The French Government is going to compensate the sharp rise in fuel prices with a check for one hundred euros to 38 million French people, more than half of the country’s population, Prime Minister Jean Castex announced on Thursday. As explained, anyone who earns less than 2,000 euros per month can benefit from this “compensation for inflation”, which seeks to appease the growing social discontent due to the continuous rise in prices in a country where another rise in gasoline caused the biggest protest of the mandate of Emmanuel Macron, that of the yellow vests.
“We have made the decision to [aprobar] a compensation-inflation of one hundred euros that will be sent to the French who earn less than 2,000 euros net per month ”, announced Castex in the news of the highest audience of the night of the TF1 chain.
The single payment will be “automatic” and will reach salaried workers, the unemployed, the self-employed or retirees whose monthly income does not reach the ceiling set between December and January, he added. In total, the measure will cost the state coffers 3.8 billion euros, although the prime minister has asserted that it will be able to absorb the new spending without exceeding its deficit target of 5% by 2022.
The Macron government announced a week ago that it would make a decision on how to counteract the rise in gasoline, and speculated on the different possibilities available to it, from a generalized lowering of the fuel tax – which represents 60% of its price final— to a more “focused” measure on those who really need to use the car in their daily lives and already suffer from the generalized inflation that has been going on for months in much of the world. Ultimately, this one-time “severance” payment was chosen as the “fairest and most effective” measure, Castex said. The lowering of taxes would have been too costly and, as official sources had warned several media before the final decision was known, it carried the added risk of the unpopularity that, once the crisis was over, to increase them again.
Although the rise in the price of gas and the threat that electricity will run the same risk at the beginning of next year have caused a headache for the political establishment in a country that is already in the middle of the presidential pre-campaign, it has been the rise in the gasoline which has generated the most concern. And it is that while electricity will be felt in a generalized way only from 2022, fuel prices have already caused complaints in a country that has not yet recovered from the long and harsh protests that led the yellow vests at the end of 2018 and a good part of 2019, the worst crisis that the Macron government has suffered until the arrival of the pandemic.
In addition, in his speech, Castex has also announced that the “lock” on the price of gas that it announced at the end of September for the first part of next year will be extended for “all of 2022”. On the eve of the gas rise of 12% on October 1, Castex also announced on TF1 that it was going to block that price “until April”, a period that has now been extended to all of next year. The “tariff shield” that he outlined also plans to limit the next increase in electricity to 4%, which will take place in February, despite the government’s estimates of a 12% increase at the beginning of the year. Last week, the National Assembly also gave the green light to the payment of an “energy check” of 100 euros that the Government plans to pay in December to another six million low-income households, and which is now joined by the “inflation compensation” for a much larger number of citizens.
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