Budget: new €5 billion cut to public services and social security

At Bercy, things are moving in two directions. After the INSEE announced on Thursday morning, June 26, that France's public debt would increase by €40.5 billion by the start of 2025, the Ministry of Economy and Finance followed suit an hour later by unveiling a new €5 billion budget cut.

True to the "there is no alternative" to the current budgetary rigor, Bercy has taken the new deterioration of public debt as the basis for its new austerity measures. Since it now reaches 3,345.8 billion euros at the end of the first quarter, or 114% of the gross domestic product, the second "public finance alert committee" , made up of five ministers from the Bayrou government who think like him, affirmed that "respecting the public deficit target of 5.4% of GDP in 2025 remains achievable, but subject to an additional effort of 5 billion euros on spending" .

In addition to the €5 billion already frozen in the 2025 state budget, there will be an additional €3 billion cut in state funding and €1.7 billion cut from health insurance spending. "An additional reserve will be notified to ministries in the coming weeks," adds the Ministry of Finance.

On the other hand, there is still no increase in public revenue, which could, for example, involve a 2% tax on the assets of the ultra-rich or a real fight against tax fraud . Resolute in its refusal to increase compulsory levies, Bercy assures that "revenue is for the moment broadly in line with the forecasts of the initial finance law" . On the other hand, "tensions are appearing on expenditure" , hence the obligation to cut public service budgets and Social Security.

This is just a teaser. François Bayrou plans to reveal around July 14 how he intends to cut €40 billion from the 2026 public budget in order to reduce the public deficit to 4.6%.