President François Hollande marked the first anniversary of his election by holding a four-hour government seminar in the greenhouse at the Élysée yesterday, followed by a working lunch with his 35-member cabinet.
“What we have done in one year is substantial,” Mr Hollande said in a pep talk to his ministers, “and what remains to be done is considerable.”
The French leader recalled that the previous conservative government increased France’s debt by €600 billion and now wants to preach to the socialists in power.
“I know of no government in the world that, by raising taxes, has seen affection rise irrepressibly towards it,” Mr Hollande continued. He levied an additional €20 billion in taxes last year, but also promised €20 billion in tax credits for business over three years.
The European Commission has questioned how France will finance the tax credits. The commission gave France a two-year delay to bring its public deficit under 3 per cent of GDP. Because Mr Hollande can raise taxes no further, he will have to cut government spending, in particular pensions and family allowances.
Invented propaganda
After the "left of the left" demonstrated against austerity on Sunday, prime minister Jean-Marc Ayrault told TF1 television: "There is no austerity [in France]. That is invented propaganda. I want to save the republican French social model."
Mr Hollande said the euro zone was on the verge of collapse when he came to power, the banking system was “out of control” and Europe was threatened by “unlimited austerity”. France had played an important role in the preservation of the euro, the creation of a banking union, progress towards a tax on financial transactions and promoting the return to growth.
He had “responded with sincerity” to the expectations of French citizens, by allowing people who began work very young to retire early, increasing the minimum wage, hiring more teachers, increasing children’s school allowance and controlling rent.
Mr Hollande said his government has “laid foundations” by showing seriousness in meeting its budget targets, creating a “pact of competitiveness” to encourage French entrepreneurs and reforming the labour market. He wants his government to “accelerate” and “be on the offensive”.
He repeatedly acknowledged his compatriots’ low morale. “I understand the scepticism of the French,” he said. “For years they’ve been asked to make so many sacrifices, by so many governments, without results . . .
“The main question that torments the French is whether our country can hold its rank, its place, its level in global competition and if they themselves can succeed.”
