This is distributing wealth from the poor to the poor, but I guess that is an improvement from distributing wealth from the poor to the rich. Maybe the point is that misery should be distributed more equally among the poor. France has always had an egalitarian streak! This is from IHT.
Socialists slam Sarkozy over new benefit for poor
By Thierry Leveque
Friday, April 25, 2008
PARIS: France's opposition Socialists accused President Nicolas Sarkozy of helping some poor people by penalising others on Friday after he said he would fund a new state benefit by cutting tax breaks for low income workers.
The new "active solidarity revenue" of 1,000 to 2,000 euros (787-1,573 pounds) per person per month is intended to help poor single parents and long-term unemployed people. It is expected to benefit 1.9 million people.
Sarkozy said it would cost the state 1.5 billion euros in new funding. Extra money would come from savings obtained by cutting tax breaks for low income workers that currently benefit 8-9 million people and cost 4 billion euros a year.
"He is redistributing money from the poor to the poor instead of taking it back from the rich," said Segolene Royal, the Socialist candidate who lost last year's presidential election to Sarkozy.
The new scheme, now being trialled in 34 of France's 100 local government areas, aims to give the poor an incentive to take a job rather than remain on welfare. As things stand, people automatically lose certain state benefits when they take a job and in some cases their income decreases.
In the only major domestic policy announcement of a prime-time interview on Thursday night, aimed at boosting his low popularity ratings, Sarkozy said he would extend the scheme to the whole country next year.
The Socialists, who introduced the tax breaks for low earners when they were in government in 2001, say Sarkozy has largely helped the rich with his own 15 billion euro tax cut package, introduced shortly after he took office.
A Socialist party statement said French families in the lower income bracket would lose some of their purchasing power. It said the tax breaks for such families should be increased by 50 percent, not reduced.
But Martin Hirsch, a former charity head recruited into the government by Sarkozy to look for ways of reducing poverty, defended the plan, which was his brainchild.
"This is really excellent news for all of those who are facing difficulties and who can't escape from poverty ... I think this is going to bring about significant social progress," Hirsch told France Info radio.
A public finances watchdog had said in a 2006 report that the tax breaks were not effective because they were spread too thinly, making little impact on individual households' income or on job creation.
(Writing by Estelle Shirbon, editing by Mark Trevelyan)
Copyright © 2008 The International Herald Tribune | www.iht.com