Finance and Economy Bruno Le Maire will defend his €10 billion savings plan for 2024 before the finance committees of the Assemblée Nationale and Sénat on Wednesday, March 6. In an interview with Le Monde, he asserted that this is simply a first step. And he has set himself the target of a balanced budget by 2032.

You’re calling for €10 billion in savings committed by the government this year. Even if it means putting the burden of this effort on sectors that represent the future, such as education or the environment?

We are making a single choice: to restore public finances. This must take us below a 3% public deficit by 2027, and to a balanced budget by 2032. Reducing state spending by €10 billion is a first step. We are doing this without calling into question the major public policies championed by the president: the environment, education, health and labor have all seen their budgets increase since 2017. At some point, we simply have to cool the machine, because growth is suffering the consequences of the new geopolitical environment and tax revenues are falling. When you earn less, you spend less.

Doesn’t “cooling the machine” at a time when economic growth is slowing down run the risk of destroying growth, as was the case during the sovereign debt crisis?

Let me reassure you, we’re a long way from austerity when we’re at 58% of public spending in GDP! There is €496 billion of government spending per year, we’re saving €10 billion: We’ll get over it. We’re increasing the budget for MaPrimeRénov [a subsidy to help housing renovations], so don’t let it be said that this could have an impact on the building trade – it won’t. We’re cutting employment subsidies at a time when unemployment is low and job shortages remain high, so let’s not suggest that this could have an impact on growth. Let’s change our way of thinking: Public spending is not the alpha and omega of growth.

Will the deficit in 2023 be much higher than forecast?

Due to the loss of tax revenue in 2023, we will be significantly above 4.9%. The €10 billion is not a cut but an emergency brake.

And a first step?

It is legitimate for the state to set an example. But if you don’t touch social spending, you can’t balance public finances. So you need other steps and a timetable.

After these €10 billion in savings, the second stage could be a corrective budget in the summer, if necessary. The third will be the 2025 budget, in which we’ll have to find at least €12 billion in savings. We’re not catching anyone by surprise.

You have 76.41% of this article left to read. The rest is for subscribers only.