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JOHN LICHFIELD

OPINION: France has been in denial for decades about its ‘magic money tree’

With the announcement of an 'explosion' in France's budget deficit, significant cuts to French state spending are inevitable - writes John Lichfield - but don't expect them to pass without howls of protest.

OPINION: France has been in denial for decades about its 'magic money tree'
Will France finally have to start reining in spending? Photo: AFP

I left hospital recently after having a new right hip fitted (all seems to be going fine so far, thank you).

When I was due to leave the recovery clinic in Caen, the doctor offered to sign a prescription for a free ambulance or taxi back to my home in the Norman hills 35 kilometres away.

That’s very kind of you (or rather the French state), I said, but my wife is willing to collect me in our car. The doctor seemed surprised, even disappointed. If he was offering free transport on behalf of the French state, why should I make my wife drive 70 kilometres?

I note, therefore, with interest that one of the biggest percentage increases in spending in the French health service in recent years has been for “le transport médical des patients”.

It now costs the French state €5.7 billion a year, or €15.6 million a day, to take people to and from medical appointments or hospital visits. The bill has increased by 50 percent in a decade.

Please note, we are not talking about emergency ambulances. We are talking about a separate service, available on doctor’s prescription, free in many cases, partially paid by patients or their insurance in others, to ferry people to and from treatment or routine tests. It mostly benefits old people or those with long-term illnesses in rural areas but also applies in towns and cities.

READ ALSO How to claim free transport to medical appointments

It was announced on Tuesday that the French state deficit had exploded last year to 5.5 percent of GDP, rather than the predicted and promised 4.9 percent. The cause was not increased spending but a collapse in tax revenues in the last quarter of 2023 when the French economy – buoyant earlier in the year – was dragged down by the problems of China, Germany and elsewhere.

This is a serious problem – yet another – for President Emmanuel Macron who has promised a) no increase in taxes b) big new investment in schools, health and defence and c) to bring the French budget deficit within Eurozone limit of 3 percent of GDP by 2027.

All those things can now only be delivered by a big cut in other forms of state spending. Otherwise, the French deficit will swell to 5.7 percent of GDP this year and 5.9 percent in 2025.

If nothing is done, or not enough, the international ratings agencies, due to make provisional reports in April and May, will downgrade France’s s AA debt status. This could significantly increase the €55 billion yearly cost of servicing the country’s accumulated €3 trillion debt (110.6 percent of GDP).

The French state now takes in taxes 43.5 percent of GDP and spends the equivalent of 57.3 percent of GDP.  No French government has balanced its books for precisely half a century. France has the worst deficit and debt record of any EU country, save Italy and Greece.

Without significant and painful corrective action, starting this year, France is heading for a humiliating debt crisis.

Whose fault is all this?

Everyone’s.

President Emmanuel Macron believes that growth should deal with deficits. He has never invested much personal or political capital in debt reduction. He wants to keep down taxes and to spend lots of money on his strategic aims – from education to defence to industrial revival.

He has presided over two explosions of “all-that-it-takes” public spending in the last four years. The first kept the economy alive during the Covid shutdowns of 2020-1. The second cushioned the shock to consumers and businesses of energy inflation after the Russian invasion of Ukraine in 2022.

Although those probably justifiable splurges are now over, increased debt and service charges and remaining commitments have left state spending €120 billion higher.

But it’s not just the fault of Emmanuel Macron. The whole French political class has been in debt and deficit denial for half a century.

In power, the centre-left has often been more fiscally responsible than the centre-right. But the radical left-wing opposition now proposes increased taxation of the rich and “the bosses” as the sole and obvious solution. Fact: France already takes more in taxes than any other EU state except Denmark.

The centre-right opposition, energetic deficit-builders when they were in power in the 90’s and the “noughties”, sanctimoniously blame the “incompetence” of Macron. Fact: the centre-right refuses to support government initiatives to restrain spending such as pension reform.

Marine Le Pen mocks Macron as the discredited “Mozart of finance”, who has built a €900 billion “wall” of new debt. Fact: she wants to make pensions and other forms of welfare more generous. Her only suggested spending cuts are to suspend welfare payments to “immigrants”.

The French people are also part of the problem (viz. my anecdote on medical transport). Many of them take a teenage, or Gilet Jaune, view of politics: the government should pay more but taxes should be lower (except for the rich and les patrons).

Bruno Le Maire, the long-serving finance minister, published a book recently calling for the finances of the French state – and especially the welfare state – to be torn down and reconstructed. Good luck with that, Bruno, as a manifesto for your presidential election campaign in 2027.

In the meantime, more modestly, Le Maire has already cut €10 billion from the 2024 budget and he is looking for ways of cutting another €10 billion this year and €50 billion over the next three years.

One of his targets is, guess what, “le transport médical des patients”.

In an interview with Le Monde this month, Le Maire said he believed in a “strong state” but not a “pompe à fric”. (Translation: bottomless money pit or magic money tree).

“Is it possible,” he asked. “To continue to spend €5.7 billion a year on moving patients around?”

Spending so much money on “secondary” considerations , he said, prevented proper investment in “priorities” such as hospitals or schools.

Other possible savings from the fringes of France’s €849 billion welfare budget (one third of national income) are being considered. I would also recommend that the French state dismantled parts of itself, such as the préfectures and sub-préfectures, scattered around France as ceremonial or bureaucratic outposts of Paris rule. No other country has anything like them.

But “medical transport” is as good a symbol as any of the generosity or wastefulness of the French state. Modest attempts to reduce the cost – a €4 contribution per journey introduced this year – have already produced howls of outrage.

Moving patients around is the life blood (or pompe à fric) of 5,000 rural taxi companies. Any attempt significantly to reduce the nation’s taxi bill will be hysterically pilloried as an attack on a) the heath service b) old people and c) rural France.

And so it goes on.

I would like, in the circumstances, to thank Bruno Le Maire and the impoverished French state for paying most of the cost of my new hip.

Member comments

  1. Such a weird flex. Even if we assume all these numbers from conservatives like Le Maire and Lichfield are accurate – the pompe à fric (is it bottomless pit or life blood?) of the “5000” rural taxi companies happen to pay taxes such that the “€5.7 billion” per year contributes back to tax revenue and is more like €3.42 billion, or roughly €0.14 per person per day.

    Maybe if these conservatives really cared bout the deficit they would voluntarily pay the full cost of their own hip replacements. In the mean time, you are welcome.

  2. You can bring the progressive politics-hating English curmudgeon to France, but you can’t make the progressive politics-hating English curmudgeon French. He’s probably smugly proud of this obtuseness….

    So what’d you pay for that new right hip, eh? Why not propose to cut funding for that?

    His columns are such bosh….

  3. I agree with you about the daftnest of ‘transports medicaux.’ However, it seems to me that problems arise from the lack of car parking space. My husband sees a neurologist at CHU Angers. There is very limited parking for patients, and it isn’t close to the neurology department. CHU Angers encourage outpatients to use public transport, but the CHU serves (excellently) a very large area, so public transport isn’t a reasonable option from where we live. For his next visit, bon pour transport.

  4. This article is spot on. I see examples like this a lot. Contrary to some others I don’t see any hypocrasy in this article at all.

  5. Re the small world view of some of the comments above. Running any kind of Budget deficit means ultimately that the Govt has to print money (mostly ‘electronically’ that is, rather than physically). Printing money means that any money that YOU have is worth less.

  6. I have macular degeneration in one of my eyes. I cannot attend for treatment alone, as I am unable to see afterwards. So far, my wife has been my taxi for a long journey. Now my ophthalmalogue is changing her treatment days, so my wife, herself a doctor, cannot always help. So I need a taxi. This is a lifetime condition, and some help with the journeys makes sense. BTW, John is an excellent political commentator.

  7. No “hypocrasy”? Notice that Litchfield didn’t even have the journalistic objectivity to even MENTION the surely cheap costs of the major outlay – his surgery. The guy takes gladly from the big pile and then complains about the tiny pile.

    If his wife wasn’t there I’m sure he would have hobbled home rather than accept a free trip! Ha, surely not!

    I’ll be glad when Litchfield retires – his English rejection of solidarity is cliche and reactionary.

  8. This tacking on of a thank you at the end – how much does he think Bruno Le Maire paid himself? He should be thanking the France people. “Impoverished” as we are – what an exaggeration! – by our apparently delusional beliefs, those beliefs include the need to take care of everyone, including smug immigrants like Mr. Lichfield.

    And our health care system far precedes the unpopular (except to right-wing journalists) Le Maire – seems like misguided, delusional hero worship….

  9. Free medical transport is essential for some patients and unnecessary for others. Many times I drove myself to and from chemotherapy appointments instead of using the free taxi service, but when I needed a small eyelid surgery I was unable to drive and so availed myself of the free taxi ride. The free medical transport simply needs to better targeted to where it is genuinely needed.

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POLITICS

8 things you never knew about Andorra

The tiny statelet nestled in the Pyrenees mountains that mark the border between France and Spain hit the headlines with its new language requirement for residency permits – but what else is there to know about Andorra?

8 things you never knew about Andorra

This week, Andorra passed a law setting a minimum Catalan language requirement for foreign residents

It’s not often the tiny, independent principality in the mountains makes the news – other than, perhaps, when its national football team loses (again) to a rather larger rival in international qualifying competitions.

The national side are due to play Spain in early June, as part of the larger nation’s warm-up for the Euro 2024 tournament in Germany. Here, then, in case you’re watching that match, at Estadio Nuevo Vivero, are a few facts about Andorra that you can astound your fellow football fans with…

Size matters

Small though it is – it has an area of just 468 square kilometres, a little more than half the size of the greater Paris area – there are five smaller states in Europe, 15 smaller countries in the world by area, and 10 smaller by population.

People

Its population in 2023 was 81,588. That’s fewer people than the city of Pau, in southwest France (which is itself the 65th largest town in France, by population).

High-living

The principality’s capital, Andorra la Vella (population c20,000 – about the same population as Dax) is the highest capital city in Europe, at an elevation of 1,023 metres above sea level. 

Spoken words

The official language – and the one you’ll need for a residency permit – is Catalan. But visitors will find Spanish, Portuguese and French are also commonly spoken, and a fair few people will speak some English, too.

Sport

We’ve already mentioned the football. But Andorra’s main claim to sporting fame is as a renowned winter sports venue. With about 350km of ski runs, across 3,100 hectares of mountainous terrain, it boasts the largest ski area in the Pyrenees.

Economic model

Tourism, the mainstay of the economy, accounts for roughly 80 percent of Andorra’s GDP. More than 10 million tourists visit every year.

It also has no sales tax on most items – which is why you’ll often find a queue at the French border as locals pop into the principality to buy things like alcohol, cigarettes and (bizarrely) washing powder, which are significantly cheaper.

Head of state

Andorra has two heads of state, because history. It’s believed the principality was created by Charlemagne (c748 – 814CE), and was ruled by the count of Urgell up to 988CE, when it was handed over to the Roman Catholic Diocese of Urgell. The principality, as we know it today, was formed by a treaty between the bishop of Urgell and the count of Foix in 1278.

Today, the state is jointly ruled by two co-princes: the bishop of Urgell in Catalonia, Spain and … the president of France, who (despite the French aversion to monarchy and nobility) has the title Prince of Andorra, following the transfer of the count of Foix’s claims to the Crown of France and, subsequently, to the head of state of the French Republic. 

Military, of sorts

Andorra does have a small, mostly ceremonial army. But all able-bodied Andorran men aged between 21 and 60 are obliged to respond to emergency situations, including natural disasters.

Legally, a rifle should be kept and maintained in every Andorran household – though the same law also states that the police will supply a firearm if one is required.

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