Introduction of Austerity Measures by French Prime Minister François Bayrou
On Tuesday, French Prime Minister François Bayrou unveiled a fiscal adjustment plan worth 43,800 million euros (approximately $50 billion) by 2026. The plan aims to reduce the public deficit and finance increased military spending.
Key Measures in the Plan
- Reduction of Public Officials: The plan includes decreasing the number of public servants.
- Freezing Pensions: Pension benefits will be frozen in 2026.
- “Solidarity Contribution”: A tax increase on the wealthiest citizens.
- Elimination of Two Holidays: The removal of two public holidays: Easter Monday and May 8, commemorating the victory over Nazi Germany.
Context and Rationale
France’s public finances have been under strain, with a public deficit of 5.8% of GDP in 2024 and a public debt reaching nearly 114% of GDP in March, the highest in the EU after Greece and Italy. Prime Minister Bayrou emphasized that everyone must participate in the effort to tackle this significant challenge.
Bayrou presented a grim outlook for France, citing global violence, wars, and trade tensions like those instigated by Donald Trump’s tariffs. He described the debt as “a mortal danger for a country” and a “curse without escape,” lamenting that France has become “addicted to public spending.”
His primary goal is to lower the public deficit to 4.6% of GDP by 2026 through a fiscal adjustment of 43,800 million euros and achieve a deficit of 2.8% by 2029, below the European rules limit.
Although initially planning to save 40,000 million euros, President Emmanuel Macron pushed for increasing military spending to 64,000 million euros by 2027 from the original 6,700 million euros in 2026. Macron highlighted that since 1945, freedom has never been as threatened, emphasizing Russia’s “enduring threat” to Europe following its invasion of Ukraine in 2022.
Political Challenges
The proposed measures face a challenging parliamentary process, especially the elimination of two public holidays. Opposition parties from both the left and far-right have threatened to reject the budget if not convinced.
Marine Le Pen, leader of the far-right party, vowed to censor Bayrou’s measures if they remain unchanged. Jean-Luc Mélenchon, leader of the left-wing radical party, also called for toppling the government, accusing Bayrou of attempting to dismantle public services and protect the wealthy.
Bayrou’s plan also includes closing “unproductive public agencies,” reducing social spending by over 5 billion euros through lower reimbursement of medications and freezing social benefits.
Key Questions and Answers
- What is the main goal of the proposed austerity measures? The primary objective is to reduce France’s public deficit and increase military spending.
- Who proposed these measures, and what is his political affiliation? French Prime Minister François Bayrou, a member of the centrist Democratic Movement party.
- What are some of the key measures included in the plan? Reducing public officials, freezing pensions, a “solidarity contribution” tax on the wealthy, and eliminating two public holidays.
- Why is increased military spending necessary, according to the French government? The government cites global violence and threats from Russia as reasons for boosting military expenditure.
- What challenges does Bayrou face in implementing these measures? Significant political opposition from both left and far-right parties, threatening to reject the budget if not convinced.
