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January 27, 2022

Paris announces fresh austerity in bid to save triple-A rating

The French government has announced a fresh round of austerity measures worth some EUR 19 bln in spending cuts and tax hikes in an attempt to stave off a downgrade of the country’s triple-A credit rating, euobserver.com reports. The move, announced by Prime Minister Francois Fillon, is the second such austerity package in three months, leaving citizens to wonder if this is the last such bout of belt-tightening. In August, the government unveiled EUR 12 billion in spending cuts and other fiscal rearrangements, but they have yet to be implemented. “We have one objective: protect French people from the serious difficulties experienced by several European countries,” the prime minister said in announcing the measures. “Our economic, financial and social sovereignty demands collective and prolonged efforts, and even some sacrifices.” The government is to accelerate the move to raise the retirement age from 60 to 62, bringing the change into force from 2017 instead of 2018, a move that could provoke trade unions’ire.  The package will also see a freeze on the salaries of all members of the government, although, as the opposition was quick to point out, President Nicolas Sarkozy awarded himself a 150 percent salary rise immediately after entering office in 2007. The savings will be spread over the next two years, with EUR 7 bln in 2012 and EUR 11.6 bln in 2013.

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