Economic rebound, deficit and debt reduction, at least a stabilization of the number of civil servants, stimulus plan: here are the key figures of the government’s 2021 draft budget.
The Ministry of the Economy. (illustration) (AFP / LOIC VENANCE)
The government will present its draft budget for 2021 on Monday, which will give pride of place to the recovery plan of 100 billion euros over two years, in a context of record economic crisis that has relegated deficit reduction to the background.
o 8%, the rebound
This is the growth rebound planned by the government for 2021, after a historic fall of 10% of gross domestic product (GDP) expected this year. The government is counting in particular on the recovery plan of 100 billion euros to gain 1.5 points of GDP next year. On the other hand, he warns that uncertainties hover over this forecast , because of the evolution of the health situation, the outcome of negotiations on the post-Brexit relationship between the European Union and the United Kingdom, or the results of the American election.
o 6.7%, the relaxation
After a record deficit of 10.2% of GDP this year due to the efforts made to fight the health and economic crisis, the government plans for 2021 a sharp decline in the public deficit as a proportion of GDP, partly mechanical with the economic recovery expected next year. However, this deficit will remain high at 6.7%, with the spending planned in the recovery plan and in the health sector. Same thing for public debt, expected at 116.2% of GDP in 2021 , after its flight forecast at 117.5% this year.
This slackening of the control of the public accounts is allowed by the suspension by Brussels of the rules of budgetary seriousness at European level.
o 100 billion, the remedy
This is the amount of the recovery plan, planned for two years and which will be integrated into a specific mission of this finance bill for 2021. Of these 100 billion euros, around 10 billion to be spent by the end of 2020 , and a third, or about 30 billion, should actually be in 2021, according to Bercy.
Main points of the French government’s 100 billion euro economic recovery plan (/)
In total, it has three components: 30 billion dedicated to ecological transition, 35 billion dedicated to the reindustrialization of the country and the improvement of the competitiveness of companies, and finally 35 billion for social and territorial cohesion, in particular the safeguard of employment.
o 10 billion, the breath of fresh air
This is the expected decrease in the amount of production taxes paid by companies , and denounced for a long time by the employers as an obstacle to competitiveness, in particular in industry. This tax measure was in the government’s hands long before the crisis, and it will involve the halving of the contribution on the added value of companies (CVAE), or -7 billion euros, and the reduction of taxes by half. land (CFE) weighing on industrial sites (-3.3 billion).
According to the government, this reduction in production taxes will benefit 42% to medium-sized enterprises (ETI), 32% to SMEs and 26% to large companies.