why even the Court of Auditors doesn’t imagine it | EUROtoday

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Une week after making public its trajectory for decreasing the general public deficit, the Ministry of the Economy had it authorised this Wednesday within the Council of Ministers. If the members of the federal government judged this program “safe, coherent and responsible”, the High Council of Public Finances – an emanation of the Court of Auditors – is strangled.

“This forecast lacks credibility”, “its documentation remains incomplete at this stage”, it “also lacks consistency”… In the well mannered language of economic magistrates, the sentence has the impact of a sledgehammer. In an opinion made public this Wednesday, the Sages of rue Cambon analyze how the federal government intends to go about transferring, because it guarantees, from a deficit established at 5.5% of GDP in 2023 to five, 1% in 2024 then… 2.9% in 2027.

This trajectory should quickly be communicated to the European Commission. To fall beneath 3% in 2027, Bercy is relying on “effective growth of 1.6% on average per year over the years 2025 to 2027”, notice the magistrates who think about this forecast “high”. “It is based in particular on an increase in household consumption, significantly higher than that recorded before the health crisis, due in part to the drop in their savings rate, possible but not acquired,” they write.

For 2024, the federal government's development forecast (1%) is “higher than that of the average of the forecasters surveyed”, underline the magistrates whereas the International Monetary Fund (IMF) lowered its development forecasts for France to 0 on Tuesday. .7% in 2024.

Documentation of “lacunous” economies

According to the federal government's situation, the deficit should improve from 5.1% in 2024 to 4.1% in 2025 then 3.6% in 2025. “A return of the public deficit below 3 points of GDP in 2027 would require a massive structural adjustment between 2023 and 2027 (2.2 points of GDP over four years)”, calculates the High Council of Public Finances which estimates the financial savings to be made for the yr 2025 alone at 27 billion euros. A situation that struggles to persuade them: “this requires a powerful boost, which remains to be demonstrated,” they write.

Bercy introduced on April 10 ten billion extra financial savings in 2024 and intends to put this effort on ministries, native authorities and improve its revenues by way of “taxation of annuities”. “While such an effort in spending has never been made in the past, its documentation remains incomplete at this stage”, sort out the Sages.

In an interview with Figaro, the president of the Court of Auditors, Pierre Moscovici, provides that “its achievement requires the meeting of extraordinarily demanding conditions”. The magistrates additionally imagine that these changes will essentially weigh on development, info which was not taken under consideration within the authorities's situation.

Finally, the High Council of Public Finances permits itself some recommendation. “A re-examination of the planned reductions in compulsory deductions” is important, they imagine. “France, in the current situation, does not have the means to achieve “dry” tax cuts, that’s to say not compensated by not less than equal financial savings”, insists the president of the Court of Justice. accounts, Pierre Moscovici, within the Figaro. Enough to gasoline the talk already happening inside the majority on fiscal leverage.