Medef Proposes Ambitious €100 Billion Savings Plan to Slash France’s Public Deficit

The Medef, France's leading employers' organization, has unveiled a comprehensive plan aimed at reducing the country's public deficit by €100 billion by 2030. This ambitious blueprint, comprising around fifty specific measures, could cut the public deficit to 4.2% of GDP by 2027 — a notable improvement over the government's current target of 5% for this year.

Key proposals include an increase in the Value Added Tax (VAT) by 2.3 points, raising the retirement age to 65, and freezing basic pensions. Additionally, the plan calls for significant budgetary cuts targeting civil servants and retirees, reduction of subsidies to associations, and stricter rules on unemployment benefits. To offset some impacts on companies, Medef suggests removing the surtax on large corporate profits and further reducing production taxes.

Economy Minister Roland Lescure expressed cautious support for the proposals during an interview on BFM Business. He acknowledged the value of Medef’s ideas, particularly spending cuts in health expenditure, but also highlighted challenges, noting that implementing a VAT increase amid recent inflationary pressures remains uncertain. Lescure emphasized the importance of collaboration between businesses and the public sector to achieve fiscal objectives.

Medef’s plan reflects a comprehensive approach to address France's public finances by balancing reductions in public spending and adjustments to tax policies, while also proposing reliefs for businesses. The focus on civil servants and retirees underscores the government’s ongoing challenges in reforming public spending.

As of July 3, 2026, the proposals await further discussion and potential adoption, with the economic minister welcoming input from all stakeholders to refine and possibly implement the measures necessary to stabilize France’s economy over the coming decade.