France state

French lawmakers set to approve inflation-fighting program

PARIS — The French parliament on Thursday approved a plan to fight inflation that aims to support the purchasing power of citizens and help them cope with soaring consumer prices and energy costs.

The package was split into two invoices. The first, specifically designed to fight inflation with a package of measures amounting to 20 billion euros, or about 20.4 billion dollars, was adopted on Wednesday by both houses of Parliament. The second, an additional spending bill that earmarks 44 billion euros for new spending in 2022, was approved on Thursday after lawmakers from both chambers agreed on a common version.

“It’s a victory for the French, for our fellow citizens who are struggling to make ends meet, who are worried about rising prices,” said Bruno Le Maire, French Minister of Economy, on Thursday. RTL radio. “Thanks to this package of purchasing power, they will be able to cope.”

France, like the rest of Europe, has been hit by the fallout from the war in Ukraine, but not as severely as some of its neighbors – some of whom, like Germany, rely much more on Russian natural gas to make operate their savings.

Inflation in France reached 6.8% in July, lower than in almost all other countries in the euro zone, according to Eurostat. The country, which has a strong tourism industry, also saw growth of 0.5% in the second quarter, beating analysts’ expectations.

Measures include an extension, until the end of the year, of fuel subsidies that reduce the cost of gasoline; a cap on rent increases that expires next June; a 4% increase in pensions and other state-guaranteed social benefits; a slight increase in the salaries of state employees; and a relaxation of the rules governing the size of tax-exempt bonuses that private companies can grant to some of their employees.

The package also fulfills President Emmanuel Macron‘s campaign promise to scrap the TV license fee, creates a one-time cash bonus to be distributed to low-income households in September and gives some private sector employees the chance to cash in their days off. compensation.

Mr. Macron had made the relief plan one of the top priorities of his second term. It was also the first major test of his government’s ability to push through bills in a newly fractured lower house of parliament, where his centrist alliance no longer controls an absolute majority of seats.

Mr Macron’s party and his allies reached compromises with mainstream conservatives, who voted in favor of the package, while left-leaning lawmakers opposed to the president voted against or abstained.

Left-leaning parties criticized the measures as being too timid and too dependent on temporary bonuses instead of permanent wage increases. They advocated for stronger measures, such as freezing the prices of gasoline and basic necessities, raising the minimum wage and creating a tax on the windfall profits of large energy companies, such as the have already done some European countries like Great Britain.

“Faced with rising prices, you gave in,” Adrien Quatennens, a member of the left-wing France Insoumise party, told lawmakers on Wednesday. “You haven’t taken any action that gets to the root of the problem.”

In order to strengthen France’s energy independence, the package also cuts red tape to speed up the installation of a floating liquefied natural gas terminal in Le Havre, a port city in northern France, and affects nearly 10 billion euros to the renationalisation of EDF, the French state-backed electricity giant.