The 50 billion euros budget cuts for 2015 to 2017 is part of the country's European commitment known as the 'Responsibility Pact.'
PARIS - French MPs approved budget cuts of 50 billion euros (US$70 billion) for the next three years on Tuesday evening.
265 MPs voted the plan through, 232 voted against it and 67 abstained. Out of those that abstained, 41 were among the ruling party Socialist MPs who previously expressed their unease over the plan.
French Prime Minister Manuel Valls called Tuesday’s vote a “moment of truth” for France. The plan, known as the "Responsibility Pact", includes 50 billion euros worth of cuts to health care, local government and family subsidies to take place over the next three years to finance tax breaks for businesses looking to employ more staff.
Two weeks ago, Valls revealed the plan, that includes 40 percent worth of cuts - (approximately 21 billion euros). The prime minister declared that this will come from social welfare and the healthcare system. However, he stated that low income families will not be affected. Another 18 billion euros is to be trimmed from the budgets of government ministries and the remaining 11 billion euros will come from the streamlining of local government.
Valls reassured MPs that he had no plans to change France's minimum wage, the highest in Europe at 9.43 euros per hour. However, on Tuesday he made some changes to the initial plan which now exempts pensioners living on less than 1,200 euros a month from the welfare freeze.
Valls welcomed the MPs' approval of the cuts saying, "It was essential. This vote showed that the majority, beyond all the debates, approved this project."
The plan is due to be presented to the EU council in Brussels in early May.
Valls was appointed prime minister on March 31 in a government reshuffle following the ruling Socialists' poor performance in local elections on March 30.
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