France will need cutbacks to offset some €11 billion in extra costs in debt service, welfare and other areas in 2005 to keep to its EU budget commitments, Budget Minister Mr Dominique Bussereau said today.
His comments in a newspaper interview reinforced the view that ministries will have to tighten the belt in an austerity budget for 2005 as France strived to cut its public deficit back below the EU's limit of 3 per cent of gross domestic product.
"We want to prepare a budget that respects our European commitments," Mr Bussereau told Le Monde, referring to the 2005 budget bill that is due to be presented in September.
"The measures already announced, developments in the cost of debt, salaries, minimum welfare benefits, are estimated at €11 billion. Substantial savings are therefore necessary if we want to achieve our objective," he said.
France is set to breach the EU's deficit limit for the third time running this year, but Prime Minister Mr Jean-Pierre Raffarin has pledged to cut it below the ceiling in 2005.
"All ministries will have to make an effort," Mr Bussereau said. "Everyone is starting to understand that you can't present a budget that is in deficit every year."