2023-12-08 06:30:41
Suspended during the health crisis, the stability pact imposed by the European Union on member states will return on January 1. EU finance ministers are meeting on Friday December 8 in Brussels to validate new rules.
“The current rules are completely out of step and no sanctions are applied: this discredits Europe,” explained Thursday morning to the press the Minister of Finance Bruno Le Maire, who supports the proposals of the European Commission, “with clear, credible and truly enforceable sanctions”.
The stakes are high for France which, like around ten other members, should be placed under procedure next spring “for excessive deficit”, which would limit its budgetary room for maneuver. This procedure involves reducing its structural deficit by 0.5% of GDP each year, i.e. a significantly more sustained pace than that provided for by the recent public finance programming law.
“Overly optimistic” growth assumptions
The current budgetary debate also shows the difficulty in making savings. “As soon as we have to do it, there is no one left” recently regretted the general rapporteur of the budget to the Assembly, Jean-René Cazeneuve (Renaissance), during a debate organized by the Institute of Public Policies.
“However, we have proposed a billion euros in savings on the research tax credit, several billion on kerosene and to recover 15 billion on taxation of uninvested capitalbut nothing was retained”, replied the Insoumis Éric Coquerel, president of the finance committee.
In fact, apart from 14 billion euros with the end of exceptional measures linked to the crisis, the savings in the 2024 budget were slim. And the experts judge “overly optimistic” the economic hypotheses that underlie it, particularly on growth. With the risk, if the latter was not there, of seeing the debt explode.
“Debt is not money thrown away”
“We risk finding ourselves beyond 112% of GDP in 2029, warns public finance specialist François Ecalle. This is sustainable as long as the markets do not panic like last year in the United Kingdom, where the Bank of England had to intervene. It is unlikely that the ECB will abandon a country like France or Italy, but our position will be less and less supported by our neighbors to the North or across the Rhine. » “France has a clear budgetary trajectory and, in the current negotiations, we are absolutely not hampered”, However, we assure Bercy.
“Debt is not money thrown away but is used for necessary investments, assures Éric Coquerel. If we exceed what was planned by 0.1 or 0.2 points, there is nothing dramatic about it. »
A position ultimately not so far from that defended by Bruno Le Maire, who pleads in Brussels that, even in the event of an excessive deficit procedure, countries making structural reforms and investing in ecological transition, artificial intelligence or defense benefit from a “flexibility” : 0.2 points instead of the imposed 0.5.
A ” Red line “according to the minister for whom “intense discussions” made it possible to iron out most of the differences with Germany. “The future of the continent depends on it, he assures. If the pact prohibited investment, this would mean less innovation, therefore less productivity and less growth. » This growth on which France is precisely counting to balance its accounts.
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