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BRUSSELS ― The European Commission has endorsed the new French government’s updated spending plan in a boost to Prime Minister François Bayrou, two diplomats told POLITICO.
Ambassadors and financial counsellors from the EU’s member countries will discuss the plan in meetings today, the diplomats said.
French Finance Minister Eric Lombard publicly promised to keep the commitment to reduce France’s deficit ― the difference between how much a country spends and how much it brings in ― to the EU’s 3 percent of gross domestic product threshold by 2029. Last year it was a whopping 6.2 percent.
Michel Barnier, the former European Commissioner, was toppled as prime minister last month before even making it to 100 days in office, over opposition to his 2025 budget within the French parliament. The new government, under Bayrou, announced a slightly gentler version.
This iteration includes a €53 billion combination of spending cuts and tax increases to bring order to France’s increasingly haywire public finances.
According to one diplomat, France will now have a higher net expenditure ― the main indicator taken into account under the EU’s revamped fiscal rules ― but the average net expenditure over seven years will remain the same. That’s why the Commission looks upon the plan kindly.
EU finance ministers are likely to look at the plan at their meeting on Tuesday and will be asked to approve it.
“They are rushing the amended plan through the European financial counsellors and Coreper today to get it on the finance ministers’ meeting agenda,” one diplomat said.
