France to delay €1bn outlay

The French government will shelve €1 billion of planned spending this year, on top of a three-year spending freeze that kicks in in 2013, said Budget Minister Jerome Cahuzac.

President François Hollande’s five-week-old Socialist government is battling to bring its public deficit down to within a target of 4.5% of gross domestic product by the end of 2012, mainly through planned tax increases.

Prime Minister Jean-Marc Ayrault told cabinet ministers on Monday that overall spending at ministries and regional government departments would be frozen from 2013 for three years, excluding debt costs and pensions.