France to cut additional spending by €4.7 billion due to record high debt - Politico

The French government has announced that it will cut spending by nearly €5 billion this year to help meet its budget deficit target of 5.4% of gross domestic product. This is reported by UNN with reference to Politico.

Details

The Ministry of Economy said on Thursday that the cuts were necessary because government spending this year was higher than planned in the 2025 budget, although the amount of tax revenue is in line with expectations, at least for now.

The government will cut €3 billion from the central government budget and €1.7 billion from social security spending in addition to the €5 billion that was cut in April. The initial budget, adopted earlier this year, included €53 billion in spending cuts and tax increases.

"The additional efforts adopted today reflect a clear determination to act immediately to achieve our goals of controlling public finances and debt," said Economy and Finance Minister Éric Lombard.

Measures to cut health care spending include reducing the amount spent on reimbursing medicines and medical services, while government ministries will be asked to tighten their belts to contain the state budget, which is reflected separately from the social security budget.

French PM faces another no-confidence vote - Reuters25.06.25, 10:07 • 2500 views

France has struggled to contain public spending in recent years. New data from the country's statistics agency Insee showed that the country accumulated an additional €40.5 billion in debt in the first three months of this year, bringing the total to €3.3 trillion - a new record.

The government has pledged to reduce the budget deficit, which stood at 5.8% of GDP in 2024, to 3% by 2029, as required by EU rules. And Prime Minister François Bayrou has pledged to find another €40 billion in savings for next year's budget, although his minority government may not last long enough to implement its plans.

The French Prime Minister no longer enjoys the tacit support of the center-left Socialist Party, which filed a motion of no confidence in his government after Bayrou's highly publicized pension reform deal fell apart without an agreement.

Bayrou is expected to survive the censure, as Marine Le Pen's National Rally has said it will not vote to oust Bayrou now. But the far-right party has made it clear that it may try to oust his government in the fall, when discussions on the 2026 budget are in full swing.

Addition

The French National Assembly did not support the motion of no confidence in the government of François Bayrou, gaining only 128 votes out of the required 288. The Prime Minister immediately invoked the article of the Constitution to pass the decision without a vote by the deputies.