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Investing.com -- The French government will need to make an additional €5 billion ($5.9 billion) in spending cuts to reach its 2025 budget deficit target of 5.4% of GDP, the Finance Ministry announced Thursday.
In a mid-year update on public finances, the ministry stated that while tax income is currently in line with expectations, there are cost overruns in several areas. Spending by some ministries, the health system, and municipalities is running slightly over budget.
"The diagnosis is clear, and so are the decisions: meeting the public deficit target of 5.4% of GDP in 2025 remains achievable, but subject to an additional effort of 5 billion euros on spending," the ministry said in a statement.
These new cuts come on top of €5 billion already frozen earlier this year, according to a ministry source.
The government is preparing more significant budget measures beyond these immediate cuts. With opposition parties looking for opportunities to issue a no-confidence vote, Bayrou is planning to outline €40 billion in new spending cuts for next year’s budget in the coming weeks.
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