PARIS (Reuters) - French Prime Minister Manuel Valls on Sunday slapped down rebels of his ruling Socialist party, branding their calls to support the low paid instead of reducing tax for business irresponsible and saying a change of course was out of the question.
The French government wants to cut the deficit and reduce the tax burden on companies by making 50 billion euros ($67 billion) of savings on public sector costs.
“Yes the policy that the President of the Republic has put in place will take time to produce results,” he said in an newspaper interview after last week’s news that economic growth in France was zero for the second quarter in a row.
“But a change is out of the question,” he told the Journal de Dimanche.
Valls criticized “those on the left who have made irresponsible propositions” and said the policy of reducing the tax burden on companies and paying for it with public sector cost savings was going to work.
“The responsibility pact and its 41 billion (euros) worth of cuts in employer costs are going to take full effect now,” he said.
“If we do not help businesses to be competitive the country will not recover”, he said, repeating his recent mantra about “telling the truth” to the people of a country “living beyond its means”.
Valls’ interview coincided with a JDD-Ifop opinion poll showing more than eight out of 10 French voters had no confidence in a government that is presiding over record unemployment as well as stalled growth.
It also followed news that Valls will address the Medef main employers group’s annual summer conference on Wednesday next week, a further message of defiance to the rebels, who will hold their own conference on Saturday as part of the Socialist Party’s own summer get together.
Last week, leading lawmakers on the left of the party, Emmanuel Maurel, Jerome Guedj and Marie-Noelle Lienemann, demanded the immediate suspension of the responsibility pact and the implementation of “real tax reforms” favoring the poorest the most.
The government has a single-figure majority in parliament but it gets support of Greens and other centrist parties for much of its legislation and the leftists have yet to muster a rebellion of more than 40.
While sending a tough message about the need for belt-tightening at home, the French government has told its European partners it cannot go any further than it is already planning to with austerity, and is softening then up for another year in which it overshoots its public deficit targets in 2015.
After last week’s GDP figures, Finance Minister Michel Sapin cut official growth forecasts for this year and next and raised the forecast 2014 deficit to above 4 percent of GDP from 3.8 previously, calling at the same time for a more growth-orientated policy that relaxes the EU rule demanding members keep their deficits below 3 percent of GDP.
(1 US dollar = 0.7464 euro)
Reporting by Andrew Callus; Editing by Stephen Powell