The first president of the Court of Auditors Pierre Moscovici on Tuesday wanted a French objective in terms of “more ambitious” debt reduction, saying he was “concerned” by its current pace.
“I’m a bit concerned,” Moscovici said, speaking to REF 2023, Medef’s summer university, “because compared to other European countries, we’ve increased our debt more and we’re reducing it much more slowly. “.
He stressed that there was currently no “debt sustainability problem”, but that “what is worrying is the slope”.
“I am in favor of its curve being reversed before 2027, that is to say from 2026”, and “significantly”, he then told AFP.
He added that this required “ambitious objectives, realistic assumptions and a credible path”, marked by “considerable” savings which he estimated at some 60 billion euros by 2027, i.e. a dozen billion per year”.
The government plans to reduce the public deficit to 2.7% of GDP in 2027: it must be “significantly below” 3%, underlined Mr. Moscovici.
As for the government’s fiscal policy, he considered that with 45.4% of GDP in compulsory levies, increasing taxes was an idea “which does not seem serious to him”, and that “consent to taxation is reaching the limit” .
However, he is not for “dry tax cuts”: “With a public deficit of 4.9% of GDP (expected for 2023, editor’s note) and growth of 1%, “if we lower taxes, it must increase other taxes or make additional savings”.
In April, the government lowered its public deficit forecast for 2027 to 2.7% of GDP, which was 2.9% previously.
The public deficit, which was 4.7% of GDP in 2022, will rise slightly to 4.9% this year, before gradually declining from 2024.
The deleveraging planned by the government promises to be slow, with forgotten debt still representing 108.3% of GDP in 2027, very far from the European objective of 60%. It was 111.6% of GDP at the end of 2022, and passed in volume the bar of 3,000 billion euros at the end of June, reaching 112.5% of GDP.
At the end of September, the government plans to present to Parliament a public finance programming law (LPFP) which must define, for each year between 2023 and 2027, the objectives for reducing the public debt and deficit that Paris has set itself.