The High Council of Public Finances (HCFP) ruled on Wednesday that the growth forecasts that the government would send to Brussels as part of the stability program are "
plausible
" for 2021 and 2022 but "
optimistic
" for the following years.
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In its opinion, the High Council “
considers that the growth forecast for 2021 of the stability program is consistent with the health scenario adopted, based on a gradual lifting from May 2021 of restrictions on activities and travel.
"
The scenario remains marred by uncertainties linked to the evolution of the health situation
," warns the document from this body independent of the government and attached to the Court of Auditors.
For 2021 as for 2022, the HCFP considers “
plausible
”, the assumptions of “
potential growth and output gap adopted by the government
”, the output gap being the difference between the level of activity observed and that which the country should have had it without the Covid-19 crisis.
But he believes that the hypothesis "
according to which potential growth would return to its pre-crisis level from 2023 is optimistic
".
Scenarios including "
significant hazards
"
In its document sent to the HCFP, the government expects growth of 4% in 2022 (after + 5% in 2021), then 2.3% in 2023, 1.5% in 2024, before stabilizing at 1.4% per year from 2025. The High Council notes that the government is counting on a "
closing of the output gap
" in 2024, the gross domestic product (GDP) observed then returning to the level it would have had without the shock of crisis.
He considers that there are "
significant risks
" in this scenario of the stability program, because "
the effective growth path could be slowed down by the rise in interest rates and weaker support for foreign trade
".
"
Conversely, it could be supported by the mobilization of savings accumulated during the health crisis
", still according to the opinion.
The High Council also notes that the stability program “
relies on a gradual rise in inflation, which is uncertain in view of the activity scenario.
As for the public debt, the government's trajectory, which assumes that it peaks at 118.3% in 2025, assumes, according to the HCFP, that growth and inflation are there and that the government actually initiates reforms. structures suspended due to the health crisis.
The public finance programming law "
made obsolete
"
He also estimated that the structural deficits of the public accounts did not deviate "
significantly
" in 2019 and 2020 from the objectives defined in the public finance programming law of 2018. Consequently, this independent body decided that there was “
no need to trigger the correction mechanism provided for
” by this organic law.
The structural deficits, which do not take into account the expenditure incurred or the decrease in revenue due to the health crisis, were estimated by the government at 2.3 points of gross domestic product (GDP) for 2019 and 0.9 points of GDP for 2020, against respectively 1.9 and 1.6 percentage points of GDP provided for by the organic law of 2018.
More generally, the HCFP considers that the necessary changes in public finances due to the Covid-19 crisis have "
made the programming law in force obsolete
".
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The High Council nevertheless criticizes the government for the "
methods of calculating exceptional and temporary measures
" that it has adopted and which lead it "
to show an improvement in the structural balance in 2020, in contradiction with the very sharp deterioration that is expected. persistent public finances
”.
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