While inflation has soared in recent months in France, the government has prepared a package of measures estimated at 20 billion euros intended to preserve the purchasing power of the French. A dedicated bill has been examined since Monday by the deputies, which is combined with another amending finance bill also examined this Thursday in the Assembly.
A package of measures to be financed. Examined in public session in the Assembly since Monday, July 18, the “purchasing power” bill is supposed to relieve the wallets of the French.
Against the background of the war in Ukraine, inflation in France indeed accelerated again in June, to 5.8% over one year, confirmed INSEE on July 13th. A threshold that had not been recorded in France since 1985.
To deal with it and help the French to face the economic difficulties resulting from it, the government has therefore prepared a series of measures valued at 20 billion euros.
respond to the new economic situation
This is where the amending finance bill (PLFR) examined by the deputies from this Thursday comes in. To release the necessary funds, the government indeed had to prepare a “corrective” text to the finance bill already in force.
An amending finance bill can thus be proposed by the government when the country is faced with a new economic situation that reshuffles the cards. And this is precisely what the Ukrainian conflict, but not only, has caused everywhere in Europe and therefore in France.
In detail, the PLFR thus aims to finance all the measures presented in the emergency bill for the protection of purchasing power, which includes a 3.5% increase in the personalized housing allowance. (APL), a reduction in contributions for the self-employed, an increase in the index point for the civil service by 3.5% on 1er July and the revaluation of 4% of the activity bonus, retirement pensions, family allowances and social minima.
The text also provides for exceptional back-to-school aid, paid from September, set at 100 euros per adult and increased by 50 euros for each dependent child for beneficiaries of active solidarity income allowances (RSA) and disabled adult allowance (AAH). This aid will also concern scholarship students, whose scholarship will be increased by 4% from the start of the academic year.
Similarly, the PLFR incorporates the abolition of the audiovisual license fee from the start of the next school year. To compensate for its disappearance, the financing of public audiovisual will be allocated to the general budget, in which a new “public audiovisual” mission will be created.
The text of the law must finally incorporate measures in favor of education, with an expected salary increase for personnel in the sector. Other systems put in place by the executive during Emmanuel Macron’s previous mandate, such as “1 Young 1 solution” or the “Grenelle de l’éducation”, must be continued and finalized.
The subject of overtime will also be on the agenda with negotiations and amendments planned around the overtime tax exemption ceiling.
Public finances already very degraded
The thorny issue of energy is of course not to be outdone and, in addition to the rebate of 18 cents on fuel, in force at least until September before being gradually reduced, the PLFR must also compensate the tariff shield on gas and electricity renewed until the end of the year.
Only then, overall, the amending finance bill for 2022 provides for a budget deficit of 168.5 billion euros, i.e. a deterioration of 14.6 billion euros compared to the initial finance law, while France is in an already very degraded economic situation.
According to INSEE data, France’s public debt now stands at nearly 3,000 billion euros, compared to 94.1 billion euros in 1980. This represents approximately 44,000 euros per inhabitant, compared to 1,710 euros in 1980.
However, Emmanuel Macron repeats over and over that there will be no tax increases, despite repeated alerts from the Court of Auditors on the debt.
The hypothesis of an exceptional taxation on the profits of large groups, pushed by the left, is also ruled out. At least for the moment, the idea making its way into the ranks of the majority, twelve Renaissance deputies, the party of the president, having even tabled an amendment to the “purchasing power” bill precisely to create this tax.