François Bayrou’s Concessions to the PS: Surtaxes, Waiting Days, and Medications to Avoid Censure

François Bayrou has proposed budgetary concessions to socialist deputies, including canceling new waiting days for civil servants and maintaining the high-income tax, in exchange for the Socialist Party’s decision against a censure motion. Bayrou’s taxation plans aim to raise 21 billion euros in revenue for 2025 and include measures like a differential contribution on high incomes and an expanded zero-interest loan program for housing. A “conclave” on pension reform is also planned, emphasizing the need for parliamentary involvement.

François Bayrou’s Budgetary Concessions

In a significant development, François Bayrou outlined a series of budgetary concessions to socialist deputies in a letter released on Thursday. These concessions include the cancellation of new waiting days for civil servants, the retention of the high-income tax, and the abandonment of proposed job cuts in the education sector. In exchange, the socialist party has agreed not to support a censure motion, as confirmed by a participant in the PS national office just prior to the motion’s examination.

The Prime Minister’s letter, which comes after ten days of intense negotiations, was addressed to the leaders of the PS groups in the Assembly and the Senate, Boris Vallaud and Patrick Kanner. This communication was made just an hour before the Assembly began discussing the censure motion introduced by LFI.

Taxation and Housing Initiatives

On the taxation front, Bayrou has affirmed the continuation of the new differential contribution on high incomes, which is projected to generate 2 billion euros. This tax is expected to be replaced by a more permanent solution by 2026 aimed at combating tax optimization. Additionally, the temporary surtax on large corporations will remain, anticipated to yield around 8 billion euros. Other measures include an increase in taxation on share buybacks and a slight rise in financial transaction taxes.

In the housing sector, Bayrou has committed to expanding the zero-interest loan program nationwide for new housing projects. He has also indicated support for a modest increase in notary fees, which will be managed by local departments. Overall, Bayrou has projected an increase in government revenue of 21 billion euros for 2025 compared to 2024, while aiming for 32 billion euros in savings to reduce the public deficit to 5.4% of GDP by 2025.

Alongside these budgetary commitments, Bayrou announced plans for a “conclave” involving social partners to address pension reform. This initiative is set to commence with a meeting scheduled at Matignon, with hopes that it will lead to new legislation. The Socialist Party has emphasized the need for parliamentary involvement even if social negotiations do not yield expected results, indicating that they remain cautious about granting full trust to the government.

In response to the motion of censure, various political factions are positioning themselves strategically. While some groups, including the National Rally, have opted not to support the censure, others, such as the Insoumis, have expressed dissatisfaction with the Socialist Party’s approach. The upcoming budgetary discussions remain crucial as the government aims to finalize its budget by the end of February to ensure a smooth transition into the new fiscal year.

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