In his first address to the French parliament, the new prime minister, Michel Barnier, has said “colossal” debt is a financial “sword of Damocles” hanging over the country, requiring cuts in public spending and tax increases, reports The Guardian.
In an hour-long inaugural address, Barnier was alternately heckled and applauded as he outlined his minority government’s political programme in the national assembly, which remains deeply divided. The lower house is split between three political blocs, none of which emerged with a majority after June’s snap general election.
“The government will not perform miracles … we will overcome each obstacle step by step,” Barnier said.
He said the biggest challenge was France’s public debt, which had reached €3.2tn, meaning repayments were now the government’s second biggest cost behind education and higher than the amount spent on defence.
“The real sword of Damocles is our colossal debt,” Barnier said. “If we’re not careful, it will take our country to the edge of the precipice.”
There were shouts and boos as he said spending cuts would be the government’s priority.
While acknowledging that France’s taxes were “among the highest in the world”, Barnier said his government would be demanding “an exceptional contribution” from profitable medium-sized and large companies and “an effort from the most wealthy”. This would be accompanied by a clampdown on “social and fiscal fraud”, he said. He did not give details of specific cuts.
The EU has urged France to reduce its deficit, which is more than 6% of its gross domestic product (GDP), well above the 5% maximum suggested by Brussels. Barnier promised that the government would reduce the deficit to 5% of GDP in 2025 and to 3% by 2029.