In crunch French government talks it was announced Mr Macron has no plans to reduce the structural deficit next year in a revised budget designed to comb through the leader’s plans to offer pay rises to the poor and benefits to retired French citizens. The move has been blasted for putting further pressure on the European Commission – despite Mr Macron himself lecturing debt-ridden Italy and Greece on their breaching of the bloc’s fiscal rules. France was required to reduce its structural deficit by 0.6 percentage points next year and had initially targeted a 0.1 percent cut this year and a 0.3 percent reduction in 2019. But the revised deficit is now envisaging no cut at all, the French government source said. EU rules usually allow for a deviation of 0.5 percentage points from fiscal targets at most.
Today, French Finance Minister Bruno Le Maire met EU economic commissioners Valdis Dombrovskis and Pierre Moscovici to discuss the budget.
After the meeting he said he believed Brussels understood Paris arguments to boost spending.
Meanwhile, the Commission decided not to launch disciplinary proceedings against Italy after Rome cut its headline deficit to 2.04 percent of output.
Brussels accepted Italy’s plans not to cut its structural deficit next year, despite a requirement of a 0.6 percent cut.
Italy has a much larger public debt than France at 2.3trillion euros.
The protests, which have now taken place over four consecutive weekends in Paris and swarmed to Brussels and the Netherlands destroying landmarks and seeing cars and buildings set alight, is expected to cripple the French economy by 10billion euros.
Up to three people were killed in the violence too.
France had already said on Sunday that its headline deficit could grow to 3.2 percent of output from 2.8 percent initially planned. EU rules foresee a 3 percent ceiling, although they are flexible.
Brussels is also closely monitoring structural deficits, which exclude one-offs and business cycle effects, and if kept under control prevent public debts from expanding.