French citizens who drive to work will be eligible for a new 2023 direct transfer scheme amounting to €100, announced Prime Minister Elizabeth Borne, adding that it will only be granted to those earning under a specific salary.
It is necessary to “target those who most need it most,” Prime Minister Elisabeth Borne told French radio RTL on Wednesday.
Both the government and energy provider TotalEnergy had stepped in over the summer to subsidise fuel prices at 30 cents per litre. This support scheme had recently gone down to 10 cents and is due to wind down altogether at the end of 2022.
“We continue to support the purchasing power of working French people” whose dependence on cars to go to work weighs down on their finances, government spokesman Olivier Véran said.
This new measure comes amid continuously high inflationary pressures, up 6.2% in November 2022 year-on-year.
As such, it will do little to tame fuel prices, which remain far above pre-crisis levels. Diesel stood at €1.82 per litre on Tuesday, a long way from its €2.24 per litre peak in March 2022, but a far cry from the €1.5 the French were used to before the Russian war in Ukraine.
Left-wing opposition quickly highlighted that an increase in wages would have a much more positive and all-encompassing impact on purchasing power. “The government is just avoiding the real conversation,” socialist parliamentary whip Boris Vallaud told France Inter.
A study by the government body Dares found that nominal wages had increased by 3.7% across the board since the beginning of the year. However, the figure fell to -2% once inflation was accounted for.
A consumer rights body also urged the government to move away from a salary-based scheme to one that looks at “actual car usage,” and avoids what could lead to “extreme injustice.”
As for the extreme right, they have made it clear they could not support such a proposal. Rassemblement National’s whip Marine Le Pen always advocated for a VAT cut on fuel from 20% to 5.5% even since she ran for office earlier this year.
The measure is “yet another mistake: it creates inflationary pressures and targets a minority,” extreme-right Jean-Philippe Tanguy MP told EURACTIV France.
This is not the first time fuel prices have made headlines in France. Back in October, when incentive schemes had first been implemented, EURACTIV reported there were risks of fuel supply shortages after drivers were rushing to fill up their cars.
(Théo Bourgery-Gonse | EURACTIV.fr)
Source: euractiv.com
