Brussels, 19/11/2015 (Agence Europe) - The French government has put at €600 million the additional expenditure for 2016 to tighten up security, following the terrorist attacks carried out late last week.
The mobilisation of fresh resources will lead to “additional expenditure on the state budget in the order of €600 million in 2016”, which will pay for the creation of new jobs in the police and gendarmerie and equipment requirements, the French finance minister, Michel Sapin, told a debate at the French Senate on the draft finance law 2016, Reuters reports. “We assume, at this stage of the budgetary discussion, a worsening of the public deficit”, he added. The secretary of state for the budget, Christian Eckert, said that this expenditure would not be paid for “any further caps on the ministries or through taxation”.
On Monday, the French president, François Hollande, announced a security pact to include the creation of an additional 5,000 posts in the police and gendarmerie in 2016 and 2017, another 2,500 posts in the justice system, another 1,000 posts in customs and a stabilisation of army personnel levels up to 2019.
This expenditure, which has still to be finalised, will increase the French public deficit to the tune of 0.03% of GDP, although Paris has committed to reduce its excessive nominal deficit (above the threshold of 3% of GDP) by 2017 in accordance with the following trajectory: 3.8% in 2015, 3.3% in 2016 and 2.7% in 2017.
Flexibility of the Stability Pact. In Paris on Thursday, the commissioner for economic and financial affairs, Pierre Moscovici, said that it was “too early to speculate now on how these additional costs will impact on France's budgetary trajectory”, in his introductory speech published on his webpage. He said that there was no reason to believe that this trajectory would change “spectacularly”. He sees no conflict between security issues and healthy public finances, “between the security pact (…) and the stability pact, which is our common rule”.
His words were echoed by the president of the European Commission, Jean-Claude Juncker. The additional resources announced should not be seen as ordinary expenditure with regard to the pact, he said in Brussels at a citizens' debate on Europe.
On Tuesday, when presenting its opinions on the draft 2016 budgets of the countries of the eurozone (see EUROPE 11432), the European Commission said that the French draft, which is based on figures available one month ago, was “globally compliant” with the stability and growth pact. (Original version in French by Mathieu Bion and Camille-Cerise Gessant)