Chirac jobs creation plan `will not work'

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The Independent Online
Jacques Chirac's elaborate job-creation programme, designed to address the key issue of the French presidential election campaign - unemployment - has been dismissed by a group of leading economists.

Le Monde newspaper commissioned the group, led by Professor Alain Muet from thePolytechnique in Paris, to consider the policies on unemployment of the three leading candidates - Jacques Chirac, who is leading the opinion polls, the Socialist, Lionel Jospin, and the Prime Minister, Edouard Balladur.

Of the three, Mr Chirac's programme was considered the least likely to make any difference. Mr Jospin's proposals, which include reducing the working week to 37 hours, was considered the most likely to produce results. Mr Balladur's recipe for continuing existing government policies, plus reducing social charges on employers, came next.

Mr Chirac's programme includes a "right" for all young people to training and apprenticeships, job subsidies for long-term or young unemployed, and greater use of part-time and flexible working, but no statutory reduction in the working week.

The economists said Mr Chirac's proposals would create only 50,000 jobs at a cost of more than 18bn francs (£2.4bn). A chief criticism was that subsidies to ease the unemployed into jobs couldlead to the substitution of existing workers rather than an increase in the total number of jobs. The proposals of both Mr Balladur and Mr Jospin would each create more than double the number of new jobs, at a fraction of the cost.

Whatever the value of the economists' projections, this is the first time any part of Mr Chirac's highly detailed and glitzily presented programme has been subjected to detailed scrutiny over its likely effectiveness. Early in the campaign, Nicolas Sarkozy, Mr Balladur's spokesman and the Budget minister, organised a detailed "costing" of Mr Chirac's proposals, which calculated they would double the existing budget deficit and could affect the franc's stability.

That exercise produced a fierce argument - ended by the international currency crisis whichdid threaten thefranc.

The question now is whether the voters, whose scepticism of the candidates' ability to deliver their promises is well documented, pay any attention to these findings and start to examine other areas of policy - or whether Mr Chirac's lead is so well-entrenched and grounded in personal loyalty that they make no difference.

Challenged with the findings, Mr Chirac's spokesman, Franois Barroin, said the economists chosen by Le Monde favoured Mr Jospin, making their findingsentirely predictable.