The French government is facing challenges in preparing for the 2025 budget, as the public deficit is projected to be higher than previously estimated.
The current Minister of the Economy, Finance, and Industry, Antoine Armand, has indicated that the deficit for 2024 could range between 6.1% and 6.2% of GDP, which is higher than the previous estimate of 5.1%.
The government aims to reduce the deficit to 5% by 2025 through a budgetary effort of €60 billion, including €20 billion from tax increases and €40 billion from spending cuts.
However, there are political tensions and debates among lawmakers regarding the direction of the budget. The President of the French National Assembly has urged the Prime Minister to clarify the government's stance on the revenue aspects of the budget.
The budget discussions have been suspended without reaching a consensus, and the next round of debates is scheduled to resume on November 5.
Internal party dynamics and opposition to leadership roles within the Renaissance party further complicate the political landscape.
The government is also considering health sector reforms, including a tax on processed sugars and a potential reduction in the Social Security reimbursement rate for medical consultations. These reforms could impact the cost of healthcare for French citizens.
Prime Minister Michel Barnier aims to present a comprehensive project in early December, which may include initiatives such as an industrial savings account and a unified social allowance. These proposals reflect a strategic approach to governance and addressing long-term economic challenges.
The government hopes to foster a more inclusive dialogue with the electorate by addressing grievances and drawing on feedback from local councils.
The interplay between fiscal responsibility and political maneuvering will be critical in shaping France's economic trajectory in the coming years.