bordeaux airports.
Local government and state bodies
Local governments and state-funded bodies will also be asked to make savings, Le Maire has said, saying that all branches of government need to "carefully examine their finances".
He also said that he will be writing to state-funded organisations such as the Centre national du cinéma and Business France asking them to prepare budget savings plans.
Strikes and protests
An indirect effect of any proposed budget cuts on daily life in France is that some of these measures are considered controversial and are likely to result in strikes and/or protests.
Changes to the system of unemployment benefits during Macron's first term as president provoked widespread protests and any significant cuts would be likely to trigger union action up to and including strikes.
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