France to slash 4,500 public-sector jobs next year

The French government is to scrap 4,500 public-sector jobs in 2019 and more than 10,000 in 2020, Prime Minister Edouard Philippe said in an interview published Sunday. And pensions, family allowance and housing benefit will not keep up with inflation as part of an economy drive to reach EU targets on the budget deficit as growth proves more sluggish than expected.

French President Emmanuel Macron and Prime Minister Edouard Philippe earlier this year
French President Emmanuel Macron and Prime Minister Edouard Philippe earlier this year PHILIPPE WOJAZER / POOL / AFP

Following the loss of 1,600 public-sector jobs this year, about 4,500 will be done away with next year and at least 10,000 the year after that, Philippe told the Journal du Dimanche newspaper.

During last year's election campaign, President Emmanuel Macron pledged to slash 120,000 public-service jobs during his term of office, 50,000 from central government.

The rate will speed up, Philippe said, as digitalisation improves efficiency and other savings are made.

Growth forecast lowered

The prime minister insisted that the government is sticking to its commitment to reduce the budget deficit to 2.3 percent of GDP this year, despite the fact that it now forecasts 1.7 percent growth instead of the 1.9 percent it was previously counting on.

That will "inevitably have an effect", Philippe conceded, since tax revenues will be lower than hoped.

The equivalent of one point of GDP will also be lost because of tax breaks to employers.

Pensions, family allowance, housing benefit

So there will be other savings to be made.

Philippe announced that retirement pensions, family allowance and housing benefit will only go up 0.3 percent a year in 2019 and 2020, substantially lower than the rate of inflation.

But he promised to raise some other state benefits, such as top-ups for the low-paid and disability allowance.

The government's strategy prioritises rewarding economic activity over state handouts, he repeated.

For that reason it is sticking to its plan to stop social security deductions from overtime pay.

One idea the government has dropped, or at least postponed, is forcing employers to contribute to sick pay for short absences.

Bosses' groups argued that the measure would hurt productivity, so Philippe says there will be no "abrupt" change in the system.

But "we have to find a solution to limit this expenditure", he warned, expressing shock that the number of days per employee had risen from 11 to 12 in three years.

"That's as if our country had introduced an extra day of holiday," he told the paper.

Drop in polls

The Journal du Dimanche also reported that both Philippe and Macron have slid further down the opinion polls over the summer.

Only 34 percent of respondents are satisfied with the president's performance today, compared to 39 percent in July and 64 percent in June last year, an Ifop poll showed.

Philippe had a 40 percent satisfaction rating, compared to 41 percent in July and 64 percent in June 2017.

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