The New Nation - Internet Edition

Reuters, Paris

France will keep its 35-hour working week in order to enable employees to add tax-deductible overtime to their salaries and boost growth, President Nicolas Sarkozy said on Tuesday.

Sarkozy also rejected the idea of budget austerity, saying his strategy for balancing France's budget by 2012 -- as promised to EU partners-was for the nation to generate more wealth through rising employment and increased overtime.

He has called the 35-hour week, brought in by a Socialist government 10 years ago, an "economic catastrophe," but appears reluctant to scrap it for fear of angering unions and voters. "I don't believe in austerity t What did austerity measures bring (in the past)? Higher unemployment, higher deficit and less growth," Sarkozy said during an interview on RTL radio.

"Austerity consists in squeezing spending without worrying about increasing revenues. What I want to do is control spending so that every euro cent spent is well spent, but at the same time foster growth so that revenues increase. "We will have higher returns because people will be working more." "There will always be a fixed working week and it will be 35 hours," said Sarkozy, whose mantra since year's election has been "work more to earn more."

Tax-deductible overtime beyond the 35-hour legal working limit is one of his key measures to increase purchasing power.