How France's latest plan to cut spending could impact you

Local France

16-04-2025

On Tuesday, French Prime Minister François Bayrou gave a speech at a conference on public spending where he outlined the urgent need to find between "€40 and €50 billion in savings".
Bayrou slammed France's debt, noting that changes were necessary and that the "survival of our country is at stake."
While Bayrou did not offer any specific plans, he called tax increases an 'unsustainable' solution, despite the fact that the government is reportedly considering maintaining what was meant to be a
one-time special tax on high-earners.
The prime minister explained that more details would be announced on July 14th, but he did offer some general areas that the government would focus on to decrease France's debt.
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Producing more
The details in July are likely to include provisions to increase employment and production, particularly amongst the youth and older workers (55+).
Bayrou
argued
that France "lacks to means to finance its policies because it doesn't produce or work enough." He highlighted the importance of "restoring production" and "reindustrialisation".
The prime minister specified the need for France to reduce its "agricultural, industrial and intellectual dependence", which could be accomplished either through producing more or changing consumption patterns.
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Working more
In terms of employment, the PM argued France would need to work more, namely in regard to young people and seniors, who he claimed have a lower employment rate than the same groups in other European countries.
However, the latest European figures are from 2023, and those showed that France was average. In 2023, France's youth employment rate (people under 24) was 35.2 percent (about the same as Portugal).
The youth employment rate was lower in Italy and Spain, whereas the Germans, Danes and Dutch had higher youth employment levels,
Radio France
reported.
For older people (55-64), Bayrou was correct that France was below the average, with 58 percent of this cohort employed, in contrast to the EU average of 64 percent.
Changes to sick leave
The public accounts minister, Amélie de Montchalin, also made some announcements at the press conference.
She explained that the government aims to reduce public spending by six percent by 2029, and she specifically highlighted the need to combat the "very serious increase in sick leave" (
congé/ arrêt maladie
).
According to reporting by
Capital France
, employee absenteeism had increased 41 percent since 2019 (the last year pre-Covid-19).
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Capital France found that the "increase is mainly explained by the increase in frequency of long-term absences (more than two months), which increased by 7.5 percent between 2023 and 2024". Amongst the increase in sick leave, mental health related leave periods are now the leading cause of long-term absences, particularly amongst younger workers.
Ending tax breaks and loopholes
Montchalin also called for greater "accountability" in public services.
Even though Bayrou joked about France giving people a "bonus for taking their shoes to the cobbler", Montchalin reiterated the fact that the government would make an effort to decrease tax benefits and loopholes.
Montchalin in a separate interview with TF1 on Wednesday said: "There are 467 tax loopholes, several dozen of which benefit fewer than 100 taxpayers."
She did not offer any details about which tax breaks would be targeted, but this will likely be specified with greater detail in July.
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