28 October 2015

New indicators of wealth

Inequalities are reducing, poverty in is decline, greenhouse gas emissions are decreasing, and France is doing significantly better than its European partners when it comes to life expectancy and R&D; these are just some of the findings highlighted by the 'new indicators of wealth', chosen based on consultation with the people and now the subject of an annual statement to Parliament. There will be no triumphalism, though, with employment remaining a priority for the Government.
Content published under the Government Valls II from 2014 26th August to 2016 11th February
The first report on the new indicators of wealth was published on 27 October. The Act of 13 April 2015 saw the Government commit to submitting "to Parliament on an annual basis [...] a report outlining the development of new indicators of wealth over past years, along with a qualitative and quantitative assessment of the impact of the main reforms undertaken" in light of these indicators and the progression in GDP:
  • The ten indicators selected were chosen based on a consultation with the people organised by France Stratégie and the ESEC (Economic, Social and Environmental Council). This lends democratic legitimacy to the indicators, as well as a certain form of independence in that the Government has not selected the indicators that best suit its purposes. It has endeavoured to respect the work of the ESEC and of France Stratégie and has selected reliable indicators that can be compared at European level.
  • "Some of the key measures in the process of being implemented will now be evaluated in light of these new indicators", the Prime Minister explains. The report evaluates, for example, six major reforms in the process of being implemented, these being the business component of the Responsibility and Solidarity Pact, the household component of the Pact (including the activity bonus), the superfast broadband plan (Plan Très Haut Débit), the poverty plan, the reform of the collège system and the energy transition act. There is far more to the Government's actions on the whole that these reforms would indicate, but they do offer an overview of what it is doing across all fields. A series of qualitative and, where possible, quantitative evaluations have been performed, notably with regard to GDP, employment, reducing inequalities and poverty. 
The report shows that France has assets. For 6 of the 10 indicators, France is generally in a better position than the European average. In particular, France ranks considerably higher than the European average with regard to pupils withdrawing early from the education system, poverty levels, R&D expenditure levels, healthy life expectancy, income inequalities and carbon footprint.
It also shows that the Government is working on reforming the country by implementing firm and coherent measures in all fields – economic, social and environmental – and that the results are starting to show. Recent progression (over the last available year) is positive for almost all of the indicators and the Government is continuing with its reforms to further improve the situation:
  • As INSEE (French National Institute for Statistics and Economic Studies) has recently shown, income inequalities decreased in 2013 to the point of eliminating the increase observed since 2008 with regard to the indicator comparing the incomes of the wealthiest 20% with those of the poorest 20%.
  • An evaluation of the measures in place shows that the Government's efforts are ongoing; indeed, the plan for fighting poverty and the measures associated with the Pact designed to help households will help reduce poverty by 0.9 of a point.
  • Greenhouse gas emissions have also decreased by 17% in relation to 1990. 
No room for triumphalism. "The report shows [...] that there are challenges ahead for us", Michel Sapin points out:
  • The situation regarding employment is one of the Government's main challenges.
  • Efforts must continue in order to achieve the 3% of GDP R&D objective that the European countries have set themselves.
  • Debt continues to increase, the aim being to reduce deficits without jeopardising the economic recovery. The public deficit has consequently been reduced by over 5% to 3.9% over the first part of the five-year term and will drop below the 3% mark by 2017.
  • There is still some way to go in fighting the artificialisation of land, and the Government is taking measures both to increase the density of urban areas and to encourage the maintenance of agricultural land in order to fight urban sprawl. 
This is an initial exercise and one that will be discussed in parliament by the end of November.

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