The High Council of Public Finance gives an opinion on the realism of macroeconomic and public revenue and spending forecasts in budget draft bills, social security financing draft bills, public finance draft programming law, sectoral draft programming law and draft stability programmes up to 2024. To this end, the High Council relies both on the information it receives from its external partners and on the tools and analyses it develops internally.
Prior to the preparation of its opinions, the High Council sends questionnaires to the Government authorities in order to specify the figures and explanatory information relating to the commentary on the past financial year or its macroeconomic and public finance forecasts, depending on the stage in the budgetary cycle. The High Council also hears forecasting bodies such as the French National Institute of Statistical and Economic Studies (INSEE), the Banque de France, Rexecode and French Economic Observatory (OFCE), as well as the Government, on the macroeconomic scenarios used by each institution.
The High Council then compares the assumptions made in the budget bill with the latest available economic indicators (the national accounts published by INSEE, results of INSEE or Banque de France consumer and business surveys, changes in the wage bill published by Urssaf, etc.), as well as the latest forecasts.
The Permanent Secretariat of the High Council also carries out its own studies on macroeconomic or public finance issues, the results of which support the preparation of the High Council's opinions. For example, it produces structural analyses, such as the construction of historical and forecast ‘constant-scope’ State expenditure series used in its opinions on draft sectoral programming laws, which have shed light on the constraints that complying with the public finance trajectory imposes on the outcome of sectoral commitments.
The High Council also employs a number of tools developed internally that enable it to counter-expertise the Government's forecasts: for example, tools for estimating the tax base of the main compulsory levies, such as VAT, have been developed to examine the consistency of revenue forecasts for these compulsory levies with macroeconomic forecasts.
Finally, the High Council verifies the intrinsic consistency of the forecast scenarios in the budget bills it examines. In particular, it examines the consistency of the assessment of the output gap with the investment, inflation and wage forecasts. It also examines the consistency between the expected impact of the announced fiscal policy and the associated growth forecast.