French deficit target in reach, but new spending cuts needed, ministry says

PARIS (Reuters) -The French government's 2025 budget deficit target is still in reach, but cost overruns mean that an extra 5 billion euros ($5.9 billion) in spending cuts is needed to get there, the Finance Ministry said on Thursday.

The government aims to cut the public sector budget deficit to 5.4% of GDP from 5.8% last year, when spending spiralled out of control and tax income fell short of exceptions.

"The diagnosis is clear, and so are the decisions: meeting the public deficit target of 5.4% of GDP in 2025 remains achievable, but subject to an additional effort of 5 billion euros on spending," the ministry said in a statement.

Next month Prime Minister Francois Bayrou is preparing to outline 40 billion euros in new spending cuts in next year's budget.

($1 = 0.8520 euros)

(Reporting by Leigh Thomas;Editing by Sudip Kar-Gupta, William Maclean)