French budget deficit widens

France's budget deficit widened to €51.71 billion at the end of September from €42

France's budget deficit widened to €51.71 billion at the end of September from €42.01 billion the year before, data showed today.

The finance ministry said spending came in at €196.49 billion in September, up from €192.53 billion a year ago. Receipts rose to €168.65 billion, compared to €167.34 billion at the same time in 2006.

The ministry said the deterioration partially reflected the absence of the significant privatisation receipts that passed through the government's coffers in 2006.

Analysts said the figures showed President Nicolas Sarkozy's government had little fiscal room for manoeuvre at a time when striking fishermen and protesting public sector workers were calling on the government to spend more, not less.

READ MORE

The government's 2007 and 2008 budgets are both based on a growth assumptions of 2-2.5 per cent, more optimistic than the expectations of many economists and institutions.

Even with those forecasts, the 2008 budget achieves only a modest cut of the deficit to 2.3 per cent of GDP next year from an expected 2.4 per cent in 2007.