Written by Beth Nicholson,
26th September 2022

The rising cost of living is of paramount concern to people worldwide. But what is the current situation in France? And what is the French government doing to help combat this?

Throughout last year the cost of energy and fuel (for both vehicles and heating) in France has been rising at an alarming rate. And the current cost of living crisis doesn’t end there. Food prices are also rising sharply due to both the Ukraine crisis and changing weather conditions. And in addition, many other industries are raising the prices of their products and services as a result.

EDF is France’s biggest energy supplier (olrat / Shutterstock.com)

Energy Prices

Whilst people in France have seen rising energy prices, the main electricity provider EDF has been under government decree to cap their price increases at 4% throughout this year. And the existing price cap on both electricity and gas will, it seems remain in place until the end of 2022.

To ensure these prices do not spiral out of control in 2023, the government has now announced price caps for next year at a maximum of 15%. Whilst not ideal, this is certainly lower than the price rises that some other countries, including the UK are already experiencing.

The French prime minister is making repeated warnings to French citizens of the need to remain mindful of their energy use. In order to avoid potential future shortages. And plans are under discussion to offer better tariffs to those with the ability to use energy at non peak times.

In addition, some energy providers have tried to employ underhand tactics with existing customers, in order to allow them to sell their energy to other suppliers at higher prices than the price cap. They have not been allowed to get away with this practice. With many investigations starting over the last few months in order to crack down on this swiftly.

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Filling up with petrol at a gas station

Fuel Prices

Initially a result of the Ukraine crisis, fuel prices for vehicles, machinery and heating in French homes has risen sharply. The French government have however been implementing a series of fuel rebates (on price per litre). The aim being to keep the spiraling cost of living under some semblance of control. And Total petrol stations (being one able to offer the highest discounts), effectively creating a panic buying type situation at many of their forecourts.

And alarmingly, the cost of oil for boilers has increased at a truly disproportionate rate of around up to 80%. Potentially disastrous in a country where so many rely on this method of heating, particularly the elderly and vulnerable. The French government have as part of their 2022 budget announced a 230 million euro financial aid package for those heating homes across France using oil.

Yet even those using other methods, including wood pellets and wood have not managed to escape unscathed. With costs rising for both these commodities, many have taken advantage. As well as creating the need to publish warnings to French citizens, of potential scams advertising unrealistically cheap prices for product that never in fact arrives.

Tjhe France Cost of Living Survey

In the market in Provence (BTWImages / Shutterstock.com)

Food

The rising cost of living has also affected food supplies. Shortages of some ingredients, along with changing weather conditions have seen sharp rises, even in the most basic of food products.

In a bid to help, Leclerc announced more than 100 products to be added to their existing 120 most bought items listed in their anti-inflation price freeze program. And many other supermarkets have brought in new anti-waste measures in a bid to help the increasingly anxious population. Selling products reaching end of life at vastly reduced prices.

A petition is also circulating against the phenomenon of “shrinkflation”.  A practice whereby the amount of product to the consumer reduces, but the pricing does not reflect this reduction.

Others

And it is not just energy, fuel and food being affected by the current cost of living crisis. Other notable increases include the price of both car repairs and tyres. Rising sharply in France, due to parts shortages and supply chain issues. As well as dining out. Due to both increasing food prices and costs of lighting and heating establishments.

And even holidays at home appear to be under threat. Ski resorts are reportedly increasing prices by up to 20%, creating a potential crisis for this important part of French tourism, due to inflating energy prices.

bikes

E-Bikes in Paris, September 2022 I Flydragon via Shutterstock

What is the French government doing to help?

In a bid to help its citizens through the cost of living crisis, the French Government continue to undertake a series of actions to relieve the pressure on people. With several further options still under discussion and consideration.

In August, parliament voted to abolish the TV licence tax in France. Bringing with it potential savings for 6.2 million households in France, of approximately 140 euros annually.

Financial aid is increasing for the purchase of electric bikes by around 100 euros. To offer a potential option to those needing to combat increasing travel costs. And a financial aid package for those heating their homes with oil is being introduced.

And another financial aid package has been announced against the rising cost of living of this year. Known as the “prime exceptionnelle de rentrée scolaire”. This is to be provided to lowest income households. With payments of up to 100 euros per adult within the household. As well as an additional 50 euros for each child. According to reports, these payments are scheduled to start from mid-September.

 

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