Cost of living in France: New details on ‘purchasing power’ law

[Article updated on May 9 at 10:00]

The French government is set to legislate a range of new measures to help people in France with rising inflation and cost of living, in what has been dubbed the 'purchasing power law'.

The 'Loi pouvoir d’achat' is being drafted by outgoing Prime Minister Jean Castex, and is set to help residents face up to rising inflation and soaring costs of food and fuel.

"The issue [of inflation] is not a disaster but it is obliging us to act," a government spokesperson said. "8% inflation, like Germany is seeing, is at least a month's salary. The role of the state is to protect French people," they added, before commenting that "what we have done [already] means that we have a much lower inflation rate than elsewhere in Europe."

Inflation in France has recently been calculated at 4.8%, and may continue to rise, alongside the prices of hundreds of everyday goods.

Read more: French inflation at 4.8% year on year to April

The new bill will be presented as a projet de loi de finances rectificatif (PLFR, 'rectifying finance bill') during the summer, to amend the state budget. It will include several measures pledged by President Emmanuel Macron, as part of his recently-confirmed second term.

Read more: End of TV licence fee, food cheques: Macron's promises if re-elected

Measures include:

• Continued tariff shield ('bouclier tarifaire'): Limits on the rise in prices of gas and electricity

• Fuel prices: rebate of 18 centimes per litre to be prolonged in the form of a more targeted measure

• Pensions: Reevaluation this summer, rather than the usual annual process

• Social benefits: Rise according to inflation, including the RSA, disabled adults' allowance and family allowances

• Food voucher ('chèque alimentaire'): Set to enable the least well-off households to buy more healthy food. The sum distributed to recipients, and the regularity of payments are details which are still yet to be decided

The bill will formalise and continue many of these measures, which have already been announced in recent weeks and months.

It comes as supermarket chains and fuel providers have also announced measures to help improve consumers’ spending power, including E. Leclerc freezing the price of 120 most-bought items from May 4 until July.

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