Giscard d'Estaing bides his time: A former president looks beyond this month's French poll, writes Julian Nundy in Paris

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IN FOUR weeks' time, France looks set to vote its Socialist government out of power. Although the national assembly elections on 21 and 28 March seem sure to bring in a new centre-right government, former president Valery Giscard d'Estaing believes France will have little hope of making substantial changes, especially of turning the economy around, until President Francois Mitterrand leaves office in May 1995.

The announcement of the next government at the end of March will usher in France's second experiment in cohabitation - a conservative cabinet under a Socialist president. The first occurred in 1986 when the Gaullist leader Jacques Chirac was prime minister under Mr Mitterrand until the President defeated Mr Chirac in the 1988 presidential election.

In an interview last week, Mr Giscard d'Estaing, the founder of the centre-right Union for French Democracy (UDF), said that he thought the new government would have little more than a year in which to act. In this time it needed to gain public confidence to be sure of staying in power. From the summer of 1994, he said, the country would be plunged into a new election campaign - for the presidency - limiting the government's room for manoeuvre.

Among the important measures facing the new government was reform of the Bank of France, making it 'totally independent' as a precursor to European monetary union. This, he said, would be put through the national assembly in the spring session following the elections and through the senate, the upper house, in the autumn, enabling the reform to be completed by 31 December.

Mr Giscard d'Estaing, 67, president from 1974 until his defeat by Mr Mitterrand in the 1981 presidential election, is stressing his role as an elder statesman in this campaign. He is not standing for a national assembly seat but he is on the campaign trail, supporting members of his party.

While 'la politique politicienne' - 'insider politics' - currently hogs the headlines, especially speculation about the identity of the next prime minister and the composition of the cabinet, Mr Giscard d'Estaing says he aims to try and concentrate the public mind on the real issues.

To this end, he is holding a news conference every week between now and the elections to deal with various topics. Last week, themes he handled included the budget deficit; this week, he will discuss unemployment. Although members of his entourage have put Mr Giscard d'Estaing forward as a candidate for the prime minister's post, he reminds questioners that the choice is the president's alone and adds that he is not a candidate. Edouard Balladur of the Gaullist RPR, which is allied with the UDF, is the current favourite.

French political commentators believe that Mr Giscard d'Estaing might be a presidential candidate in two years' time, but it is a subject on which he will not be drawn.

Discussing the aftermath of the narrow French ratification of the Maastricht treaty, Mr Giscard d'Estaing, himself a former finance minister, said interest rates, rather than European monetary union, were what worried the French. 'It's a problem of short- term interest rates, which are too high, especially for small businesses,' he said. 'The new government must adopt a strategy to remedy this situation. This is not easy to do but we must have significant results this year and better results in 1994.' French short- term interest rates currently stand at 11.25-11.50 per cent.

As for monetary union, Mr Giscard d'Estaing said this was still a priority for a centre-right government: 'The deadline is 1 January 1997. I hope our future government will suggest to our partners that we start work immediately on establishing the European monetary institute. It is due to start on 1 January 1994. We have (by then) to name a president and work out its organisation. Then we would like to see it prepare the application of Maastricht.'

As for the most spectacular domestic reform, the independence of the Bank of France, he added: 'This will be carried out in 1993. The independence will be total, along the lines of the German model.

'But there will be two differences. Our objective will not be price stability but that of the currency. And the composition of the board will not be the same because we do not have federal structures. '

Undoubtedly the biggest event in French politics in recent weeks was the call 10 days ago by Michel Rocard, the most likely Socialist candidate in the next presidential election, for 'a big bang', bringing together a broad coalition of different groups from the centre to dissident Communists, to revive the fortunes of the left. Mr Rocard's initiative has pushed him to fore of the French political scene and predictably annoyed Mr Mitterrand who has said only that the Socialist Party needs to recover its direction first.

For Mr Giscard d'Estaing, who considers himself a centrist, Mr Rocard's move was flawed. 'He commits the error, in his list, of including reformist Communists,' he said. They were 'perhaps not Stalinist Communists but they represent political options which are incompatible with the values of the centre in France'.

Another error was to include ecologists. Ecologists 'will only exist as long as they are autonomous. The day that they join any party, they will lose their identity. So Michel Rocard's project includes from the start people who should not be there and others who would be doomed to disappear.'

Last week, Brice Lalonde, the head of the Generation Ecologie party, said he favoured Mr Rocard's idea. However, Antoine Waechter, leader of the Greens with whom Mr Lalonde's supporters are allied for the forthcoming election, has been cold to the concept. Opinion polls give the combined ecologist vote between 15 and 17 per cent, with the Socialists slightly ahead with 19 or 20.

Mr Giscard d'Estaing said economic recovery 'needs a considerable effort and the time-frame we have is very short. The presidential election will take place in April 1995. From the summer of 1994 all minds will be turned to this election. We will have 15 months to act and everything will depend on the budget of a single year. . . '

(Photograph omitted)