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France must tackle unemployment benefit reform

Staff writer |
France must not shy away from further reforms of its costly unemployment benefit system, its economy minister said in a newspaper interview.

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"There should be no taboo... The social benefits system has a 4 billion euros deficit, what politician could be satisfied with this. There was a reform, but it is not enough," Emmanuel Macron told Sunday's Journal du Dimanche.

France's socialist Prime Minister Manuel Valls sparked an outcry on the left last week when he suggested more needed to be done to encourage the unemployed back into work.

"It's up to unions to get things done. But as the government funds the system, it can also take control of the situation if there are deadlocks in negotiations," he said, adding the topic would not go away.

On Wednesday, France submits to the European Commission a 2015 budget that sees the public deficit falling from 4.4 percent of output this year to 4.3 percent, only falling below the EU-mandated threshold of 3 percent in 2017.

France had previously promised EU partners it would bring its deficit back into line by next year, having already won an extension from 2013. France's spending watchdog doubts the new targets can be met.

France's unemployment rate is stuck above 10 percent despite billions of euros spent on subsidised jobs and the country is under pressure to show it can implement reform.

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