They came, they are all there … In a unanimity that was meant very solemn, all associations of elected representatives of the communal block (mayors of France, mayors of large cities, rural mayors , mayors of cities, intercommunal, etc.) signed a joint call to say “stop” to a further decline in state grants in 2017 … a topic that has poisoned relations between the state and local governments from . months
All associations thus sounding the alarm in a call:
the presidents of the associations of the communal block to ask unanimously the government abandoned last fall slice allocations planned for 2017. It is a national priority for stopping the loss of local investment.
Over the years 2014- 2017, the financial assistance of the State are indeed expected to decrease to 12.5 billion euros, a cumulative decline of 28 billion euros, of which € 15.7 billion (56%) for the sole communal block. The double downward movement endowments and unilateral transfer payments by the state led to the edge of fiscal imbalance a number of growing communities. After 10 billion decline in investment since 2013, the communal block is forced to reduce services to the population or to increase tariffs and limit local investments again.
be quite accurate, it is true that the state is engaging local communities to reduce public expenditure through, over 3 years (2015-2017), a decrease of 10.7 billion euros in overall staffing operation (DGF) paid by the state to communities, or about 3.6 billion euros each year. DGF had been reduced by 1.5 billion euros in 2014.
For Baroin, Mayor “Republicans” of Troyes and president of the Association of Mayors of France, “ the effort required to local authorities in general and communal block in particular in the context of the 50 billion euros of public spending is totally disproportionate, while local governments account for only 9.5% of the public debt, 4% for the only communal block. Everything else is the social security and the State “. And remember that, in parallel, 58% of public investments are carried by the communal block.
All associations of elected officials thus hope that François Hollande, expected the Congress of Mayors to be held here from Paris 31 May to 2 June, will arrive carrier “lA” good news: the removal of the last tranche of declining DGF 3.6 billion in 2017
So far, the minister. Finance Michel Sapin s’ is shown intractable yet, considering that the three-year decline plan must be brought to completion. But the tenant of Bercy is in his role … Political considerations in a year of presidential elections should weigh more than fiscal discipline.
Investment down 20%
especially since local officials are threatening the drastic drop in investment and its impact on employment. Olivier Dussopt President (PS) of the Association of small towns of France (VFPA) estimates that total in 2017 “ could result in a decrease of 15% to 20% of investments of the communal block” which enshrines, for example, 6 billion euros to the road. Eventually, “it is almost a quarter of the 250,000 employees working in public works that could be threatened” , dramatizes Baroin.
Not to mention the impact on services public weakened or closed. “ And these are already hundreds of festivals that are canceled for this summer” says Vanik Berberian, President of the Association of Rural Mayors of France (FDMA).
André Laignel , President (PS) of the local Finance Committee (LFC) puts his finger on another consequence of the drastic drop in state grants: the decrease in net cash of Commons. According to him, the reduction has already reached 30% between 2011 and 2014, it would still be 10% in 2015. It evokes “a phase of financial strangulation”. And without cash to serve as leverage, investments plunge. “In such cases the aid of the State or of the Caisse des Dépôts no longer useless.”
Increased use of debt
Also, to limit the stalemate and avoid excessive increase in local taxes, local governments into debt. In 2015, they continued to borrow from banks and the bond market. Outstanding debt of communities and is up 4.9% year on year to 178 billion euros. Debt plays a role in the short term bandage, but if this trend extended -less than own resources and more debt -. The solvency of some local authorities could be severely affected
“ We are entering a phase solvency crisis for some communities who see their repayment capacity erode strongly , “explained from October 2015 Serge Bayard, Chairman of the Board of La Banque Postale local authorities. Thousands of towns suffer gradual degradation of their debt ratio: 18% of them now have higher debt capacity to 10 years, 12% over 15 years. These profiles are considered very risky by the bankers, and they are often medium-sized cities that are involved. They were betting indeed much on the financial support of the departments that they were forced to withdraw for lack of resources
In this regard, Baroin yet alert, saying that the level of debt some towns became critical and “ that several hundred municipalities have already passed under the authority of the state” .. .
with such a dramatization by the associations local elected officials, it is unclear how Hollande could escape a gesture at the Congress of mayors …
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