France to cut unemployment benefits ahead of crucial EU elections
Prime Minister of France Gabriel Attal presented a plan to cut unemployment benefits in Sunday's edition of the newspaper "La Tribune." The changes, set to take effect on December 1 of this year, are part of President Macron's economic reforms. The government aims to encourage the French to return to the labour market.
France has taken a rather risky step shortly before the European Parliament elections. According to Prime Minister Attal's announcements, the maximum duration for receiving unemployment benefits will be reduced from 18 to 15 months. At the same time, the required period of work qualifying for benefits will be extended, reports Bloomberg.
As the head of government emphasized in an interview with "La Tribune," the proposed changes are not intended to save money but to increase the number of professionally active French citizens, which will allow the financing of the benefits system.
France has a debt level problem
Plans to restrict unemployment benefits came about when France received a warning from the International Monetary Fund (IMF) regarding high debt levels. The Fund has called on the French government to make more significant efforts to control the budget deficit. The National Fiscal Council also doubts the credibility and coherence of the government's plans in this regard.
However, Finance Minister Bruno Le Maire assured that the government will do "whatever it takes" to meet the promise of reducing the budget deficit below the EU limit of 3 percent of GDP by 2027. As Prime Minister Attal noted in an interview with "La Tribune," the proposed benefit cuts are expected to achieve this goal by activating the French workforce.
Reform in the shadow of the EU elections
In two weeks, France will hold elections for the European Parliament. According to polls, the far-right National Rally of Marine Le Pen, a vocal critic of President Macron's labor market reforms, is expected to win the elections. She believes these changes hit workers hard.
Nevertheless, as Prime Minister Attal emphasized in an interview with "La Tribune," the government is determined to implement the announced reform of the unemployment benefits system. It aims to allow more French people to return to the labor market and reduce the deficit, which aligns with the guidelines of the IMF and the EU.
Although the far right is expected to succeed in the European elections in many EU member states, polls do not indicate a significant shift in the balance of power in the European Parliament itself. The majority should remain with the center-right coalition, along with the Social Democrats and Liberals.
Other governments may face dilemmas related to pre-election decisions. Conservative or far-right parties will make it to the electoral podium in several member countries. According to polls, the far-right will win in France, Italy, Austria, the Netherlands, and Belgium and significantly strengthen in Portugal and Romania. However, parties to the right of the EPP do not form a single group in the EP, and despite their clear supremacy in many countries, they have no chance of a majority in the chamber in Strasbourg.
