© CHRISTOPHE ARCHAMBAULT / AFPAt a bakery in Paris: Impacted by rising energy prices, bakeries are set to receive emergency aid from the French government - which wants the dough to keep rising, not electricity bills.
Comment: They think that putting the bakers further into debt is the answer?
In another announcement, Economy Minister Bruno Le Maire said bakers would be able to terminate their electricity supply contract free of charge in the event of a "prohibitive" price increase that "threatens the survival of the business."
Comment: All suppliers are charging exorbitant fees, even when the wholesale price drops, so if businesses cancel their contract, then what? How is that actually helpful? If anything it's encouraging businesses to just shut up shop.
However, this "exceptional" measure will be applied "on a case-by-case basis" by energy companies, Mr. Le Maire warned at the end of a meeting at the Interior Ministry with electricity suppliers TotalEnergies, EDF, Engie and the National Association of Retail Energy Operators (Anode), which groups together alternative operators.
"The state is at the side of all bakers in France and we will not let anyone down," the minister had said earlier in the day at a press conference, after receiving industry representatives.
On the brink
Electricity suppliers also assured that they would fully apply a charter of good practices signed in October, which Mr. Le Maire accused them of not respecting. In particular, they had undertaken to notify customers not eligible for the regulated rate of electricity (TRV) at least two months before the end of their contract.
If they fail to do so, the offenders "will have their names publicly disclosed," Mr. Le Maire warned. "We can always levy more on energy suppliers than we do today," the minister threatened again, after months of heated debate around the taxation of superprofits.
Comment: They debate and threaten but it's highly unlikely they'll do anything of substance.
In addition, electricity suppliers "committed [on Tuesday] to offer payment facilities to SMEs and microbusinesses," he added.
As a result of the war in Ukraine, the price of electricity that powers the huge ovens and cold rooms of bakeries has exploded. In addition, the cost of raw materials (flour, butter, eggs, sugar, and so on) has risen sharply.
Comment: France backing the anti-Russian sanctions contributed to the situation much more than Russia's special operation in Ukraine.
As a result, for several months now, many professionals in the sector have been saying they are on the brink, worrying about going out of business. At the end of December 2022, the highly publicized case of Julien Pedussel, a baker in the Oise region, helped alert people to the threat facing these shopkeepers. In Le Parisien, the manager of the Fournil de Rieux said that his electricity bill had risen from €1,000 in October 2022 to over €6,000 in November. An increase that is impossible to absorb by his turnover (about €20,000 a year) or to pass onto his prices.
To help small and medium-sized businesses, including bakeries, the government has already put in place several measures. Since January 1, the government's "shock absorber" has allowed for partial and automatic coverage of electricity bills. Thanks to this measure, small and medium-sized businesses "will have a reduction in their bill of 20% on average", said Mr. Le Maire on Tuesday, December 6, 2022, during questions to the government at the Assemblée Nationale. Small and Medium-sized Enterprises Minister Olivia Grégoire had mentioned a reduction of 15% the previous Friday, on the occasion of a visit to a baker in the 15th arrondissement of Paris.
Aid that is not 'sufficiently well-known'
Some merchants will be able to combine the government's "shock absorber" with its platform where small and medium-sized businesses can register to receive emergency government aid to compensate for higher electricity or gas prices. It was supposed to stop at the end of 2022 but was extended to 2023.
After the reduction received under the "shock absorber," small and medium-sized businesses whose energy expenses represent 3% of sales in 2021, and whose electricity bill has increased by more than 50% compared to 2021, will be eligible. "Overall, we'll take care of around 40% of the electricity bill," Ms. Borne assured on Tuesday. However, she went on to regret that most of the assistance available is "not sufficiently well known" to business heads.
Comment: What of businesses whose bill has risen by 'just' 45%? They get no help?
Further, if they can brainwash entire nations with lies about covid, they could make these benefits known with relative ease.
Contacted by Le Monde, Dominique Anract, president of the Confédération nationale de la boulangerie-pâtisserie française, welcomed "the significant aid," and acknowledged that the profession was "fairly well protected." "The situation is serious but not desperate," he said, adding that, "deferring payments can help us get through a difficult period in terms of cash flow."
Comment: This is assuming the economy will improve, when all the signs show otherwise: Eurozone's 'kamikaze' interest rate rises could collapse currency and cause severe economic crisis in Italy
Above all the possibility of canceling an electricity contract free of charge is "a real step forward and a relief" because "no support mechanism would have been enough to deal with an [electricity] bill multiplied by ten or twelve," he said.
Despite the announcements made on Tuesday, Mr. Le Maire once again closed the door to "aid without an end date." "This assistance is targeted at the companies in most difficulty," he insisted, while the government now wants to gradually move away from "whatever it takes" to preserve public finances.
Comment: This 'help' is at best is merely a token gesture that might temporarily appease (or fool) some, but what of the struggling families? What of the desperately needed professionals, such as France's doctors who have just extended their strike over deteriorating working conditions and pay?
The only real change Europe has seen during the lockdown years is that living standards have plummeted; and in response to this, France's Yellow Vest protests, that were actually interrupted by the contrived coronavirus crisis, are planning on reviving them this Saturday, and it's likely that this will be the first of many, many more to come.