The 2025 finance bill provides for an effort of 5 billion euros for communities in order to reduce the public deficit to 5% of GDP.
A year after the threat of suppression weighing on them, the departments are meeting in a congress in Angers from Wednesday against the backdrop of a “budgetary blow”, while a third of them are already in a difficult economic situation. .
The finance bill for 2025, largely rewritten in the National Assembly, provides for an effort of 5 billion euros for communities in order to reduce the public deficit to 5% of GDP. The main mechanism, a “precautionary” fund of 3 billion euros, consists of a levy on the revenues of the 450 largest communities, with the exception of the most fragile.
According to the Départements de France (DF) association, the departments are on the front line with cuts which would be equivalent to 2.2 billion euros, or 44% of the effort requested from communities. “We are being hit in the back of the head with a club. We were truly knocked out on our feet when we learned of this completely incomprehensible effort,” their president François Sauvadet, also UDI president of Côte-d’Or, told AFP.
Scissor effect
If the departments are the stratum of communities most impacted by the government’s draft budget, it is also because their budgets are already victims of a jaws effect.
For three years, they have recorded an explosion in their social spending, rising from 53% to 70% of their budget due to the rise in precariousness (payment of RSA), the increase in spending linked to aging (APA, for people dependent elderly) and disability (PCH), and at the same time see revenues from real estate transactions fall, due to the deep crisis in the sector.
“Last year, we had 14 departments in difficulty, this year we have around thirty and if we apply government levies, 80% of the departments will be in great difficulty,” insists François Sauvadet. In July, the Court of Auditors had already warned about the financial situation of the departments.
During the previous meetings organized in November 2023 in Strasbourg, the departments felt targeted by the idea of the elimination of a stratum of communities formulated by Emmanuel Macron, finally abandoned by former Prime Minister Élisabeth Borne.
“First Shield”
This year, the theme of the Angers conference, “The Departments asphyxiated, all French people impacted”, alone sums up the situation. “The departments lived rather well between 2013 and 2022, with transfer taxes for consideration (DMTO, levied on real estate transactions, editor’s note) which increased on average by 10% per year”, recalls Christian Escallier, general director of the firm Michel Klopfer.
However, these transfer taxes, which represent between 20 and 30% of their revenue, have fallen by 25% in 2023 then by 15% in 2024. “The real issue today for them is to manage to balance their budget for 2025”, adds this local finance specialist, for whom, if nothing changes “several dozen departments will not succeed”.
It is in fact impossible to reduce their expenditure, “to 63% which is barely or not controllable”, nor to increase taxes, the departments no longer levying taxes since 2021. Certain departments could therefore be placed under the supervision of the State, a particularly uncomfortable situation politically for the government.
Difficulties
One of the levers for action could be to temporarily raise the DMTO ceiling rate in order to give them a breath of fresh air. But such a measure would be contradictory with the desire to revive the cycle of real estate transactions which is currently broken down. The other main demand from the departments is the abandonment of the drain on their revenues planned for 2025.
“If we apply the measures proposed by Bercy, the departments will disengage from aid to the rural world of which they are the first shield, stop maintaining their roads, stop aid for sport, aid for culture, aid to municipalities”, warns François Sauvadet, recalling that such measures would not be without consequences on extreme voting in the countryside.
Michel Barnier, himself former president of the general council of Savoie from 1982 to 1999, is expected in Angers on Friday where he could make announcements. Questioned by AFP, the Minister of Partnership with the Territories, Catherine Vautrin indicated that the government was “open to an evolution of the finance bill to better take into consideration the difficulties of certain departments while maintaining the objective of reduction in public spending.
