Macron targets welfare spending

Reuters / No Comments Share:
AFP

PARIS (Reuters) – French President Emmanuel Macron’s government will tackle social spending in the next wave of its reforms as weaker than expected growth puts pressure on the budget deficit, the prime minister said on Sunday.

For in depth analysis of Cambodian Business, visit Capital Cambodia
.

Prime Minister Edouard Philippe said in an interview in Le Journal du Dimanche that the government would press on with its reform drive in the face of record unpopularity after little more than a year in office.

Mr Macron has so far largely turned a deaf ear to criticism of his reforms, with detractors dubbing him the president of the rich after cuts to taxes on capital income during his first year in office, which he said encouraged investment.

His government has sold its pro-business reforms on promises that they will boost growth and jobs, but Philippe said that growth would be weaker than expected next year.

Mr Philippe told Le Journal du Dimanche that the 2019 budget would be based on a growth forecast of 1.7 percent rather than the 1.9 percent forecast in April.

The prime minister acknowledged that the lower growth is likely to weigh on the public budget deficit, which is already under pressure from plans to make a payroll tax credit scheme permanent.

“But that does not prevent us from sticking to our commitments on reducing taxes while reining in public spending and debt,” he added.

The slower growth outlook raises the chances that when the government produces its 2019 budget at the end of September it may need to change its public deficit target, previously pegged at 2.3 percent of economic output.

Share and Like this post

Related Posts

Previous Article

Investors to get their say after failed Tesla buyout

Next Article

KC Airlines given AOC