Budget 2020: the government denies abandoning support for businesses

Medef criticized the finance bill for 2020, which would threaten to “stall the engine of growth”. Bruno Le Maire rejected these attacks and assured that the government remained faithful to its policy of the offer.

Bruno Le Maire and Gérald Darmanin, heard before the Finance Committee of the National Assembly chaired by Eric Woerth, defended the government's budgetary choices.

End of the honeymoon? Rather well served since the start of the five-year term, the employers have freshly welcomed the government’s draft budget for 2020. In a press release released on Friday, the Medef criticized a finance bill that “Risk of stalling the engine of growth”. Even if Bercy touts the billion euros in tax cuts for next year, company representatives have mostly retained the targeted increases hidden behind this overall drop, with cuts in tax loopholes. “The Medef regrets the budgetary choices of the government which gives up reducing its public spending, its debt and supporting competitiveness and employment”, is it written.

Stung, Bruno Le Maire has since strived to chase the idea that fiscal rebalancing in favor of households translates a shift in government policy. “The criticisms of Medef are completely unfounded”, assured Bruno Le Maire before the finance committee of the National Assembly on Friday. “This government has developed a supply policy for two years and will continue to develop a supply policy”, added the Minister of Economy and Finance. As proof, argues the latter, the fact that the executive has sanctified the research tax credit (CIR) that some in the majority wanted to cut. But the tenant of Bercy must feel that these arguments will perhaps not be sufficient, and should plead in mid-October for a reduction in production taxes, long demanded by the employers.

Respond to critics

On the defensive, the government is also seeking to respond to criticism of its action on public spending, the objective of which has been revised downwards (-2.4 points of GDP over the entire five-year period, against -3 points initially planned) . “I invite all parliamentarians from both the majority and the opposition to engage in a simple exercise: identify the sectors of public spending that we are prepared to structurally reduce”, launched the Minister of the Economy, with avenues that could be implemented in the finance bill for 2021.

In the same way, Gérald Darmanin, the Minister of Public Accounts, sought to put into perspective the government retreat on the reductions of posts in the workforce of the State (-10,500 over the five-year term against -50,000 initially targeted). His argument? To arrive at its figure of -10,500, the executive foresees 17,000 job creations in 5 years and 27,000 reductions, i.e. a figure “Only” twice below the target of 50,000. Until now, the government had always reasoned in net deletions.

In detail, the executive plans 10,000 job cuts over the five-year term in the customs administration, 5,700 for the environmental transition administrations, 5,100 for the ministries of labor and health and finally 1,300 in the Ministry of the Economy . Conversely, the Ministry of the Interior will be given 7,500 additional posts, against 6,000 more in the Justice and 1,900 in the Armies. For National Education, the balance should be zero.