France’s delayed 2025 budget bill will aim for a deficit “slightly above 5%” to protect economic growth, the country’s new Finance Minister Eric Lombard said in an interview with the French weekly financial newspaper La Tribune Dimanche.
Lombard, who previously led Caisse des Dépôts, has been tasked with navigating the budget through parliament following the previous government’s no-confidence defeat in December over austerity measures.
The new target is higher than the 5% deficit proposed by the prior administration but marks a reduction from the current year’s deficit, which is expected to exceed 6% of GDP. “We need to amend this (budget) bill to establish a good budget. With a deficit slightly above 5% so as to protect growth,” Lombard said.
He emphasized the importance of reducing the deficit through spending cuts rather than tax increases, stating that any tax hikes should be “very limited.” Lombard also plans to consult all political parties in parliament, incorporating their input into the government’s budget proposals.
Lombard’s appointment last Monday is part of Prime Minister Francois Bayrou’s government, which faces challenges due to a lack of a parliamentary majority. Bayrou has set a mid-February deadline for finalizing the budget, signaling a push for consensus in addressing France’s fiscal challenges.
