France to trim benefits for jobless as debt pressure mounts

PRIME Minister Gabriel Attal unveiled a plan to cut French unemployment benefits in a bid to advance President Emmanuel Macron’s economic reforms.

The overhaul would pare the maximum duration of welfare to 15 months from 18 and lengthen the period of work required to qualify for benefits, Attal said in an interview in the Sunday (May 26) edition of La Tribune newspaper. The government wants the changes to take effect from Dec 1. 

The changes aren’t a cost savings measure, but are aimed at getting more French people into the workforce to finance the benefits system, Attal said. 

The measures come after France received a warning about its high debt burden from the International Monetary Fund, which called for more efforts to get budget deficits under control. The country’s fiscal watchdog has said plans to do so lack credibility and coherence.

French Finance Minister Bruno Le Maire has said the government will do “everything necessary” to meet its pledge to bring the budget deficit within the European Union’s limit of 3 per cent of gross domestic product in 2027.

In two weeks, France is voting in European Parliament elections that polls suggest the far-right National Rally party of Marine Le Pen will win by a large margin. She has been a vocal critic of Macron’s labour reforms, which she says penalise workers. BLOOMBERG