Can France increase its defense investments beyond the limits of the LPM 2024-2030?

A few days before its official presentation, the content of the future French Military Programming Law, which will frame the State's investments in these armies for the next 7 years, begins to become clearer and clearer. However, beyond the some €400 billion in investments planned over the next 7 years, and the €13 billion in exceptional loans also planned over this period, and although this trajectory represents an increase of €100 billion compared to vis-à-vis the previous LPM, many voices have been raised for a few days to regret the arbitrations, and sometimes to criticize the amount judged, not without reason it is true, as insufficient vis-à-vis the needs of the armies in the face of the rapid evolution of threats in Europe and worldwide. If these voices agree on the observation, namely that several tens of billions of Euros are missing from this LPM to effectively meet the needs of the armies, and without entering into the debate of whether more tanks are needed, no more anti-aircraft systems, no more submarines or no more drones, however, it appears that no one is risking even giving leads to allow the financing of these critical needs.

As a reminder, if the next LPM respects a linear growth trajectory for the armed forces budget in order to reach the planned €413 billion, the Armed Forces will have, in 2030, an annual budget of €68 billion, representing between 2,25 and 2,3% of the country's GDP on that date. This objective represents an increase of almost 55% in the annual budget for the LPM, therefore around 40% in constant euros, and 112% compared to the 2016 budget. doubt, of a considerable effort made by the French government, all the more considerable since many other subjects weigh on public opinion, which is more worried about the evolution of the health service or the supply of education, whether the French armies have 200 or 400 heavy tanks. In other words, apart from the relatively small sphere of people sensitive to defense issues in the country, the question of the LPM and the Armies is not a priority for many French people, and the spectacular increase in defense over the past 6 years, like that of the period 2024-3030 to follow, is not in itself a subject with high potential for political satisfaction. It should also be noted that the €413 billion forecast is much closer to the €420 billion claimed by the Ministry of the Armed Forces than to the €370 billion proposed by the Ministry of Finance.

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However, and despite the obvious political and budgetary effort made by the authorities in this matter, the points of weakness noted by numerous commentators in recent days are not meaningless either. Thus, while the modernization of French deterrence alone will capture nearly €100 billion from this new LPM, and while operating costs and the increase in sales will capture 45% more, there will hardly be any credits left to modernize the forces, and therefore to develop and acquire new systems, as well as to hope to increase the current size of the armies beyond the 50.000 additional reservists to be recruited. From a synthetic point of view, and without going into a long demonstration, we can estimate that this LPM would lack some €100 billion in additional credits, not on a gradual trajectory as currently planned, but for repair the damage linked to the critical under-investment in this area from 2000 to 2020, this having led to a significant aging of the average age of the equipment, the reduction of the parks, and therefore very significant losses in operational performance. Knowing that, from a budgetary point of view, an additional increase is to be excluded unless additional revenue is justified, what solutions might be available that would allow France to finance this immediate effort?

1- Redirection of appropriations on new revenue or budget savings

Among the solutions sometimes mentioned to allow an increase in the defense effort in France, the budgetary reorientation, on the basis of potential savings made on public expenditure or new revenues, is incontestably the most frequently put forward. This would involve, depending on the case, cutting budgetary expenditure deemed ineffective, and generating additional revenue or savings by fighting against fraud, whether fiscal or social. However, it appears that the application of these measures is much more difficult once past the campaigns and electoral promises, and several governments have broken their teeth, depending on whether they were on the right by promising the end of social fraud, or left by sounding the hallali of tax exiles. In the end, these approaches do not make it possible to release, in a certain and predictable way, the resources necessary to sustainably finance an increase in defense credits, while planning on variable revenues has also shown its limits during the Sarkozy and Hollande five-year terms. Without prejudging their relevance and applicability, these measures do not have sufficient robustness to make it possible to build the budget of the armies around the results which can only be, at best, hoped for.

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