public finances, candidate programs under control

“Today is Christmas every day, with gift vouchers for everyone» : Jean-François Husson, Senator LR of Meurthe-et-Moselle and General Rapporteur of the Finance Committee, does not take off. For months, this guarantor of budgetary orthodoxy has warned of the dangerous drift of public finances. Two weeks before the presidential election, the campaign would look more like a Lépine competition for tax cuts and new spending than an exercise in restoring public finances.

→ ANALYSIS. Presidential 2022: officials, paradigm shift

A debt of 3 billion euros

At the end of the five-year period, however, they are in a disastrous state: in 2021, the public deficit stood at 6.5% of GDP, and public debt flirted with 2.8 billion euros (an increase of 700 billion in five years). . In question, the increase in spending linked to the health crisis, but also the reduction of 50 billion euros in taxes throughout the five-year period. Concerned, the Court of Auditors estimated in January that an additional € 9 billion in savings would have to be achieved each year to reach the target of a 3% deficit by 2027.

The ace. The war in Ukraine has once again overshadowed the messages, which has led the government to take new emergency measures, with an air of “whatever it takes.” In this context, it is difficult to position oneself on anything other than short-term measures. In recent weeks, candidates have also multiplied their proposals in favor of purchasing power, accusing the executive of not going far enough, or contrary to “burn cash register”.“In any case, we cannot say that public finances are absent from the campaign. It is the credibility of the figures that leaves much to be desired. “ believes François Ecalle, president of Fipeco, an information site on public finances.

→ SHEET. Presidential 2022: compare candidate programs (immigration, education, family, etc.)

Incredible numbers

Unlike 2017, almost all candidates have made the effort to present balanced programs, equating their new spending with equivalent income or savings: 50 billion euros for Emmanuel Macron and Anne Hidalgo, just over 65 billion for to Marine Le Pen and Eric. Zemmour, 250 billion euros for Jean-Luc Mélenchon or even 42 billion euros for Valérie Pécresse (who plans to save in the same proportions). In doing so, “Valérie Pécresse is the only one who wants to significantly reduce the deficit,” says Victor Poirier, director of publications at the Institut Montaigne.

The return of pensions

The main source of expenditure, pensions, has returned significantly to the political debate, either as a savings fund to be sought, or as a new charge to finance. It is estimated that raising the legal retirement age to 64 or 65 for Emmanuel Macron, Valérie Pécresse and Éric Zemmour would bring in nearly € 10 billion a year by the end of 2027, while returning to the age of 60 for Marine Le Pen. , Jean-Luc. Mélenchon or Fabien Roussel could cost several dozen. Figures to be treated with care.

→ ANALYSIS. Presidential 2022: retirees at the heart of the electoral battle

“Overall, the estimates made by the campaign teams are, as always, very optimistic.” believes François Ecalle. Modernization of the state apparatus, elimination of administrative duplication, or even the fight against tax or social fraud … The programs are full of measures that allow (in theory) to return billions to the coffers. But the proposed figures sometimes leave you wondering. Only on tax evasion, Yannick Jadot, Marine Le Pen and Valérie Pécresse promise between 10,000 and 15 billion euros in revenue, when Jean-Luc Mélenchon hopes to raise 100 … As for the great promise of Valérie Pécresse from abolishing 150,000 civil servants, to contributing 15 billion euros, its viability remains hypothetical.

The risky bet of growth

Much more cautious than in 2017 on this issue, Emmanuel Macron, on the other hand, wants to rely heavily on his ability to save by modernizing and digitizing the administration: 15 billion euros are expected with the implementation of electronic prescribing and Vitale electronic card. Above all, the presidential candidate expects 35 billion euros in less spending thanks to the return to growth and full employment.Our philosophy is very clear: to encourage work to finance our social model “, Val-de-Marne MP LREM Laurent Saint-Martin, his campaign treasurer, is on strike.

But for economists, making growth the alpha and omega of public policy remains a bold bet, especially in this period of geopolitical instability. “Actually, in order to clean up public finances, we would have to make very strong and very unpopular political decisions, which are to drastically reduce our spending on pensions and health care, or to raise taxes en masse.” said Mathieu Plane of the OFCE.

Controversial, they are the only programs of Eric Zemmour, who wants to reduce the social spending of foreigners by 20 billion euros, and Jean-Luc Mélenchon, who expects 150 billion euros of additional tax revenue by taxing the rich. to advocate a real change of direction. On the right, the majority of candidates are moving further towards the tax cut, with the main line of view of production taxes, which weigh on the competitiveness of companies, and inheritance taxes, considered illegitimate.

→ FIND the results of the 2022 presidential election as soon as they are officially published, municipality by municipality

Change of perspective on debt

Beyond these differences of vision, it is certain that the health crisis, and its billions dumped on the economy, has changed the view of the sustainability of public debt. Most candidates are also in favor of a relaxation of the rules of the European Stability Pact, which requires states not to exceed 3% of the public deficit. Taking the lead, environmentalist Yannick Jadot even presented a poor track record “excluding green spending.”

“With the war in Ukraine, which has led states to agree on the need to invest in their energy and military independence, supporters of greater budgetary flexibility have also found arguments.” emphasizes economist Eric Chaney.

→ SHEET. Presidential 2022: compare candidate programs (immigration, education, family, etc.)

Except that the plot of the war is twofold. As long as interest rates are lower than the growth rate, we can say that debt is not a priority. But if rates go up, states will be forced to take control of their deficits. “ says Patrick Artus, research director at Natixis. With galloping inflation, the scenario is increasingly likely, and there is a risk of undermining the big election promises.

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