Created by the Organic Law of 17 December 2012 on public finance programming and governance, the High Council of Public Finance (HCFP) sheds light on the choices made by the Government and Parliament and ensures that the path towards a return to balanced public finances is consistent with France's European commitments. To this end, it assesses the realism of the Government's macroeconomic forecasts and decides on the consistency of the annual objectives presented in the financial texts (budget bills, amending budget bills, etc.) with the multiannual public finance objectives.
To give an opinion on the realism of the Government's macroeconomic forecasts
The HCFP is responsible for advising on macroeconomic assumptions - including growth forecasts - used by the Government to prepare key public finance documents, prior to their submission to Parliament: public finance programming bills, budget bills, social security budget bills, amending budget bills and stability and growth programme transmitted annually to the European Commission and the Council of the European Union.
If the Government has to modify its forecasts during parliamentary debates, it informs the HCFP, which must also give an opinion.
The forecasts analysed by the HCFP are either short-term (one or two years) for annual finance bills or medium-term (four-year horizon) for multiannual texts (programming bills and stability programme).
When expressing an opinion on the realism of macroeconomic forecasts, the HCFP shall take into account the forecasts of other organisations. Their list is made public by the HCFP.
Delivering an opinion on the consistency of the annual objectives with the multi-annual public finance objectives
The HCFP ensures that the path towards a return to balanced public finances (State, local authorities, social security) is consistent with France's European commitments.
According to the Treaty on Stability, Coordination and Governance in Economic and Monetary Union (TSCG), this path concerns the structural balance, after adjusting for the effects of economic fluctuations on government deficits and net of one-off and temporary measures.
The HCFP is seized of all the financial texts. Its opinions are delivered before these texts are presented to the Parliament. They concern the future (the next budgetary year or the next multiannual programming of public finances) and the past (the past budgetary year). All HCFP opinions are transmitted to the Government before the texts are presented to Parliament. The President of the HCFP is heard by the Finance Committees of the National Assembly and the Senate before the parliamentary debate.
When the Government prepares a multiannual public finance programme, the HCFP gives an opinion in September on the coherence between the objectives set by the draft programming law and France's commitment to ensure the structural balance of its public finances in the medium term.