French left urges Hollande to drop reforms

Reuters News
Posted: Mar 31, 2014 6:44 AM

PARIS (Reuters) - The left wing of President Francois Hollande's Socialist party urged him to take heed of a stinging defeat in local elections by abandoning pro-business reforms and public deficit targets imposed by the European Union.

Hollande's Socialists lost control of some 150 towns in Sunday's elections marked by a record low turnout and strong gains by opposition mainstream conservatives and the far-right National Front.

An open letter addressed to Hollande by senior left-wingers called on him to return to Socialist basics and said his plan to boost investment and job creation by offering business some 30 billion euros in corporate charge cuts was "still-born".

"Don't be afraid to abandon this path," said the letter, posted on the website of Paris Socialist senator Marie-Noelle Lienemann and signed by fellow left-wingers including Jerome Guedj and Emmanuel Maurel.

"Job creation comes from a re-launch of public investment and consumption," it said, urging Hollande to end a freeze on public sector salaries, raise the minimum salary and pensions.

Weeks before France must present the EU with new details of plans to bring down its public deficit, the letter said the government should simply ignore the demands of the EU stability pact committing it to a deficit under three percent of output.

"Specifically, (France) must take on the European Commission and tell it that it refused to meet on time the impossibly restrictive deficit criteria which it has imposed," it said.

Data released on Monday showed it was 4.3 percent in 2013, above its 4.1 percent target.

Hollande is widely expected to announce a cabinet reshuffle at some point this week. His ministers have defended the reforms made by his 22-month-old government but have said there is a need to show more "social justice" for low-income earners.

(Reporting by Mark John and Brian Love; editing by Brian Love)