2024-11-04 07:38:00
The Minister of Economy and Finance, Antoine Armand, wishes “ mitigate » the increase in employer contributions on low wages planned in the 2025 budget. The government hears the concerns expressed by businesses and the EPR group (Together for the Republic, Editor’s note) in particular, concerning the potential impact on employment » of the five billion euros of planned reductions in charges, he declared on Sunday to the Echos.
« I would like us to improve our proposal by starting by reducing the increase in contributions on low wages. Other efforts will have to be found ”, which can “ take several forms, notably an increase in working hours – which remains insufficient in France », Estimates the minister.
The abandonment of a second public holiday is one avenue among others ”, according to him.
As a reminder, the draft budget for 2025 plans to limit and distribute differently the reductions in employer contributions, currently highly concentrated at the minimum wage level. And this, with the aim of obtaining new revenue and encouraging employers to increase very low salaries. This new cocktail of reductions would also stop at 3 SMIC, compared to 3.5 SMIC today. A lower limit. But the executive struck a sensitive chord by attacking exemptions from employer contributions, the amount of which has doubled in ten years and is now close to 80 billion euros.
Postpone sanctions on manufacturers
Furthermore, in the budget, there is no question, assured the minister, of “ touch the Dutreil Pact » on business successions, nor “ what made the research tax credit successful ».
Antoine Armand, who will participate in the Eurogroup and Ecofin meetings in Brussels on Monday and Tuesday, also says he is in favor of a postponement of the CAFE regulations. The latter imposes sanctions from 2025 on car manufacturers who do not sell enough electric cars. For him, “ manufacturers firmly committed to the electrification of vehicles” should not be affected next year.
« If we have to impose gigantic fines on manufacturers because they have not moved fast enough, the first consequence will be to weaken investment and above all to strengthen our Asian competitors. “, he commented.
Most European manufacturers have asked Brussels for urgent aid measures to face the tightening of CO2 emissions standards in 2025. In fact, they consider themselves incapable of respecting them, in particular because of the erosion of sales of electric cars.
Relax the CSRD directive
Antoine Armand will also discuss the CSRD directive on extra-financial corporate reporting in Berlin on Friday with his German counterparts. Coming into force in France in December, this new European directive aims to give credibility to the environmental, societal and governance (ESG) data published by companies.
In addition to data on the impact on the environment and society, the CSRD requires the presentation of a climate transition plan describing the risks weighing on the company, such as exposure to forest fires or rising water levels. , and which explains how the company plans to adapt taking into account the objectives of the Paris Agreement to limit warming to 1.5°C.
“Without calling into question the objective » of the circular, the minister nevertheless calls for “ a little European common sense ”, estimating that “ the number of companies concerned and mandatory indicators is not reasonable ».
Deficit slippage
Concerning the slippage of the public deficit, the minister will bring together “ in the coming days » a scientific committee responsible for evaluating Bercy’s economic models. Indeed, the public deficit suffered a heavy slippage in 2024, Antoine Armand having estimated at the end of October that it could finally reach 6.2% in 2024 while the former government predicted 5.1% for this year.
The government wants to reduce it to 5% of GDP by 2025 via a budgetary effort of 60 billion euros, 20 billion of which comes from tax increases and 40 billion from spending reductions. Antoine Armand therefore does not exclude the possibility of new savings “ during the year if necessary » to achieve this.
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**Interview with Antoine Armand, Minister of Economy and Finance**
**Interviewer:** Thank you for joining us today, Minister Armand. Recently, you mentioned the need to *mitigate* the planned increase in employer contributions on low wages in the 2025 budget. What are your main concerns regarding the impact of this increase?
**Antoine Armand:** Thank you for having me. My primary concern is to ensure that we do not inadvertently affect employment levels in our country. The planned increase could put a strain on businesses, particularly those employing low-wage workers. It’s vital that we strike a balance between generating revenue for the government and supporting our economy.
**Interviewer:** You’ve suggested that some adjustments could include *reducing the increase in contributions on low wages* and potentially increasing working hours. Could you elaborate on how you plan to achieve this?
**Antoine Armand:** Certainly. We are exploring various options. One key element is reducing the increase in contributions, which I believe can foster more sustainable employment growth. Regarding working hours, I think there’s an opportunity to expand working hours within reasonable limits, as our current average is indeed insufficient.
**Interviewer:** There’s been talk about possibly abandoning a second public holiday as part of the solution. How do you justify that measure?
**Antoine Armand:** Abandoning a second public holiday is just one of the proposals we’re considering. The underlying idea is to ensure that we can maintain a competitive environment for businesses while also being able to support our workers effectively. We want to navigate these challenges in a way that protects both jobs and our economic framework.
**Interviewer:** Moving on to the automotive sector, you mentioned a postponement of the CAFE regulations, which impose sanctions on manufacturers for failing to sell electric vehicles. Why do you believe this is necessary?
**Antoine Armand:** The pace of electrification in the automotive sector varies, and while we want to encourage progress, we must also ensure that our manufacturers remain viable. Imposing harsh penalties too quickly could stifle investment and inadvertently benefit our competitors abroad. We want to support our manufacturers in this transition rather than push them to the brink.
**Interviewer:** Lastly, you will be discussing the CSRD directive in Berlin. What are your hopes for this conversation regarding corporate reporting on environmental, social, and governance issues?
**Antoine Armand:** The CSRD directive is critically important for ensuring transparency and accountability in businesses. However, we must approach it pragmatically. I aim to discuss possible relaxations that can help companies adapt without overwhelming them with stringent requirements too quickly. Our goal is to foster a climate where businesses can thrive while also addressing their societal responsibilities.
**Interviewer:** Thank you for your insights, Minister Armand. We appreciate your time and look forward to seeing how these initiatives unfold.
**Antoine Armand:** Thank you for having me. It’s essential to keep these discussions ongoing for the benefit of our economy and society as a whole.
