Hollande promises new savings to meet 4bn-euro Brussels demand

French President Francois Hollande said Wednesday his government would find four billion euros in "new savings" this year to meet deficit reduction demands from Brussels.

"If Brussels asks for four billion more to respect our obligations in reducing the public deficit, they will be found with new savings," said Hollande in an interview with daily Le Parisien.

The European Commission last week gave France two years to bring its deficit under the limit of three percent of GDP, but set strict levels that must be achieved along the way.

It ruled that France's budget for 2015 would not be enough to achieve a reduction of 0.5 percentage points in the deficit this year, and demanded a further four billion in savings.

On Wednesday European Commission President Jean-Claude Juncker told Spanish daily El Pais that while Paris had undertaken spending cuts and structural reforms, those "have not been ambitious enough."

He also noted that France could yet be fined if it fails to continue reforming and reigning in its deficit.

"I'm sure the French government has understood that penalties remain a possibility," Juncker said, adding France "knows it must do better, and it will."

In his interview, Hollande promised "there will be no tax rises in 2015, 2016 and 2017" and that the process of lowering charges for businesses would continue.

He also criticised tax avoidance efforts by large business groups, such as Total.

"Total, which is the biggest French group, should be the biggest French contributor," he said.