France’s budgetary situation is “very serious”, Prime Minister Michel Barnier told AFP on Wednesday, saying more information was needed to gauge the “precise reality” of French public finances.
France was placed on a formal procedure for violating European Union budgetary rules before Barnier became head of government earlier this month, while the Bank of France warned this week that a projected return to EU deficit rules by 2027 was “not realistic”.
France’s public sector deficit is projected to reach around 5.6 percent of GDP this year and go over six percent in 2025, which compares with EU rules calling for a three-percent ceiling on deficits.
Barnier, appointed by President Emmanuel Macron after protracted wrangling in the wake of an inconclusive parliamentary election, has floated possible tax rises to help stabilise finances, a measure Macron has ruled out during the seven years he has been president.
“I am discovering that the country’s budgetary situation is very serious,” Barnier said in a statement to AFP.
“This situation requires more than just pretty statements. It requires responsible action,” he said.
The new prime minister, who has yet to appoint a cabinet, is to submit a 2025 budget to parliament next month, in what is expected to be the first major test for the incoming administration.
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