President Emmanuel Macron of France held his first major rally in his reelection campaign on Saturday, promising the French more “progress” and “solidarity” over the next five years.
Emmanuel Macron, the French president, held his first major rally in his reelection campaign on Saturday, promising the French more “progress” and “solidarity” over the next five years, but his campaign has hit a snag.
The case has been dubbed “the McKinsey Affair,” after an American consulting firm hired by the French government to advise on the COVID-19 vaccination campaign and other policies. A new report from the French Senate casts doubt on the government’s use of private consultants and accuses McKinsey of tax evasion. The issue is energizing Macron’s opponents and following him around during campaign stops ahead of France’s first-round presidential vote on April 10.
Macron, a centrist who has been at the forefront of diplomatic efforts to end the conflict in Ukraine, has a comfortable lead over far-right leader Marine Le Pen and other challengers in polls thus far.
“We are here to make possible a project of progress, of independence, for the future, for our France,” Macron told a crowd of about 30,000 people at a stadium where rugby matches are usually held. “I see people struggling to make ends meet, insecure situations… and so much more that needs to be done to reverse extremism.”
Speaking to those who are seeing “all their salary go into gasoline, bills, rent” as food and energy prices rise due to the war in Ukraine, Macron promised that companies will be able to give employees a tax-free bonus of up to 6,000 euros ($6,627) as soon as this summer.
He also promised to raise the minimum pension for full-time workers to 1,100 euros ($1,214) per month, up from around 700 euros now. To fund the plan, he says the retirement age will have to be gradually raised from 62 to 65.
“Macron, president!” chanted his supporters as they greeted him. “One, two, five more years!” he exclaimed as he waved the French tricolor flag.
The term “McKinsey” is becoming a rallying cry for those seeking to depose Macron.
Critics accuse the French government of privatizing and Americanizing French politics by spending 1 billion euros on consulting firms like McKinsey last year, and demand more transparency.
Last month, the French Senate, which is controlled by the opposition conservatives, released a report looking into the government’s use of private consulting firms. Despite mixed results, state spending on such contracts has doubled in the last three years, according to the report, which warns that they could lead to conflicts of interest. Hundreds of private companies are involved in consulting, including giants like Accenture, based in Ireland, and Capgemini, based in France.
The report claims that McKinsey hasn’t paid corporate profit taxes in France since at least 2011, instead opting for a “tax optimization” system through its Delaware-based parent company.
McKinsey issued a statement defending its work in France and stating that it “respects French tax rules that apply to it.”
McKinsey was a key adviser to the French government on the COVID-19 vaccination campaign, which started slowly but grew into one of the most comprehensive in the world. Outside consultants have also provided advice to Macron’s administration on housing reform, asylum policy, and other issues.
According to the Senate report, such firms earn less money in France than in the United Kingdom or Germany, and spending on outside consultants was higher under former conservative President Nicolas Sarkozy than under Macron.
According to Budget Minister Olivier Dussopt, the government spent about 0.3 percent of its budget on public servant salaries last year on consultants, with McKinsey earning only a fraction of that. He accused his rivals in the campaign of inflating the scandal to boost their own ratings.
Macron is still hurting as a result of the affair.
Macron, a former investment banker who was once dubbed “president of the rich,” saw his popularity rise after his government spent heavily to protect workers and businesses early in the pandemic, vowing to do “whatever it takes” to mitigate the impact. His opponents, on the other hand, claim that the McKinsey affair has reignited concerns that Macron and his government are beholden to private interests and out of touch with ordinary citizens.
Macron is now being questioned about it everywhere he goes.
“I’ve heard a lot in the last few days about tax evasion, an American company,” Macron said at a rally on Saturday. “I’d like to remind those who are outraged that they (consulting firms)” were also used in local government.
He also mentioned his government’s efforts to ensure that businesses pay their fair share of taxes.
“We fought for the European minimum tax, and we got it,” he said.
France is pushing for a quick implementation of the 15 percent minimum corporate tax agreed upon by more than 130 countries last October in the European Union’s 27 member states.
Source: ABC
